Tuesday, 1 March 2011

Did Federal Rule Changes Contribute to the BP Disaster?

The federal Minerals Management Service (MMS) is the government office that is responsible for regulating offshore oil rigs. As part of those regulations, oil rig operators are required to submit to the government a "blowout scenario" that details how a company would handle a major spill if a catastrophe occurred on a rig. The type of catastrophe that is now playing itself out in the Gulf of Mexico, where the Deepwater Horizon oil rig exploded in the Gulf of Mexico on April 20, and sank, killing 11 workers.

The blowout scenario plans were supposed to require operators of oil rigs to estimate how much oil would be flowing from a well each day, and the total amount that might leak if there was a single incident. The plans should also explain how a spill would be stopped, what methods would be used, the amount of time it would take to stop a leak, how long the company would need to drill a relief well, and whether or not there was potential for a leak to stop on its own.

However, in 2008, the MMS changed its rules about blowout scenarios, saying that such plans were necessary only if certain conditions applied. For example, if a rig operator was going to install a facility on the surface to drill in water that was more than 1,312 feel deep, a blowout scenario must be filed. But according to BP spokesman William Salvin, the Deepwater Horizon project did not meet the established definition of "surface facility," and the MMS agreed. "The production platform is what’s considered a surface facility," said Salvin. "This was an exploratory well, not a production well." At the time the rules were changed, MMS said that BP met the conditions necessary for being exempted from having to submit a disaster plan, so the company had no specific plan for Deepwater Horizon. Savin has said in interview that despite the lack of a formal plan being submitted, the company was always prepared to handle a problem because of the detail in a 582-page plan they developed for the Gulf region to deal with a disaster on any of their rigs in that region.

However, the MMS has been criticized for a long time for being perceived as being too soft on the industry it is supposed to be regulating. In 2008, disciplinary action was pursued by the Interior Department against 8 employees of the MMS who were given lavish gifts and parties, and in some cases even had sex with some employees at the energy companies they were supposed to be regulating. The investigation found that employees in the Denver office of the MMS were engaged in a "culture of substance abuse and promiscuity," and MMS workers were required to undergo ethics training.

Brendan Cummings, a lawyer for the Center for Biological Diversity, told reporters that the exploration plan that was filed by BP for the Deepwater Horizon project did not analyze the risks of an oil spill in enough detail. On behalf of the Center, Cummings has filed suit against the government for another offshore drilling rig in Alaska, owned by Royal Dutch Shell. "The technology used on the now-sunken Deepwater Horizon oil rig in the Gulf was supposed to be the most advanced in the world, including various mechanisms to prevent or cap a blowout," Cummings said in filing the suit. "None of these mechanisms worked, and the state-of-the-art technology completely failed to stop the spill."

The lack of a plan being on record for the Deepwater Horizon is troubling, to say the least, because the drilling was being done in extremely deep waters and therefore a leak could be a catastrophic event. Many feel that the change in rules by the MMS resulted in an outrageous omission, and they were clearly not doing their job correctly, and that someone fumbled the ball terribly. In an exploration plan created by BP last year, the company discounted the chance of a catastrophic leak. In similar fashion, Shell created an environmental impact analysis regarding its Beaufort Sea underwater drilling plan. That analysis concludes that the possibility of a large spill of liquid hydrocarbon "is regarded as too remote and speculative to be considered a reasonably foreseeable impacting event."