Posts Tagged ‘MMS’

On January 20th, the offshore world lost a superstar when Gary Lore’s courageous battle with pancreatic cancer ended. Gary was the nation’s top expert on offshore oil and gas resources, an outstanding geologist, a natural leader, and a witty and supportive friend and colleague.

Gary grew up in Camden, NJ where he was an outstanding student and athlete at Woodrow Wilson high school. He joined the Dept. of the Interior’s offshore program after earning an M.S. in geology at Rensselaer Polytechnic Institute in 1974.  

During his 32 years with the US offshore program, Gary led resource evaluation units in the Pacific and Gulf of Mexico Regions, and was promoted to Chief of the Resource Evaluation Division at the Minerals Management Service headquarters office in Herndon, VA. A few of Gary’s many career highlights:

  • Authored numerous professional papers on US offshore oil and gas resources and exploration and evaluation models.
  • Advised congressional and cabinet officials on offshore resources and production potential.
  • Directed the use of the complex MONTE CARLO tract evaluation model and was among the few that actually understood it.
  • Participated on the prestigious US oil resources panel convened by DOE and the Univ. of Texas in 1992.
  • Contributed to many special energy assessments including Oil and Gas Technologies for the Arctic and Deepwater.
  • Led the pioneering OCS Connect “e-gov” project that automated governmental transactions with industry, improved timeliness and efficiency, and minimized redundant reporting.

Those of us who worked with him were most fortunate to have had that privilege. RIP Gary, you made a difference.

Gary with Bud and geologist-bagpiper Norm Weaver (This and the previous photo by Keith Good)
Gary and Janet at their wedding 49 years ago

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On Monday, the offshore world lost Mike Conner, an outstanding engineer and a major contributor to the success of the US offshore program.

Mike is the person most responsible for the Deepwater Operations Plan (DWOP), a pioneering safety-case approach to regulating deepwater oil and gas development. The DWOP program was initiated 30 years ago and facilitated deepwater production at a time when there were no deepwater-specific regulations or standards. Innovative tension leg platform, compliant tower, spar, production semisubmersible, and subsea projects would not have been possible without the DWOP program. 93% of Gulf of Mexico oil production and 76% of the gas is now attributable to deepwater production facilities. Thanks in large part to the DWOP program, these facilities have had a nearly flawless safety and environmental record.

While his obituary is no yet available, this link announces Mike’s well-deserved selection for the OTC Heritage Award in 2017, and provides good information on Mike and his career.

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The Safety Award for Excellence (SAFE) program was initiated in 1983 by Lowell Hammons, a senior executive in the Minerals Management Service, the OCS safety regulator at the time. The objective was “to promote interest in and recognition of operational safety and environmental protection on the OCS.” In that regard, the program was highly effective.

Companies could not self-nominate or be nominated by other companies. District winners were selected by MMS district personnel based on compliance and incident data, and inspector evaluations. The national SAFE winner was selected using data and input from all districts. Companies rightfully took great pride in the recognition, and the SAFE program helped drive the development of safety management systems and safety culture initiatives.

Attached is a list of the award winners for 1983 and 1984. Also note the recognition for the Salenergy jackup crew members who rescued injured and endangered personnel from a distressed vessel. Such heroism was not uncommon.

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An important figure in the history of the US offshore program passed away last week. Gerry Rhodes was a petroleum engineer with an attorney’s gift for understanding laws and regulations. Among other leadership roles in the offshore regulatory program, Gerry was Chief of the Minerals Management Service’s Branch of Rules, Orders, and Standards in the 1990’s.

Gerry was among the first in the Federal government to fully understand the financial responsibility risks associated with the decommissioning of offshore facilities and the urgent need to update requirements for the plugging of wells and removal of platforms. The enormity of this challenge is described in the 1991 Forbes article pasted below. Despite sharp divisions within the offshore industry and the resulting political pressure, Gerry succeeded in finalizing regulations (including this 1995 rule) that are the basis for the current financial responsibility programs in BOEM and BSEE. Without Gerry’s resolve, subsequent financial assurance challenges and government outlays would have been far greater.

RIP Gerry. You were a true gentleman, a dedicated father and grandfather, and a diligent and highly accomplished colleague.

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My involvement with Ohmsett dates back to the 1970s when EPA operated the facility and I was on the Ohmsett Interagency Technical Committee. The facility fell into disrepair in the late 1980s. Thanks largely to the vision and initiative of my Minerals Management Service (MMS) colleague Ed Tennyson and the enactment of the Oil Pollution Act of 1990, the MMS began restoring the facility in 1990 and resumed testing activities in 1992. Senator Frank Lautenberg (NJ) and a host of dignitaries participated in the grand reopening event.

The facility has lived up to the hype and the current BSEE leadership team seems committed to continuing the testing and innovation. For more information about testing at Ohmsett, including renewable energy concepts, check their website. For an excellent summary of Ohmsett activities from 1992-97, see this paper.

Among the many companies to test equipment at Ohmsett is one that was partially owned by actor Kevin Costner. See the article and photo below. If you build it (and maintain it), they will come!

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….for continuing to recognize the Conservation Division of the Geological Survey (USGS) as the US offshore safety regulator, even though 40 years have passed since that was the case and there have been 3 successor bureaus. 😀

33 CFR § 140.4 Relationship to other law. (current text excerpted from Coast Guard Subchapter N regulations)

(a) Design and equipment requirements of this subchapter for OCS facilities, including mobile offshore drilling units in contact with the seabed of the OCS for exploration or exploitation of subsea resources, are in addition to the regulations and orders of the U.S. Geological Survey applicable to those facilities.

USGS North Atlantic District, Hyannis, MA, Halloween 1980

Most of us old-timers think the best regulatory framework for the offshore program was in the USGS days (pre-1982). Some of this may be nostalgia, but there are some good reasons for this thinking:

  • USGS was/is an internationally acclaimed scientific organization that was always headed by a renowned geologist. The regulatory program was thus somewhat insulated from political pressures. Vince McKelvey, Bill Menard, and Dallas Peck were the Directors when I worked for USGS. Their credentials are linked. Bill and Dallas visited our Hyannis office (not at Halloween 😀) and were very supportive.
  • The Conservation Division was responsible for onshore operations on Federal lands as well as offshore activity. This facilitated information sharing and offered diverse career opportunities. My first bosses in New Orleans had worked previously in the Farmington and Roswell, NM offices.
  • We had excellent synergy with the other USGS divisions. The Marine Science Center in Woods Hole was an incredible resource for our Hyannis office. The Woods Hole office, particularly Mike Bothner and Brad Butman, had a critical role in the Georges Bank Monitoring Program, the best ever (in my biased opinion) environmental study of exploratory drilling operations in a frontier area.
  • The USGS Conservation Division had a very small and supportive headquarter’s staff, which minimized the potential for conflict with field offices.
  • Prior to the formation of the Minerals Management Service (MMS) in 1982, the Bureau of Land Management was responsible for leasing, but all regulatory functions were under USGS. This included resource evaluation/conservation, plan review and approval, permitting, inspections and enforcement, and investigations. The division of MMS responsibilities, most notably the assignment of plan approval to the leasing bureau (BOEM) rather than the regulatory bureau (BSEE), complicates the work of both bureaus and is a prescription for inefficiency, confusion, overlap, and conflict.

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Industry standards are critical to safety achievement. They represent best practices as determined by leading experts in the many disciplines that support oil and gas exploration and development. Another plus for standards is that, unlike regulations, they can be developed in a timely manner, particularly where there is an immediate need. However, industry mergers and streamlining have reduced the diversity of input, and some companies either do not participate or participate primarily to promote or protect their particular interest. The need for a consensus can also result in “lowest common denominator” outcomes that lack the necessary rigor.

Minerals Management Service (MMS) reviews indicated that cementing issues were the leading contributing factor to well control incidents between 1992 and 1996 (see chart below). On August 16, 2000, MMS challenged a new API cementing work group to improve zonal isolation, reduce the occurrence of sustained casing pressure, and prevent annular flow incidents before, during, and after cementing operations. Unfortunately, the standard was long delayed because of internal disagreements within the work group. Feedback indicated that some participants preferred a watered down, less rigorous version.

It is undisputed that the primary cement at Macondo failed to isolate hydrocarbons in the formation from the wellbore—that is, it did not accomplish zonal isolation. If the cement had set properly in its intended location, the cement would have prevented hydrocarbons from flowing out of the formation and into the well. The cement would have been a stand-alone barrier that would have prevented a blowout even in the absence of any other barriers (such as closed blowout preventer rams, drilling mud, and cement plugs).

Chief Counsel’s Report, National Commission on the BP Deepwater Horizon Oil Spill

API Standard 65-2, Isolating Potential Flow Zones During Well Construction, if completed in a timely manner and complied with would likely have prevented not only the Macondo disaster, but also the 2009 Montara blowout in Australia. (The Montara investigation hearings were covered extensively on this blog in 2010.) This important standard was ultimately finalized in a reactive manner after the Macondo well blew out.

Standard 65-2 focuses on the prevention of flow through or past barriers that are installed during well construction. A few key elements that are pertinent from a Macondo perspective:

  • Companies are required to perform a risk assessment prior to utilizing foamed cement and make sure that the results of this assessment are incorporated in the cementing plan. In setting the production casing on the Macondo well, foamed cement was used in an oil-based mud environment, destablizing the cement and contributing to the failure to isolate the highly productive oil reservoir.
  • The standard specifies float valve and cement requirements for the shoe track at the base of the casing, the Macondo failure point. (Weatherford float equipment failures were a common element to both the Montara and Macondo blowouts. Weatherford’s $75 million settlement with BP seems rather modest when one considers the magnitude of the damage costs.)
  • The framework in Annex D of the standard does a good job of outlining the questions that should be asked in conducting a cementing risk assessment. These issues identified in the Chief Counsel’s report, which includes an outstanding review of the technical and management issues associated with the cementing/zonal isolation of the Macondo reservoirs, should have been addressed by BP and their contractors before initiating the well suspension program:
    • narrow pore pressure/fracture gradient;
    • use of nitrogen foamed cement;
    • use of long string casing design;
    • short shoe track;
    • limited number of centralizers;
    • uncertainty regarding float conversion;
    • limited pre-cementing mud circulation;
    • decision not to spot heavy mud in rathole;
    • low cement volume;
    • low cement flow rate;
    • no cement evaluation log before temporary abandonment; and
    • temporary abandonment procedures that would severely underbalance the well and place greater stress than normal on the cement job.

Unfortunately, such an assessment was not conducted and critical operational decisions were made in a rash manner with the objective of saving time. We know the outcome – 11 lives lost, massive pollution, and enormous social costs

Despite making multiple changes over the last nine days before the blowout, the Macondo team did not formally analyze the risks that its temporary abandonment procedures created. The Macondo team never asked BP experts such as subsea wells team leader Merrick Kelley about the wisdom of setting a surface cement plug 3,000 feet below the mudline to accommodate setting the lockdown sleeve or displacing 8,300 feet of mud with seawater without first installing additional physical barriers. It never provided rig personnel a list of potential risks associated with the plan or instructions for mitigating those risks.

Almost every decision the Chief Counsel’s team identified as having potentially contributed to the blowout occurred during the execution phase.

Chief Counsel’s Report


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US Offshore Program:

Prior to April 20, 2010, 25,000 wells had been drilled in US Federal waters over the previous 25 years without a single well control fatality, an offshore safety record that was unprecedented in the U.S. and internationally. Well control was the keystone of every operator and drilling contractor’s safety program and the Minerals Management Service regulatory program, which included a pioneering well control research facility at LSU, standards, prescriptive rules, and comprehensive training requirements.

The future of the offshore program was bright. The Obama administration had included an Atlantic OCS lease sale in the 5-year OCS Oil and Gas Leasing Program for 2010-2015. This would have been the first Atlantic sale since 1983. I participated in a hearing held by a Florida Senate committee that was seriously considering oil and gas leasing in Florida State waters. Even in California, there was some support, led by a group known as Stop Oil Seeps, for new offshore exploration and production .

Everything changed on April 20, 2010, when BP’s Macondo well blew out. Eleven workers lost their lives, the most in a single US offshore incident since 1968, when 11 died in a fire and explosion at West Delta Block 23. In the history of the US offshore program, only a 1964 gas blowout (Eugene Island Block 273) caused more fatalities (22). (There were also tragic helicopter crashes in 1977 and 1984 at South Marsh Island Block 128 and Eugene Island Block 190 that killed 17 and 14 offshore workers respectively.) The Macondo blowout was more than a safety disaster, it was also a pollution spectacular that dominated the news for the next 3 months.

Pre-Macondo BP:

As is often the case with large organizations, the BP story is complex. BP said all the right things about safety and environmental protection, and seemed to mean them and practice them. They had comprehensive safety and risk management programs. They were at the vanguard in promoting personal safety among employees including the now common (and sometimes a bit contrived) practice of opening meetings with safety messages. All of that was no doubt consistent with their “beyond petroleum” rebranding (2002). However, the corporate image was badly tarnished by the 2005 Texas City refinery explosion that killed 15 workers and a 5000 barrel pipeline spill on the North Slope of Alaska in 2006.

BP’s deepwater Gulf of Mexico exploration programs had been very successful. BP produced more oil in the 2 years prior to the blowout than any other US offshore operator – 117 million barrels in 2008 and 188 million barrels in 2009. Their 2009 oil production total is still the highest in history for any US offshore operator (something I hadn’t realized until I checked the figures for this post.)

The compliance record for BP’s production facilities in 2008 and 2009 was “beyond” excellent. While BSEE does not publish the details needed to distinguish INCs by facility and operation, my recollection is that inspection of the thousands of components on their production platforms did not result in even a single incident of non-compliance (INC) in 2008, and there were no production safety or pollution incidents. BP was named a finalist for the MMS SAFE Award to be presented at OTC in May, 2009. However, pointing further to their corporate inconsistencies, BP’s drilling compliance record was not as good, and qualitative feedback from MMS inspection personnel indicated some safety and compliance issues. This input may have been a hint at the drilling program management issues that surfaced after the blowout. In light of these concerns about BP’s drilling operations, Devon Energy was presented the National SAFE Award in the “High Activity Operator” category.

I retired from MMS on 1/2/2010 and was thus not involved in the deliberations for the 2009 SAFE Awards. I understand that BP was the leading candidate to be presented the award in May 2010. However, the way the program worked was that finalists in each category were named in advance, but the winners were not announced until the awards luncheon. The reasons for this approach were to build suspense and avoid a situation where the winning company was involved in a significant incident prior to the presentation. This had never been an issue in the 30 year history of this awards program.

In light of the tragic events of April 20, the 2010 SAFE awards luncheon was cancelled, as it most definitely should have been. That said, I remain a strong believer in recognizing safety achievement. The MMS SAFE Awards were the only offshore safety awards determined by the safety regulator based on incident and compliance data and input from inspectors, the people who are most familiar with each company’s operations and the effectiveness of their safety programs. The awards program drew attention to best practices, information sharing, and safety leadership. The recipients and all staff that contributed to the company’s success were rightfully proud of their achievement. You could not nominate yourself or be nominated for SAFE awards; only the companies with the best safety and compliance records were considered. Past performance is never a guarantee of future success, but MMS SAFE Award winners earned the recognition they received and continued to be top performers.

Tomorrow: Macondo revisited, Part 3: The delayed cementing standard

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MMS, the National Institute of Standards and Technology, and Environment Canada were leaders in developing and testing in situ burn spill response capabilities in the 1990’s. Tests at the MMS (now BSEE) Ohmsett facility and at sea offshore Newfoundland demonstrated this important spill response option.

BSEE has continued to advance the MMS spill response research program, and recently announced an exciting enhancement to in situ burn capabilities. BSEE and the Naval Research Laboratory invented a low-emissions atomizer burner designed to cleanly and quickly burn spilled oil, even after oil has been emulsified with water. See the video below.

The atomizer works by converting a stream of liquid, in this case, neat or emulsified crude oil, into a fine spray. The combustible spray is then able to completely burn without the plume of black smoke or residue, leaving the area safer for people, wildlife, and the environment. The burner interfaces with off-the-shelf pumps and air compressor equipment, so the collected fuel can be pumped to the burner. It can be mounted on a floating platform to stand freely in the water and has been successfully tested on waves.


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Charles Smith

I’m very sad to report the passing of a leading offshore safety researcher and long-time colleague, Dr. Charles Smith. Charles was a pioneering structural engineer who joined the US Geological Survey’s Conservation Division (then the offshore safety regulator) in ~1977 to establish the Technology Assessment and Research (TAR) Program.  With the thinnest of budgets, Charles formed partnerships that addressed the gamut of offshore safety issues. Some of his accomplishments:

  • Working with the Offshore Technology Research Center (Texas A&M) and others, Charles sponsored projects that led to the successful investigation of deepwater production concepts including TLPs, Spars, FPSOs, and semisubmersibles.  These designs are now the mainstays of deepwater development worldwide.
  • Organized well control projects that included the establishment of the deepwater well control research facility at Louisiana State University. 
  • Established the first ever offshore earthquake measurement network in the Pacific Region. The measurement system at Platform Grace in the Santa Barbara Channel successfully recorded 5 earthquakes and the structural responses at multiple locations on the platform.
  • Conducted research that led to new hurricane design standards for offshore structures and topsides equipment.
  • Working with colleagues at Berkeley and Stanford, conducted groundbreaking research on human and organizational factors affecting offshore safety. This was the basis for important safety culture studies that followed.
  • Studied pipeline risks and corrosion management for structures and pipelines.
  • Studied decommissioning options and their comparative environmental effects. 
  • Assessed arctic development options including gravel and ice islands and monopod concepts.
  • Conducted structural reviews leading to the renovation of the Ohmsett spill response test facility.
  • Participated on organizing committees for the International Conference on Ocean, Offshore, and Arctic Engineering (OMAE).
  • Along with representatives from Norway, the UK, Brazil. Canada, Mexico, Australia, and New Zealand, founded the International Committee on Regulatory Authority Research and Development (ICRARD).

Charles was the only offshore regulatory engineer to be selected as one of 10 finalists for the prestigious NSPE Federal Engineer of the Year award. (Keep in mind that the US government employs more than 130,000 engineers.) In 2009, the year of his retirement from Minerals Management Service, he was inducted into the Offshore Energy Center’s Hall of Fame (Galveston, TX) as as a Technology Pioneer for Health, Safety, and the Environment.   

After retirement Charles moved to Newfoundland and continued working on offshore safety issues with Memorial University, Canadian regulators, and industry representatives.  He and his wife Elaine built a lovely home overlooking the water in Bay Roberts. He was proud to be a citizen of both the US and Canada, and both countries were beneficiaries of his long and enormously successful career. Here is his obituary.

Charles and his wife Elaine with my wife and me and John Gregory and his wife at the Offshore Energy Center Hall of Fame induction gala (Houston, 2009). Bud

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