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Posts Tagged ‘Australia’

In the Gulf of Mexico, deepwater drilling is more risky because that is where the high-rate wells are, not because the water is deep.
  • Water depth had little to do with the well integrity problems at Macondo. Similar errors in planning and execution would have yielded similar results in any water depth or on land.  Has Montara already been forgotten?
  • Subsea BOP stacks have a much better performance record than the surface stacks used in shallow water drilling (more on this later in the week).
  • Historical data indicate that blowouts occur less frequently in deep water, not more frequently (more to follow).
  • Obviously, blowouts involving high-rate wells are likely to do more damage.   This applies regardless of the water depth.   You can reduce the spill risk by prohibiting drilling in the areas with the highest production potential, but that wouldn’t be very sound energy policy and you won’t find many buyers for the leases.
  • It is safer to conduct intervention and capping operations on subsea wells.  Regulators would not even allow surface capping to be considered at Montara because of the high risk to workers.  The subsurface ROV work is perhaps the biggest Macondo success story.
  • If the Macondo well was in shallow water (with the wellhead above the water surface), and well integrity concerns precluded a risky surface capping operation, how would the flow have been contained and collected?
  • Other things being equal, the environmental risk is less at deepwater locations which tend to be farther from shore.

Water depth is just one well planning consideration.  Abnormal pressures and temperatures, shallow gas, hydrogen sulfide, ice, permafrost, storms, currents, extended reach targets, and horizontal completions are some of the others.  To prevent another Macondo, in the US or anywhere else in the world, we need to focus our attention on the 3 categories of issues listed below.  These issues are important in all water depths and in all environments.

  1. Well integrity including design, construction, barriers, verification, and monitoring.
  2. BOPE performance and reliability under all conditions.
  3. Capping, containing, and collecting oil in the event of a blowout.

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We believe that we should not start the static kill operation until we have installed the last liner run in the bottom of the relief well.  Admiral Allen

Comment: This is understandable given the potential for communication between the 2 wells at or near the reservoir level.

– There has been some media talk about allowing the well to flow during a possible hurricane evacuation.  I don’t see any direct quotes from Admiral Allen that specifically say that, so I hope these media reports are inaccurate.  As indicated in previous posts, this is an unnecessary measure that could be viewed as irresponsible.

-Safety Leadership has been a major emphasis of drilling contractor training programs in recent years.  Transocean’s program is summarized here.  Safety leaders create an environment in which each employee is comfortable raising any and all concerns without fear of repercussions.  Safety leaders are also encouraged to raise safety issues with the companies that contract their rigs.  Judging by comments at the BOEMRE-CG Macondo hearings, some DWH employees were not comfortable raising safety concerns to their supervisors or the operator.   During the Montara blowout hearings, there was evidence of similar reluctance on the part of contract employees.   Drilling and other contractors need to take a close look at their Safety Leadership programs and find out why these entrenched attitudes persist.

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“I will act promptly and appropriately on the report once I have had an opportunity to review its contents,” Minister Ferguson said.  18 June news release

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The Federal Government is unnecessarily delaying the release of a report into last year’s Montara oil spill off Australia’s north coast, the Northern Territory Opposition says.

link

On a related note, it would be great if preliminary findings from the DOI/DHS Macondo investigation could be released as soon as possible.  There is much work to be done and all interested parties (in the US and elsewhere) need the best available information so that they can assess their programs.  Better to err on the side of releasing findings to soon with any necessary caveats and disclaimers.  In that regard, the House Committee on Energy and Commerce has done a good job of making their findings available without delay.

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Varanus Island, Western Australia

Odd Finnestad, BOE’s Senior Vice-President for International Activities (note the recent promotion), and his talented, multi-lingual staff keep close tabs on investigations and accident reports worldwide.  Odd thinks we may be in for a long wait for the Montara report, so the BOE cyber vigil will not include any rash measures like hunger strikes.

While Australia does a great job of investigating, holding hearings, and preparing reports, they seem to struggle with the simple step of releasing those reports.  Odd reminds us that the report on the 2008 Varanus Island gas plant explosion has still not been released.  This important accident reduced Western Australia’s gas supply by one-third, and thus had major economic consequences. The Veranus report was finalized in June 2009, but maneuvering by the responsible party and legal reviews within the Western Australia Ministry for Mines and Petroleum have kept this report under wraps.  Now we are getting the same uncomfortable feeling about the Montara report.  Perhaps, Minister Ferguson will prove us wrong and release the Montara report without further delay.  We hope so!

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  1. The big question with regard to acoustic backup systems for BOPs is whether ambient noise associated with a seafloor blowout prevents the signal from being reliably received.  The Macondo well would seem to provide an excellent opportunity for testing acoustic systems to see how effectively the signals are received under such challenging conditions.  Too late?
  2. Still no regular relief well reports, but Admiral Allen commented yesterday that they only have about 200′ to drill.  I’m assuming the 9 7/8″ liner has been set.  If all this is accurate and there are no weather or technical delays, they should be ready to intercept the well bore soon (1-2 weeks?), even with the added time for special ranging and directional surveys.
  3. Unless the relief well is delayed, it doesn’t seem to make sense to change the LMRP cap at this time.  Collection might improve somewhat with the new cap, but the well would be wide open during the change.
  4. Day 21 since the Montara report was delivered to the Ministry, and there are no recent news updates.  No interest?
  5. Very good article in Platts as the media begins to show more interest in regulatory approaches.

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  1. Montara watch: 19 days have now elapsed since the Montara Inquiry Report was presented to Minister Ferguson, and there are no recent media updates on the release of the report. Meanwhile, Australian radio has a good piece on Montara – long, but worth the time.
  2. Macondo: The relief well reports continue to be sketchy and inconsistent.  On July 4, the Unified Command reported that the primary relief well had reached 17,400′ (presumably measured depth), while  BP’s update for the same date indicated that the first well had reached 17,725′ (this too must also be measure depth, not true vertical depth).  It’s unclear whether the final casing (9 7/8″ liner) has been set.  Admiral Allen will likely provide a better update today.
  3. More regulatory philosophy: The regulatory system is at least as important as the specific operating requirements.   This UNEP piece provides a good summary of the strengths and weaknesses of different approaches.

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-The duration of the Montara blowout was 75 Days. Ironically, Day 76 of the Macondo blowout will be the 4th of July.

-Eleven days have elapsed since the Montara Report was presented to Minister Ferguson, who has apparently retained his cabinet position in the new government.  Now that the cabinet has been settled, perhaps there will be more public clamor for the report?

-Cap Summit in DC? – According to Admiral Allen, government and industry experts will convene on Wednesday to decide whether to change the collection cap.  Other designs would provide a better seal and facilitate higher recovery rates via free-standing risers, but the well would flow unabated during the changeover.

-More Macondo irony:  Since the oil spilled is “avoidably lost,” royalties will presumably be due on both the oil spilled and the oil “produced” at Macondo.  However, for fields in water depths greater than 800m, the Deepwater Royalty Relief Act  of 1995 exempts the first 87.5 million barrels of oil equivalent from Federal royalties.  Court interpretations of this poorly written legislation have determined that this relief must be applied on a lease (not field) basis, making the royalty exemption much more generous.  Ironically, Kerr McGee (now part of Macondo partner Anadarko) filed the law suit that resulted in this favorable decision for industry.  MMS, which has been repeatedly (and incorrectly) denounced for being “too cozy with industry,” fought hard for the less generous interpretation.

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Australia dumped its Prime Minister!  See the Upstream report.

Julia Gillard is now Australia’s first female Prime Minister.  Our request to her: Please release the Montara report!

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No Love for Long Strings – The rest of the industry has distanced itself from BP’s casing program, swearing their allegiance to tiebacks.

CEO sails while “small people” suffer – The PR disaster continues for BP.

BP partner seeks annulment – The first shots in the multi-billion dollar BP-Anadarko dispute have been fired.  Look for new liability clauses in operating agreements and regulations.

Who is in charge and accountable? – Macondo, like Montara, was entirely preventable.  Know who is in charge, and make sure they are competent and cautious leaders.  As a friend told me yesterday, the best technology can be undone by human arrogance.

Just ‘Roo It! – Australia’s investigation process works great until it comes to releasing reports.  Varanus Island deja vu?

Storm watch – Another common concern for Montara and Macondo – the onset of hurricane/cyclone season.  We need about six more weeks (preferably more) until the first hurricane evacuations in the Gulf.

Sad irony – The first FPSO production in the Gulf of Mexico is at the Macondo field.

90+% recovery – Promised soon with new well cap and production systems.

Relief? – First relief well is ahead of schedule.  Has a well ever been more anticipated and needed?

Aftermath – While the chance of BP operating Macondo is virtually zero, will PTTEP be allowed to continue operating Montara?

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