Archive for June 2010

At what point should you swallow your pride?

16th June 2010 by Crew

Skimming vessels, 70 miles off the coast of Alabama, US GoM © BP plc

The Obama Administration has come under heavy criticism for potentially delaying clean up operations of the Deepwater Horizon oil spill by not issuing a blanket waiver to the protectionist Jones Act which would have allowed foreign companies, possessing some of the world’s most advanced oil skimming ships, to assist.

Other presidents have waived the act under similar circumstances (e.g. Bush following Hurricane Katrina) so there is some confusion as to why Obama has not followed suit.

The Coast Guard and the Administration are quick to point out that some foreign technology is being used in the current cleanup effort; however, the reality is that this is largely technology transferred to US vessels.

A US-based company is now cleaning oil off surface water in the Gulf of Mexico using rigid sweeping arms provided by Dutch company, Royal Boskalis and the Dutch Ministry of Transport, Public Works and Water Management. Instead of using the Dutch ships and crews immediately, when help was offered back in April, the operation was delayed until U.S. crews could be trained.

Similarly, according to Belgian dredging giant Jan de Nul, an offer to send its fallpipe vessel Simon Stevin to the Gulf of Mexico was turned down because of the protectionist US law. The 36,000 dwt Simon Stevin is equipped with a 2,000 m fallpipe, which is much broader that the funnel BP is currently using and could have been used to suck up oil from the broken riser.

The Dutch also offered assistance with building sand berms (barriers) along the coast of Louisiana back in April, but that offer was also rejected. Finally, it appears the President may be softening with the announcement of the contract award to Royal Boskalis Westminster N.V. to deliver sand for berms to protect the Louisiana coast from the Deepwater Horizon oil spill. However, Boskalis will be using the trailing suction hopper dredger Stuyvesant, which already sails under the American flag.

After opening new offshore areas for exploratory drilling earlier this year and then retracting this in the wake of the Deepwater Horizon incident, perhaps the President doesn’t wish to appear to be backtracking again after firmly voicing his support over the reauthorisation of the Jones Act.

President Obama has made it clear that he intends to hold BP accountable for the incident (Note: for those people translating this into anti-British sentiment, BP shares are actually 40% British owned and 39% US owned, so it’s nearly as American as it is British). However, he will need to remember that he will also be held accountable for what he did and didn’t do in the wake of this tragedy. Pride comes before a fall as they say.

BP bring out the Top Hat

4th June 2010 by Crew
Mac on... the BP oil spill (source www.dailymail.co.uk/MAC)
‘Marjorie, dear. How would you like to play a big part in stopping an environmental disaster?’

After the Top Kill procedure failed it appears BP may have finally managed to place a cap over the damaged wellhead.

BP had originally intended to install a lower marine riser package (LMRP) cap containment system; however abandoned the procedure after two days of unsuccessfully trying to create a clean precision cut to separate the damaged riser at the top of the Deepwater Horizon’s blow-out preventer so the LMRP cap could be fitted.

BP have now installed a “top hat” (a smaller version of the containment dome they initially tried) but it has yet to be determined how successful this latest attempt has been. Meanwhile, preparations are ongoing for the deployment of the lower marine riser package (LMRP) cap containment system.

Even if either or both methods are successful, they are only a temporary and partial fix. BP does not expect to completely halt the escape of oil until August, when it hopes to have completed two relief wells. Work on the first relief well, which started on May 2, continues and has currently reached a depth of 12,090 feet. Work on the second relief well, which started on May 16, had reached a depth of 8,576 feet before drilling was temporarily suspended on May 26. Drilling operations on the second relief well resumed on May 30.

Meanwhile, vessel owners are concerned over the impact the drilling memorandum imposed in the US Gulf will have not only on future charters but existing commitments. Hornbeck Offshore currently has nine vessels on term deals in the Gulf of Mexico. In a statement to investors, Hornbeck declared: “To the extent that any customer should assert force majeure for either the oil spill or the moratorium, the company intends to defend the enforcement of its contracts against such claims.” Certainly a firm stance from Hornbeck, and one no doubt they wouldn’t have taken without seeking legal counsel first. Five of the company’s ships are currently employed by BP to fight the Deepwater Horizon oil spill.

No doubt, those owners with vessels capable of working outside of the US Gulf will be looking to find work in other regions in a bid to mitigate their exposure to the increasing near-term uncertainty in their home market.