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BOE applauds retired offshore regulators Ian Whewell (UK HSE) and John Clegg (NOPSA Australia) for their excellent participation in yesterday’s hearings. No one is wiser than a retired regulator. 😉

Also, Magne Ognedal overcame technical glitches to make an important long-distance contribution from Norway.  Those who have not yet read our interview with Magne should take the time to do so.  In this interview, which was conducted before Macondo, Magne concisely answers most of the questions about the Norwegian regime and regulatory philosophy that have arisen since the blowout.

In addition to suing for damages, the Justice Department is seeking civil penalties.  The amount has not been specified.

In the complaint, the United States alleges violations of federal safety and operational regulations, including:

  • Failure to take necessary precautions to secure the Macondo Well prior to the April 20th explosion;
  • Failure to utilize the safest drilling technology to monitor the well’s condition;
  • Failure to maintain continuous surveillance of the well; and
  • Failure to utilize and maintain equipment and materials that were available and necessary to ensure the safety and protection of personnel, property, natural resources, and the environment.

President-elect Dilma joked recently that the oil discoveries were just the latest proof that God is Brazilian. And economists from Goldman Sachs no less are predicting that Brazil — along with Russia, China and India — will dominate the world economy in the 21st century.

If you didn’t see the 60 Minutes story on Brazil, you can view it here. With regard to the significance of Brazil’s recent deepwater discoveries, OGX owner Eike Batista offered the following:

Oh, it, it means we should be producing in excess of six million barrels a day. So it’ll put us in among the third, fourth largest producer in the world. Massive exporting.

According to this blog entry, Batista forecasts this 6 million bopd production rate (more than double the current output) by 2020!

Like other offshore producers, Brazil has experienced its tragedies, most notably the sinking of the P-36 production platform that resulted in 11 fatalities. Petrobras and Brazil have recovered nicely from that disaster, but outstanding safety performance is critical if they are to sustain their offshore success.

Agenda

Live Webcast

Globe and Mail report:

“I will be contacting the federal government to begin discussions about the setup of a stand-alone regulator,” Premier Kathy Dunderdale said to applause in the House of Assembly Monday.

The province’s action is in response to a recommendation in Judge Wells’ report on last year’s helicopter crash that killed 17.

Good Platt’s Column

This is a very good column that we are posting with the permission of Gary Gentile, Platts Oilgram.

Top 10 Twitter trends for 2010:

1. Gulf Oil Spill
2. FIFA World Cup
3. Inception
4. Haiti Earthquake
5. Vuvuzela
6. Apple iPad
7. Google Android
8. Justin Bieber
9. Harry Potter & the Deathly Hallows
10. Pulpo Paul

Pre-Macondo poll numbers I would like to have seen:

  • Percentage of adult Americans (outside of the Gulf Region) who knew there was offshore oil and gas production in the Gulf of Mexico.  Based on conversations I’ve had with people in the DC area, I’m guessing less than 50%. I know that sounds astounding, but that’s my guess.
  • Percentage of adult Americans who had heard of the Minerals Management Service (probably less than 2%) and knew that the MMS had regulatory responsibilities for offshore oil and gas operations (had to be less than 1%).

Based on the chart above, I think we can now safely declare that the 2010 hurricane season is over. While the threat of tropical storms posed some problems for the Macondo response, the Gulf of Mexico was spared any significant damage or suspensions of production.

During the post-Macondo discussion about safety and regulatory issues, not much has been said about the major disruptions caused by Hurricanes Ivan, Katrina, Rita, Gustav, and Ike, and the attention and resources that have been dedicated to hurricane issues for the past five years. Major advances have been made in mooring capabilities and assessments, design standards, securing topsides equipment, and other aspects of hurricane preparedness.

How much did hurricane issues affect the assessment and management of other operating risks? This question may merit further attention.

Mars TLP took a direct hit from Hurricane Katina with sustained winds >150 mph

Shell’s submission to the BOEMRE provides more details on discharge plans for their Beaufort Sea exploratory drilling, and confirms that all muds and cuttings generated in drilling below the 20″ casing will be transported out of the Beaufort for disposal.  Shell also plans to transport gray water and sanitary wastes, bilge, and ballast water to approved discharge sites. This is about as close as you can get to true “zero discharge” when conducting exploratory drilling from a floating drilling unit.
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Shell has agreed to transport its used drilling fluids from Beaufort Sea exploration drilling out of the Arctic if the company finally gets government permission to drill a well next summer. Alaska Journal of Commerce

I assume this includes all drilling fluids and drilled solids (cuttings) except for the spud mud and cuttings generated prior to installing the riser?  If so, I believe this will be a first for an exploratory well drilled from a floating rig in US offshore waters.