To Drill or not to Drill- that is the question!

Greenpiece, many liberal, and a few less informed conservatives are pushing for No more drilling in the USA because of the BP incident offshore. No oil or gas exploration or production onshore and offshore point forward, because we "can't afford another disaster" according to Greenpiece?

Which potential disaster do you think is worse?

-Continue drilling with enhanced safety and quality protocols to maintain less dependence on imported oil, or

- following Greenpiece's call which would result in greatly increasing foreign oil imports by ship tankers that have a much worse safety/ spill record, even counting the Exxon Valdez incident.

According to the USCG, 35.7% of the volume of oil spilled in the United States from 1991 to 2004 came from tank vessels (ships/barges), 27.6% from onshore or shallow water topside facilities, 19.9% from non-tank vessels, and 9.3% from pipelines (mostly hurricane damage related spills); 7.4% from mystery spills. (Most of these non-vessel recorded spills involved very small amounts of oil being released.)

Okay, so if you have been following my comments to other’s posts, you've noticed the fact I tend to be.... Well, a bit opinionated and outspoken from time to time... My main focus is truthful opinion and sharing of facts regarding controversial subjects. Some of the time the truth shared is of the type that many can’t handle. Anyway, on to the topic = The BP Gulf Oil Spill !

1. Why did it happen & Who is to blame? (Will BP survive in the USA after this?)

2. How can it be fixed? (Will BP pay for everything or not?)

3. How can we move forward afterwards? (Should offshore drilling be allowed?)

These are the burning questions everyone seems to be focusing on…

One popular knee jerk reaction was to “Stop ALL evil drilling in the deepwater areas”. Well we only control USA areas so that ban only hurts US based businesses and helps foreign. However, this ban would certainly reduce the likelihood of future similar spills… That would be great except other than hurricane storm damage, and the Exxon Valdez oil tanker deal, can you name any other big oil spills? ( doubt it)

Remember we already import ~ 60% of our oil from OPEC and other foreign sources; we internally supply only 40% with most of that 40% is from deepwater sources. Oil and gas are still expected to provide over 80% of all energy for the next century according to professor, Michael Economides. Also plastics in bottles and jugs, polymers in cars, shoes, and chemicals also come from oil& gas.

Does it matter to you if oil prices go to $150 or $200 / BBL and OPEC laughs at us? (I bet It will matter when you pay $4 or $5+/ gallon for gasoline). Does it matter if hundreds of thousands of skilled jobs are lost with many of those technical professions moving overseas to work and live? Remember my fellow democratic those mostly “ overly privileged/ educated" technical professionals" moving away are the ones actually paying the high taxes which pay for welfare, Medicare, and obamacare… I digress, back to the point.

How did it happen?

We have all been hearing bits of the story about the Transocean’s Deepwater Horizon mobile offshore drilling unit (MODU) explosion on April 20, 2010 in a well being drilled in Mississippi Canyon Block 252 (~ 5,000 foot water depth) that claimed 11 lives. The players involved are BP (the deep pocket operator that “rented” the rig and managed the D&C project), Anadarko ( minority investor partner with BP), Transocean ( the owner / marine crew supplier of the destroyed rig), Halliburton ( Dick Cheney’s old company that had equipment and workers on the rig doing the bad “cementing” job on the well’s riser string), Cameron ( the designer /fabricator of the faulty Blow Out Preventer (BOP), and the DOI MMS (Mineral Management Service that is the regulatory agency that permits and oversees such work).

Three basic reasons or causes of failure seem to exist.

1> Fail safe/ bad BOP design, fabrication and testing

2> Drill operations/ bad cementing program

3> Project management, safety, & quality process/ bad management direction and poor inspection

That is it guys. If anyone of the above issues worked normally or at least mostly correctly the massive spill would never have happened.

According to Ray in Lake Charles, it appears that the Cameron brand BOP (Blow Out Preventer) was BP modified, ordered by BP to be rush delivered without normal inspection or testing, and this rush resulted in accumulator leaks for the weird ram design plus a dead battery? … Therefore the fail safe failed to work for the first time in offshore deepwater history. (Some could say it was criminally sabotaged)

According to nola.com, the Halliburton cement job failed but BP didn't want to set another plug and that the mud shouldn't have been displaced with seawater until the section was sealed off. The second cement plug was not set before the blowout. (You may have heard that Schlumberger walked off the job earlier due to issues with the BP team)

According to misc sources, the drilling & completions for the well had many problems and was managed in a very non standard way. A number of atypical risks or dangers existed including the basic approach with a long continuous drill string (a design which only BP does), the bypass or lip service to BP’s normal project stage gate MPCP type process (again hard to believe but minor versions of this have happened in the past due to the big company bureaucratic style of BP), the lack of thickness of the cement plug and lack of appropriate cure time, the relationship and alleged manipulation of the government inspection/ permit officials ( this resulted in the bypass of the layer of quality and safety protection which is very hard to believe since the MMS is usually overly conservative if anything).

Common sense management and engineering practices as well as standard regulatory oversight should have stopped this system-wide failure. This was a case of repeated mistakes by lots of folks, as well as a breakdown in procedures, testing, equipment and how the well was sealed.

Who is to blame? (Will BP survive in the USA after this?)

The mindset and political nature that has made BP what BP is and has been for the last decade + is to blame. That same “nature” has fermented and spread like a cancer over the years to infect many people and many associated companies.

How many times have vendors to BP joked about the “BP factor”?

Where costs are double or triple the industry norm but so is the aggravation from committee based indecision, confusion and what is usually overly elaborate, overly conservative, overly redundant custom design or modification. Vendors hate it usually, but BP does pay well (or did pay well anyway). BP usually staffs their own engineers and quality inspectors and tends to take the job away from the vendor’s ability to contribute. Therefore many vendors tend to be apathetic and just let BP do their thing.

The Cameron BOP failure is a shocking case where this BP factor really worked against common sense and public safety.

Politics side:

Liberals like Speaker Pelosi are blaming George Bush and Dick Cheney. Somehow their cronyism and backdoor deals for big business over the working man factor into blame (what a surprise). Right wingers blame liberal’s for setting America & therefore BP to go down the path toward socialism and political correctness. This could be related to the BP factor mentioned above. (Also BP was Obama’s biggest oil & gas $$ supporter after all. BP has also been commonly known as the most “liberal leaning” of all oil& gas firms… Hmm)

How can it be fixed? (Will BP pay for everything or not?)

Tech:

The relief wells now expected in a couple months will work. The other plans like top kill, etc had no real chance of working. This was known to insiders and government long ago but they had to try them anyway for PR purposes.

$$:

BP and in cases the taxpayers and oil industry workers will all pay. It may well go over $10 billion, so large parts of BP’s assets will be sold. Odds are good that Obama will take over US operations at least of BP similar to the GM deal.

How can we move forward afterwards? (Should offshore drilling be allowed?)

If the question were “how should we move forward” then the answer is:

· Punish BP ( and that “unaccountable, PC, anti-American mind set”) : A fine ~ $1 billion plus costs of spill and remediation. Also do NOT permit BP to drill offshore or arctic for 1 to 5 years. Consider it some kind of corporate prison sentence. Individually upper, middle and project management should be investigated and prosecuted accordingly, but with care. Their approach was engrained into to them over the years by our left leaning culture and BP’s ultra liberal D&I system so they have some excuse. Certain people within Cameron and Halliburton and possibly Transocean should also be investigated, but I suspect their shortcomings are limited.

Do NOT punish other companies. Wrecking an entire industry over what 1 small group of “criminally negligent” people did while breaking BP rules, practices as well as MMS rules is not reasonable or American. Lift the 6 month ban on deepwater drilling ( for others) asap subject to:

1) Adding a mandatory 3^rd party verification process to drilling, cementing and BOP design, fabrication and testing. This means another “layer of protection and oversight” will be added that will report directly to the MMS. The people doing this kind of review must be independent of the operator and specialists in this technology.

2) Add a mandatory factory acceptance functional test for BOPs. Not having the success test passed certified should mean mandatory fine and possible jail for manufacturer & operator’s executives involved.

3) Joint Industry funding of study to find ways to deal with this issue should it somehow ever happen again. I do not recommend waiting for the “solution” but a budget for the study and a large budget for the construction and testing of whatever equipment is created should be in place and in escrow.

This event should never have happened and never has happened before in the past decade of deepwater drilling. The causes were egregious and in many ways criminal and almost intentional by a misguided few individuals – not an entire company.

No one shut down all aircraft flights due to a single or even a few plane crashes due to faulty, untested equipment or even high jacking?

Better analogy:

If you work for Company “B” and you rent a Toyota Camry from Hertz on the job. But you’re a big wig with a big company and you yell at Hertz to burry up and get you a car right NOW! You push them to give you one that is in the shop. They agree. You are driving like a jerk and “maybe” even breaking a law, but something in the engine breaks it was in the shop remember?), and then the brakes fail (hey, that was another reason it was in the shop.. lets nickname the brakes “BOP”), then “you” cause a massive accident hurting people and damaging property and environment until you eventually, maybe with some police (government) assistance, get it STOPPED…

Then should the company you work for, Company “B” be liable for everything? …Better question- should Companies “A, C, E, S, etc” also be severely penalized because they are in the same industry as "B" for that crazy situation caused by staff of Company "B" ? The punishment all these companies are getting is the losses and layofs caused by the government's 6+ month HOLD on future business (ie: deepwater drilling ban) ?

Knee jerk reactions are usually wrong. What do you think?