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Senate Committee Hearing on BP Oil Disaster

9:55 am in Uncategorized by Scarecrow

Watching the Senate Energy and Natural Resources Committee hearing on the BP Oil Disaster it’s hard not to be discouraged by the spectacle. Even before the Committee gets too deep into questioning the executives from BP, Transocean and Halliburton, the Senators’ questions of the setup panel inadvertently revealed they are as much a part of the problem as the companies they’re trying to nail with responsibility.

That became obvious during the initial panel composed of a Texas A&M Associate Professor and former drilling engineer, F.E. Beck, and Elmer Danenberger, who until January was the head of the Minerals Management Service responsible for overseeing off-shore oil drilling.

Beck was competent and helpful in describing industry practices. He discussed general drilling procedures and safeguards, but he disclaimed expertise in deepwater drilling, meaning the Committee had the right idea but the wrong witness.

Former MMS director Danenberger, on the other hand, came off as a perfect example of someone you’d never allow to be a regulator, as the questioning by Ron Wyden revealed.


Danenberger represents the view that if something awful hasn’t happened to you, you don’t need to think about the worst that could happen. So you don’t have to plan for it, let alone consider the possibility of catastrophic failure and its consequences when you’re deciding whether to allow the activity in the first place. That is, by the way, the essence of US energy policy, now fully embraced by the Obama Administration and most in Congress. Danenberger represents how our government thinks.

But the problems with government oversight of a dangerous industry with plenty of money and influence were best illustrated by the Senators themselves. With only a couple of possible exceptions (Sen. Bob Mendendez of NJ; Ron Wyden of Oregon), the Senators start with the conclusion that should be waiting for evidence to support it: that no matter how dangerous this activity is to the lives of workers or how devastating it may become to the environment and economy of the Gulf, we’re going to continue doing this, because we’re not prepared to do something different.

So we heard Mary Landrieu (D. La) use all of her time reading a statement about how much her state depends on oil industry jobs, how many wells we’ve drilled that didn’t blow up (as though somehow that mattered), and how much oil we get from the region. She told us none of the many spills to date had been this big, as though that was supposed to be reassuring. Not once did Sen. Landrieu tell us how may people in the Gulf region depend on the health of the Gulf or how many communities in her state and others could be decimated by this catastrophe.

Senator John Barrasso (R. Wyoming), not willing to ask whether the technologies we have for deepwater drilling may not be reliable enough to trust with the life of the Gulf, wanted to know instead whether terrorists might have had an opportunity to sabotage the blowout preventer? The witnesses essentially dismissed the notion, dealing a blow to Russ Limbaugh; the equipment failed, so now Barrasso has to deal with it.

But the prize for stooge of the morning must go to Senator Jim Risch, (R. Idaho), who began by saying we must and will continue deepwater drilling, a view probably held by many who are unwilling to think we might move in a different direction. So what to do about the inevitable accidents we have to accept?

Risch stated emphatically that since government is incompetent — Ronald Reagan said that, so it must be true, and if not, let’s make it so — it’s wrong to entrust government with the task of "provide for the public welfare." Since a government regulatory effort so small it can be drowned in a bathtub can’t be trusted to perform the public health and safety function, Risch reasoned, why shouldn’t we let the industry form a private organization to set and oversee safety standards? He doesn’t seem to realize that industry had already gone a long ways towards turning MMS into that model.

A second Senate Committee hearing continues this afternoon with questioning of the industry execs.

More:

AP: Oil spill testimony to Congress: Not our fault

HuffPost/Dan Froomkin, Fingerpointing

McClatchy, US Agency let oil industry write offshore drilling rules

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Why BP’s Oil Disaster Scenario Wasn’t Considered During Environmental Review

6:57 pm in BP oil disaster, Energy by Scarecrow

Updated to include video from MSNBC’s Countdown.

The Washington Post ran a story today noting the Department of Interior’s Minerals Management Service (MMS) overseeing the Deepwater Horizon’s drilling plans never performed the thorough environmental assessment presumably required under the National Environmental Policy Act (NEPA).

The Interior Department exempted BP’s calamitous Gulf of Mexico drilling operation from a detailed environmental impact analysis last year, according to government documents, after three reviews of the area concluded that a massive oil spill was unlikely.

We can view this as another egregious failing by the corrupt MMS and its total capture by industry during the Bush era (and likely before). But the problem is more wide spread. The larger tragedy is that NEPA, once America’s premiere law for protecting the environment, has been steadily watered down under successive pro-business Administrations.

NEPA, the National Environmental Policy Act, is one of the core environmental protection statutes, passed in the same era that gave us the "Clean Water Act," the Clean Air Act, Endangered Species Act and the creation of the EPA. These were new statutes when I was a new attorney for a California agency decades ago. California’s environmental statutes were partly models of, or modeled after these seminal statutes, so we looked to NEPA cases to interpret our own CEQA statute.

NEPA does not set standards like emission limitations; other statutes and agencies do that. Instead, NEPA is mostly a process statute that imposes requirements on federal government agencies, and indirectly, on the public and private projects that need agencies’ approval.

NEPA basically says that no agency can take a major federal "action" (such as make a decision, adopt a plan, grant a permit, etc), without writing an "environmental impact assessment" (EIS) and considering it throughout the agency’s review/decision-making process. So when an agency contemplates taking a major federal action, like granting a permit to drill a well, it must create the EIS first and then use it to guide its decision making all the way through the final decision. And if an agency’s decision is challenged in court, the EIS becomes a key part of the agency’s administrative record to explain and justify its decision before the reviewing court. An agency decision that ignores its own EIS can be overturned.

The EIS must seek out and describe every potential significant adverse impact on the environment that is reasonably foreseeable from the agency action. That includes impacts of building and operating a power plant, creating a new road, constructing a large building, transporting toxic materials when an accident might occur, or drilling a new well, opening a new mine, etc).

If an EIS fails to include any potential significant impact, it is defective and thus so is the review process that leads to the agency’s decision. Courts have reversed agency actions not merely for failing to perform or write an EIS but for creating a deficient EIS that missed or mischaracterized a significant impact. So the impact statement must be based on competent studies by competent experts who know what to look for and how to think about potential advserse impacts on the environment.

In addition to identifying all significant impacts on the environment, the EIS must identify all reasonable measures to mitigate the impacts, determine whether the project will include those mitigation measures and the extent to which the impacts will, in fact, be mitigated. Further, the agency’s EIS must also evaluate reasonable alternatives to the proposed action — such as a different project, moving it to a better location, making it smaller, using a different technology, and a "no-project" alternative. The agency must then evaluate whether the significant environmental impacts can be avoided by doing something different or not doing anything. An agency is then under a duty to impose all reasonable mitigation measures before it can approve a project that the EIS finds would create significant environmental impacts.

So the NEPA is basically a "full disclosure" mandate for all agency actions that might impact the environment, a means to identify and select mitigation measures, coupled with the threat of reversal of the agency’s action for failure to provide full disclosure (or even to give adequate consideration to the EIS). Many federal actions/decisions have been overturned for failure to follow the full-disclosure and consideration of mitigation and alternatives process.

The NEPA statute was a huge advance in environmental protection. It stopped many awful projects dead in their tracks, forced project developers to scale back or revise their projects in order to avoid EIS findings of significant environmental impacts and the costs of mitigation. In addition to forcing developers to think about the environment, NEPA induced project developers to include more mitigation measures in their initial project proposals, knowing that the EIS would identify impacts and possible mitigation that the agency would have to consider.

NEPA worked exactly as expected. Early courts slapped down agencies for failing to perform EISs (which reversed the permits the developers needed to begin their projects). Courts reversed agencies for creating inadequate EISs. There are hundreds of cases defining what "significant," "impact" and "reasonable mitigation" and "reasonable alternatives" mean in every context. What is an adequate review of the EIS by the agency? An agency can’t ignore its own EIS; it has to be an integral part of the decision-making from day one.

The NEPA applies to agencies, but agencies imposed the costs of preparing an EIS on the industry proponents of each project. This meant a potentially large new cost to project developers.

As a result, the Act created a large cottage industry of people who perform environmental assessments and write draft EIS documents and supporting studies for the agencies. We created a class of scientists and environmental researchers and analysts and made their findings part of federal decision-making. Hooray!

Many industries who need agency approvals for their projects eventually created their own in-house EIS generators or relied on consultants offering an EIS service. They do the studies, write the supporting reports and testimony, and draft an EIS to hand to the agency to adopt as its own. A typical agency can then retain a smaller staff to just go over the draft EIS handed to them. Over time, this meant that agencies lost whatever staffs they once had to do the studies themselves or review them with sufficient expertise. With industry incurring the costs, industry worked to control the editing and the spin on the initial documents and limit the quality review by the agency. The agency staff then became, at best, the quality control, or at worst, the cover for a poor EIS, depending on regulatory capture and staff budgets (which were also influenced by industry and sympathetic legislators).

But the NEPA process can still be backed up by protest groups (anyone who opposes a project, for any reason) who can take an agency with a defective EIS to court to try to get a better EIS (or more likely, to stop the project). The NEPA EIS requirement can thus be an effective legal tool to stop, slow down, or change industry and government projects with egregious impacts.

Because the EIS can be a minefield and potential show-stopper for a project, industry has been working for decades to weaken NEPA by creating categorical exemptions for certain types of projects, or allowing the agency to do one generic EIS for a whole group of similar projects, instead of creating a project-specific EIS for each project. That’s apparently what happened with the Horizon well.

So it would have been perfectly normal for the MMS to use a scaled down or "generic" EIS over and over for well after well in the Gulf, and to incrementally create a cursory EIS process that was so watered down that it effectively said, "nothing here, move along." And since really bad things can’t happen, then adverse impacts won’t occur, so no further mitigation is required.

And as each scaling back sneaks through the now more conservative, business friendly courts — who have long since ceased to be the activist environmental safeguards they were in the 1970-80s — the power of the EIS to force agencies to make better environmental decisions has slowly and tragically declined.

So when pro-industry, anti-environmental politicians tell us that the BP oil disaster met all the environmental reviews, and what happened was just an "act of God," just remember that industry lawyers have been working for decades to make sure government agencies think that way and have even less information before them to see it any other way.

Halliburton Presentation May Explain Horizon Oil Rig Explosion and Fire

1:53 pm in BP oil disaster, Energy by Scarecrow

What More Can Halliburton Tell Us About the Horizon Oil Blowout and Its Risks?

A publicly available Halliburton PowerPoint presentation from last November might tell us a lot about what could have caused the oil blowout, fire and massive oil gushing at the Horizon rig.

Suppose you’re that division of Halliburton that has the dangerous job of "cementing" the drilling hole and the gaps between the hole and pipe. You’ve done this lots of times in shallow water wells, but you’ve learned through previous experience in deep water there’s a particularly difficult problem having to do with the presence of gas that has seeped to the ocean floor and been captured in essentially "frozen" crystallized formations.

The problem is that when you drill into these formations, and then try to inject cement into the hole/gaps to prevent leakage, the curing process for that creates heat. That heat can, if not controlled, cause the gas to escape the frozen crystals. If a lot of gas is released all at once, as could happen during the cement/curing process, it can cause a blowout where the cementing is occurring, or force gas and/or oil up the pipeline to the drilling rig on the surface. And the heat created by the process may be just enough to ignite the gas [or more likely, a spark at the rig -- see comments 81, 85], causing the explosion and fire.

Did this happen at the Horizon rig? And if Halliburton already knew about this problem months (years) ago, and knew the risks it might create, why are we just now learning about this?

From Halliburton’s presentation (large pdf), page 10, last November (my bold):

Challenges

• Shallow water flow may occur during or after cement job
Under water blow out has happened
• Gas flow may occur after a cement job in deepwater environments that contain major hydrate zones.
• Destabilization of hydrates after the cement job is confirmed by downhole cameras.
• The gas flow could slow down in hours to days if the de- stabilization is not severe.
• However, the consequences could be more severe in worse cases.

Page 13 lists the design objectives but then concedes they can’t all be met at once:

Deepwater Well Objectives
• Cement slurry should be placed in the entire annulus with no losses
• Temperature increase during slurry hydration should not destabilize hydrates
• There should be no influx of shallow water or gas into the annulus
• The cement slurry should develop strength in the shortest time after placement
Conditions in deepwater wells are not
conducive to achieving all of these
objectives simultaneously

The presentation goes on to explain various options for dealing with the risks and assess the relative merits and costs. What’s interesting is that Halliburton appears to have been working at the edge of the technology and was not certain what would happen. Most experience was in shallower waters and no one was certain what would happen in deep waters. It conducted tests, but it’s not clear how complete or realistic those tests were or how costs factored into the choice of techniques. From page 23:

Destabilization of hydrates during cementing and production in deepwater environments is a challenge to the safety and economics

I think we’re about to learn a lot more about how cement cures and interacts with gas-locked crystaline formations in deep water drilling.

Update: See, alternative explanations at The Oil Drum, Tech Talk: Revisiting Oil Well Pressures and Blow Out Preventers . . .. Reacting to a discussion of the cementing issues in the [May 1] LA Times, the author says "it is hard to see from what is known, that this was a cause in this case," though not all commenters there seem convinced.

h/t to Cynthia Kouril who seems to know about how cement cures underwater — tunnels into New York — and found the presentation.

Halliburton presenation below:

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