The industry is stepping up

The US oil and gas industry has mobilized dramatically in response to the Apr. 20 rig explosion and fire and subsequent crude oil spill in the Gulf of Mexico. US Interior Secretary Ken Salazar asked industry leaders to put their best people to work on finding out what happened and why, and report their findings to him by the end of May.

“Our best minds are working hard on this. It’s unprecedented,” a source told me on May 6. “This reaches across companies and trade associations like never before, with frequent conference calls and consultations. We’re determined to give the secretary what he needs. The stakes are that high.”

Salazar and US President Barack H. Obama’s measured statements since the accident and spill are encouraging, the source said, adding: “We’re not expecting much initially from Congress. Several members are too busy posturing. The administration’s attitude is what matters at this stage. So far, it has been good.”

That same day, the National Ocean Industries Association outlined how its members are lending their resources in an equally unprecedented cooperative effort to stop the flow of crude oil into the gulf.

“Our member companies want answers as much as anyone as to the cause of this event, and we understand the offshore industry will be closely examined by the authorities at the state and national level,” NOIA President Randall B. Luthi said. “The members stand ready to cooperate and assist as aggressively as we are in the response and cleanup efforts.”

ExxonMobil has offered the use of a drilling rig as a staging base, two supply vessels, an underwater vehicle and support vessel and has provided experts to respond to BP’s request for technical advice on blowout preventers, dispersant injection, well construction and containment options, according to NOIA. Shell Oil supplied six oil spill response vehicles initially for fire-fighting and search and rescue efforts, as well as a dynamically positioned vessel with a remote operated vehicle, an EC135 helicopter, an ROV hot-stab panel, dispersant, technical experts, and use of its training and conference center in Robert, La., to the Unified Command for accommodations and press conferences. ConocoPhillips, which currently has no operations in the gulf, nevertheless responded favorably to BP’s request to possibly use an adjacent lease for a relief well, and made available spill response equipment, chartered helicopters, marine vessels, and a pair of shore bases in Louisiana.

NOIA noted that the Marine Spill Response Corp. has coordinated aircraft spraying dispersants, along with six smaller planes which act as spotters; has six OSRVs actively at work at the site and two more en route from Maine and New York; three ocean barges on-site to capture and store oil which the OSRVs skim up; six fast-response vehicles and more than 2,000 MSRC staff and supervisory personnel helping to supervise more than 1,000 contractors.

The association’s list of participating members also includes offshore drilling contractors which compete with Transocean Ltd., owner of the sunken semi-submersible rig; independent producers; workboat operators, and other marine service and equipment suppliers.

“Everyone deserves to work in a safe environment, and while there are risks associated with every industry, that risk can be significantly reduced and managed through careful consideration and evaluation,” said Luthi. “Our industry operates using incredible technology that rivals the space program. This technology and the unprecedented cooperation from NOIA member companies will be key to developing a solution that stops this accidental flow of oil into the gulf, and helps to restore the faith of the American public in the offshore industry.”

It’s no time to be timid

Is there anyone who doesn’t realize the oil and gas industry faces its toughest political challenge in at least two years because of the Apr. 20 rig accident and subsequent crude oil spill? I didn’t think so. Unlike the 2008 crude oil price spike, however, this could be the kind of challenge that the industry handles well if it responds honestly and decisively to mounting cries of concern.

This didn’t happen in some obscure region, after all. It’s the Gulf of Mexico, where the offshore oil and gas industry began more than 60 years ago and where it has worked harmoniously with other offshore industries ever since. It may look ugly now, but what better place is there to demonstrate a solid offshore emergency response?

If this accident has done nothing else, it has reminded everyone that it can be dangerous out there, even with cutting-edge technology looking thousands of feet below the water’s surface. Every offshore producer, drilling contractor, and service company realizes that safe operations are essential because the risks can be great, even if the potential rewards are high.

Predictably, congressional and other opponents of expanded US offshore oil and gas activity are saying that this event demonstrates it’s too hazardous. The US Minerals Management Service and US Coast Guard’s joint investigation rightly focuses on finding what caused the accident and containing the spill. Other Obama administration departments and agencies are also looking for facts.

US Interior Secretary Ken Salazar ordered inspections on Apr. 30 of all 30 deepwater rigs and 47 production platforms in the Gulf. At his direction, MMS tried to determine that tests of blowout preventer stacks were completed, related records were available for inspection, and emergency well control exercises were taking place. As of May 3, two offshore platforms had stopped production and one was evacuated. Approximately 6.2 million cubic feet of natural gas was shut in, less than 0.1% of the Gulf’s daily gas production.

The situation changes by the hour. But it clearly gives the oil and gas industry an opportunity to show how far it has come since the 1969 Santa Barbara Channel spill. It should seize this chance.