Thursday, April 22, 2010

Rig Explosion Shows Risks in Key Oil Frontier. No impact!

Henry J. Reske

National Geographic News

Published April 22, 2010

Just last September, the operator of the semisubmersible rig known as the Deepwater Horizon announced it had succeeded in drilling the deepest oil well in history. Operating in 4,130 feet (1,260 meters) of water, the rig had drilled six miles (10 km) beneath the sea floor to reveal a major petroleum find, the Tiber Prospect, for the giant oil company BP.

Now, authorities are trying to learn what went wrong on the platform, where an explosion left at least three people critically injured and 11 more missing as of Thursday. Rig operator Transocean Ltd. said 115 workers were evacuated safety, but the fire burned long after the blast, apparently fed by the flow of oil or gas hydrocarbons. The company said the investigation of the incident 41 miles (66 km) off the shore of Louisiana could take weeks.

The mishap was a reminder of the dangers inherent in offshore oil operations at a time when the fields of crude deep under the sea are seen as the industry’s most important frontier—one where companies like Transocean and BP have aimed to push the boundaries of exploration.

The Past and Future of Offshore Drilling

U.S. reliance on oil from the Gulf of Mexico has grown steadily since the early 1980s, when the basin contributed just 8 percent of the nation’s oil production. By 2008, the most recent year for which data is available, the Gulf was pumping out 1.15 million barrels a day, 23 percent of the oil produced in the United States, according to the U.S. Energy Information Administration. In contrast, Alaska’s North Slope, declining in output in recent years, represented just 14 percent of U.S. production in 2008.

President Obama affirmed last month that offshore resources would be an important part of his administration’s energy policy. The first environmental hearings on the proposal are under way this week, focused on the impact of new seismic exploration off the Atlantic Coast.

Oil companies also are vying for leadership in opening up vast underwater reserves around the world, such as off the coasts of Angola and Brazil. Transocean says it is the largest offshore drilling contractor, and its fleet catalog says it holds 19 of the last 23 world records for drilling in deep water.

BP, which recently obtained a stake in offshore Brazil, has more acreage than any other producer in the Gulf of Mexico, and sought to solidify this position with the announcement of its Tiber Prospect discovery last fall.

At the time of the big BP find, experts cautioned it could take years to begin extracting oil from Tiber, and the project would make sense only if global crude prices were high, because of the difficulty of extraction from so deep underwater.

Dangerous Work

Indeed, the work can be hazardous. There have been 509 fires recorded on oil platforms in the Gulf of Mexico since 2006—including nine characterized as “major,” killing two people and seriously injuring 12, reported the Houston Chronicle in an analysis of the accident records of the U.S. Minerals Management Service. The Chronicle said there were at least 35 fatal platform accidents in the Gulf during that period, including drowning and diving incidents, helicopter crashes, and drilling equipment mishaps.

Ken Medlock, a fellow in energy studies at the James A. Baker III Institute for Public Policy and adjunct assistant professor of economics at Rice University, said he didn’t think the fire would have much effect on the continuing oil operations in the Gulf of Mexico. “It shouldn’t mean anything for those in production,” he said.

The National Oceanic and Atmospheric Administration reports there are nearly 4,000 active oil and gas platforms operating in U.S. waters in the Gulf of Mexico.

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