April 17, 2011 in Nation/World

Oil firms submit new plans

Standards inadequate, ocean groups say
Renee Schoof McClatchy

WASHINGTON – Oil companies recently turned in their first plans for exploratory drilling in deep waters of the Gulf of Mexico, including new information the government has required since last year’s BP blowout about how they’d try to prevent and cope with another oil disaster.

The oil companies that want to explore the seabed below the deep water say they’ve learned from last year’s accident and have better plans in place than they did a year ago.

Environmental groups cited several reasons the plans fall short: The system to capture oil at a broken wellhead still hasn’t been proved in the very deep waters; systemic problems with blowout preventers haven’t been solved, and companies were too optimistic about how quickly they could drill the kind of relief wells that ultimately plugged the BP spill.

Government regulators put three exploration plans up for public review earlier this month. The three plans – from Shell Oil, Statoil, the Norwegian state oil company, and BHP Billiton of Australia – follow the government’s new regulations by spelling out details of what worst-case scenarios the companies expect, how they calculate it, what they’ve done to reduce the risk of a blowout and what they’d do to stop the oil if prevention failed.

The Interior Department’s drilling regulatory agency on March 21 approved the first exploration plan – one by Shell Offshore Inc. to drill three wells at 2,950 feet deep. Interior Secretary Ken Salazar said that it met a “strong new standard for safety and environmental protection.”

Environmental groups expressed concerns during the review period, which ended this past week.

“We’re being told don’t worry, we have these new safety standards. But when you look at what it is, what they have to prove, it’s not very satisfying,” said Jackie Savitz, director of pollution campaigns at Oceana, an ocean conservation group that opposes an expansion of offshore drilling.

Shell Oil, Statoil and BHP Billiton say they have a new system to cap and contain oil in case of an accident and that they’d be able to drill relief wells faster than the five months BP needed last year for the Macondo well.

The exploration plans must be approved before companies can apply for permits to drill. Regulators have approved permits to drill 10 deep-water wells since a post-spill moratorium was lifted.

Oceana and another group, Environment America, argued in written comments that the companies underestimated the time it would take them to drill a relief well. BHP Billiton said it would take 81 days; Statoil said 62 days; and Shell said 128 days.

The environmental groups argued the time probably would be longer, meaning that more oil would flow over a longer period than the companies’ plans show.

They said that the government should require the companies to dig a relief well at the same time as they dig the exploratory well as a precaution or have a drilling rig standing by ready to dig. The companies told the government they each had two rigs that would be in the Gulf and could be called into service. The environmental groups said those rigs would be doing other work, which would delay them from getting started on a relief well.

Shell, Statoil and BHP Billiton all are members of Marine Well Containment Co., a Houston-based consortium that says its containment system is ready for deployment, could operate in 8,000-foot depths and could process 60,000 barrels of oil a day.

The plans don’t say how long it would take to cap a broken wellhead. Shell’s plan, for example, says only that the equipment could be brought in rapidly.

Marine Well Containment Co. was formed last July. It owns and maintains a containment system that it says is significantly better than previous systems in the Gulf. Houston-based Helix Energy Solutions Group Inc., whose equipment was used in the BP spill, also has equipment to cap a well in deep water.

“The big change compared to how things were before Macondo is that we now have a capping and containment solution for each and every well. That is a big change,” said Ola Morten Aanestad, a Statoil vice president and spokesman in North America.

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