June 21, 2011 by offshoreenergy
BP settled Macondo litigation with Weatherford, manufacturer of the float equipment equipment used in the Macondo well. The failure of this equipment was a key contributing factor in the Macondo blowout. Under the agreement, Weatherford will pay BP $75 million. This money will be applied to the $20 billion Macondo trust fund.
Weatherford is the first of BP’s contractors to formally agree with BP that the entire industry can and should learn from the Deepwater Horizon incident. Accordingly, Weatherford has committed to working with BP to take actions to improve processes and procedures, managerial systems, and safety and best practices in offshore drilling operations. BP and Weatherford will encourage other companies in the drilling industry to join them in this improvement and reform effort.
Comments:
- $75 million seems like a rather modest payment by Weatherford given the magnitude of Macondo damage costs. BP will “indemnify Weatherford for compensatory claims resulting from the accident.” Presumably, Weatherford’s sales agreements provide good legal protection.
- One of the root causes of the Montara blowout was also a float collar failure. That float collar was also supplied by Weatherford. I’m surprised that this common cause and supplier have received almost no attention. Of course, no one has paid much attention to Montara, either before or after Macondo. Had more attention been paid to the Montara inquiry, Macondo might have been avoided. (Note that most of the post-Macondo commentary still implies that deep water is the threat even though Montara was in 80 m of water and the root causes of Macondo were not water depth related).
- When do we learn more about the “improvement and reform effort” described in the quote above?
Posted in accidents, well control incidents | Tagged accidents, blowouts, bp, Deepwater Horizon, drilling, float collar, Gulf of Mexico, macondo, Montara, offshore drilling, safety, Weatherford, well control | 2 Comments »
June 18, 2011 by offshoreenergy
Resources Minister Martin Ferguson is determined to establish a single national regulator after the Montara oil spill in the Timor Sea leaked oil and gas condensate for more than two months in 2009.
The WA government is at odds with Mr Ferguson over plans for a national regulator and wants to maintain responsibility for oversight of the industry in the state.
Senator Eggleston and Senator David Bushby said the federal government had introduced the legislation to parliament before concluding ongoing negotiations with the WA government. Herald Sun
Meanwhile, still no news regarding any penalties for Montara operator PTTEP. Will there be none?
Posted in accidents, well control incidents | Tagged accidents, Australia, blowouts, Montara, offshore drilling, well control, Western Australia | Leave a Comment »
June 17, 2011 by offshoreenergy
Perhaps the congressman was “distracted” when he chose to sponsor these two bills:
No New Drilling Act of 2011: Amends the Outer Continental Shelf Lands Act to prohibit the issuance of any lease for the exploration, development, or production of oil, gas, or any other mineral on the outer Continental Shelf.
Alaska Oil Drilling Leases: To prohibit the Secretary of the Interior from selling any oil and gas lease for any tract in the Lease Sale 193 Area of the Alaska Outer Continental Shelf Region until the Secretary determines whether to list the polar bear as a threatened species or an endangered species under the Endangered Species Act of 1973, and for other purposes.
Posted in Uncategorized | Tagged Anthony Weiner, offshore drilling, offshore energy | Leave a Comment »
June 17, 2011 by offshoreenergy
High-ranking congressmen made a concerted effort to financially distance themselves from BP in the aftermath of the Deepwater Horizon oil spill, either by reducing or altogether dumping their stock holdings, according to a Center for Responsive Politics analysis of lawmakers’personal financial disclosure documents released Tuesday.
House Speaker John Boehner (R-Ohio) and Sen. John Kerry (D-Mass.) gave up all or a significant amount of their holdings in BP after the 2010 spill, which leaked an estimated 205 million gallons of oil in the Gulf of Mexico and killed 11 oil platform crew members in the initial explosion. Open Secrets Blog
Financial decision? Moral leadership? Fear of guilt by association? Washington front-running? Political weakness? I wonder where they reinvested their money.
More on lawmakers’ finances.
Posted in accidents | Tagged bp, macondo | Leave a Comment »
June 16, 2011 by offshoreenergy
Because of recent involvement with products and systems that have Safety Integrity Level (SIL) ratings, I read the comment (below) in the PSA Deepwater Horizon review with interest. While administrative and effectiveness issues must be carefully assessed, the application of SIL should be part of the BOP performance dialogue. SIL ratings may also be appropriate for entire well control or well integrity systems.
Today’s requirements stipulate a risk analysis for the control system of a drilling BOP, with specified minimum requirements for its safety integrity level (SIL). As a result of the DwH incident and of the fact that blowouts are not confined to drilling operations, the question is whether such an analysis, with a specified minimum SIL level, should also apply to all types of BOPs, including well-intervention models. In addition, consideration should be given in this context to whether other control and management systems related to well integrity/control exist which should be subject to such requirements.
Posted in accidents, Norway, Regulation, well control incidents | Tagged accidents, blowouts, BOP, Deepwater Horizon, macondo, offshore drilling, safety, SIL | 2 Comments »
June 15, 2011 by offshoreenergy
In their comments on the Coast Guard’s Deepwater Horizon Joint Investigation Team Report, Transocean made these statements about BOP maintenance standards incorporated in MMS drilling regulations:
By glossing over the contours of the regulatory language, the Draft Report unilaterally converts API Recommended Practice 53 from an advisory guideline into a mandatory requirement. Notwithstanding the Draft Report’s insistence otherwise, the API’s recommendation that the BOP “should” be disassembled and inspected according to the manufacturer’s guidelines is not mandatory. The API clarifies that the word “should” indicates a recommended practice for which a comparably safe alternative is available or which may be impractical or unnecessary in some conditions. In contrast, to denote a recommended practice that is “advisable in all circumstances,” the API uses the word “shall.” The API also emphasizes that “the formulation and publication of API standards is not intended in any way to inhibit anyone from using any other practices.” Though it recommends specific practices, API acknowledges that “equivalent alternative installations and practices may be utilized to accomplish the same objectives.” On its face, the language of API RP 53 makes clear that the recommendation that the BOP “should” be disassembled and inspected in accordance with the manufacturer’s guidelines is a recommendation, and nothing more.
Although the MMS regulations governing BOP maintenance incorporate API RP 53 sections 17.10 and 18.10 by reference, this does not convert the API’s recommendations into a mandatory requirement. As the MMS has clarified, “[t]he legal effect of incorporation by reference” is merely that “the material is treated as if it were published in the Federal Register.”
Treating API RP 53 as if it had been published in the Federal Register does not imbue its language with more regulatory significance than it had before. The API’s recommendations regarding BOP maintenance—as well as the API’s acknowledgement that alternative practices “may be utilized to accomplish the same objectives”—remain recommendations, not requirements. Transocean’s complete comments are posted on their website.
I’ll withhold my comments on the above statements, except to say that my opinion differs substantially from Transocean’s.
More significantly, these and other recent industry and government comments demonstrate the complexity of standards policy issues. How are standards most effectively applied by operators in formulating safety management programs, operating plans, and safety cases? Contractors? How should deviations from standards be assessed and documented? How should regulators use standards? To what extent should standards be incorporated into regulations? What is the appropriate role for regulators in standards development? These issues may prove to be more challenging than updating technical requirements. Stay tuned!
Posted in Regulation | Tagged Coast Guard, Deepwater Horizon, drilling, macondo, Regulation, safety, standards, transocean | 2 Comments »
June 14, 2011 by offshoreenergy
This excerpt from a University of Michigan article describes the engineer’s paradox:
For engineers, failure and risk have a special relationship. If they don’t take risks they never do anything new. But if they do take risks, their probability of failing increases. So engineers must welcome risk and the opportunity to learn from failure, but they must make every effort to succeed. This leaves engineers in the odd predicament of becoming less informed as they become more successful. In that light, bad judgment could be an invaluable but potentially lethal experience. Conversely, evidence shows that experience fosters good judgment – the longer people do something, the more likely they are to make decisions, and in making them they’ll acquire not just an appreciation for the difficulty of rendering good judgments but the skill to do it well.
Comments:
- Society is dependent on engineers taking risks. These risks can be managed, but not totally eliminated.
- The oil and gas that are produced offshore support economic development and technological advances that make our lives safer and cleaner.
- Importing energy transfers some risk to other locations, but does not reduce (and may actually increase) the overall risk associated with energy consumption.
- Experience matters. Optimal corporate and governmental risk management regimes emphasize the role of experts in making project-specific and programmatic decisions, and promote industry-government communication among specialists. Experience is not a conflict of interest!
Posted in Regulation | Tagged engineering, Regulation, risk management | Leave a Comment »
June 13, 2011 by offshoreenergy
A month ago, BOE posted a list of major accidents for which no official company or government reports had been released. Below is the latest update on these accidents. If you have updated information, or if there are other events that should be added to the list, please let us know.
The following recent accidents are on our “watch list.” Accidents are added to the “missing report list” when six months have elapsed since the accident.
Posted in accidents | Tagged accidents, offshore, safety | Leave a Comment »
June 11, 2011 by offshoreenergy
From the standpoint of post-Macondo safety and regulatory issues, this concise summary is the most comprehensive and useful report that I have read since the blowout.
I have pasted (below) comments about information management – one of the many important topics considered in the report – and hope you take time to read the entire summary. It is only 12 pages.
Conducting a critical review of the information used to manage major accident risk is one of the measures relevant for the companies. This work could include an assessment of
the relevance, reliability and modernity of the indicators used to follow up risk trends
inappropriate use of indicators, incentives and reward systems
the need for better indicators and other information about the business which can be used to secure an early warning about a weakening in safety-critical barrier elements.
The PSA is of the opinion that the quality of information applied in managing major accident risk is also a question of what overview the players have of their own business, and thereby a question of the players’ own control. The PSA assumes that managing major accident risk cannot be outsourced. In light of the DwH accident, it could be relevant for the companies to review the processes intended to provide the necessary information about the business, assess in part how these processes support a culture of accountability and how various management and audit functions, third-party verifications and so forth contribute in this connection.
Posted in accidents, Norway, well control incidents | Tagged accidents, blowouts, BOP, Deepwater Horizon, drilling, macondo, Montara, Norway, offshore drilling, offshore oil, PSA, safety, well control | Leave a Comment »
June 8, 2011 by offshoreenergy
Thanks to a reader, we have obtained a copy of a report on the Jack Ryan crane failure (August 2010) that killed one worker and injured three offshore Nigeria. As BOE readers know, we have been pursuing information on this accident for months.
At BOE our highest priority is drawing attention to and disseminating information on offshore accidents. In that regard, we greatly appreciate the support we have received from readers.
Excerpt:
Link to Jack Ryan report.
We understand that Total is conducting an inquiry, and assume that Transocean has also investigated this accident. We hope those reports are made publicly available.
Posted in accidents | Tagged accidents, crane, fatality, Jack Ryan, Nigeria, offshore drilling, safety | Leave a Comment »
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