Oil companies plan response system
$1 billion venture would keep equipment ready
NEW YORK – Big Oil is trying to assure Washington it’s prepared for the next big oil spill.
ExxonMobil, Chevron Corp., Conoco Phillips and Shell Oil said Wednesday they’ve agreed to pool $1 billion to form a new company that would respond to offshore oil spills at up to 10,000 feet underwater. The system would deploy equipment that could arrive at a spill within days and be fully operational within weeks, the companies said.
Members of Congress investigating the explosion of the Deepwater Horizon oil rig have criticized the oil industry for being ill-prepared for a major oil spill, and regulators want the industry to develop a thorough spill containment plan. Meanwhile, the White House has imposed a moratorium on deepwater drilling, and oil company share prices have plunged. Stricter regulations are also likely on the way for offshore drillers.
Michael Bromwich, director of the Bureau of Ocean Energy Management, the federal agency that oversees offshore drilling, said the announcement was encouraging.
“Ultimately we are exploring the changes and reforms that need to be made in deepwater safety standards, spill response and containment,” Bromwich said in a statement. “But steps like these move in the right direction.”
BP, whose blown-out well has leaked as much as 180 million gallons of oil into the Gulf, was informed of the venture but it hasn’t joined, a spokesperson for Exxon said. BP didn’t answer calls to comment about the new response system.
Attempts to plug the well were introduced with the caution that they’d never been tried a mile underwater. Exxon and the other companies on Wednesday promised their equipment will be tested beforehand.
The new system draws on lessons learned from BP’s efforts and uses some similar equipment. The companies say the equipment shouldn’t break down under extreme pressures and depths.
The response system will include an array of underwater equipment designed to create a permanent connection and seal over a busted well. It will separate oil from gas and bring it to the surface where the gas can be burned off and the oil can be stored on tankers.
The companies say the system could capture up to 100,000 barrels – 4.2 million gallons – of oil in depths of up to 10,000 feet, twice as deep as the waters BP was operating in. The four were not involved in the Gulf oil spill, but each rely on offshore drilling to generate significant revenue. Shell and Chevron have prominent drilling operations in the Gulf.