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Exxon "Says '$25B Rule' Will Sink Deepwater Oil Drilling" and reduce safety.

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  • Exxon "Says '$25B Rule' Will Sink Deepwater Oil Drilling" and reduce safety.

    The unlawful regulatory assault continues...
    Exxon Says '$25B Rule' Will Sink Deepwater Oil Drilling

    by Bloomberg|Joe Carroll|Thursday, April 14, 2016

    (Bloomberg) -- The world’s biggest oil explorers are fighting a U.S. plan to toughen offshore drilling rules that Exxon Mobil Corp. said will cost $25 billion over 10 years and render many offshore discoveries worthless.

    [...]

    The changes would arrive amid the worst oil slump in a generation. ConocoPhillips and Chevron Corp. have already abandoned some Gulf prospects because they wouldn’t be profitable at current prices. If the proposals are enacted, exploration outlays in the Gulf will tumble by 70 percent over the next two decades, wiping out as many as 190,000 jobs, according to consulting firm Wood Mackenzie Ltd.

    [...]

    Government Shortcomings

    In a closed-door meeting last month, BP, the largest driller in the U.S., said the government underestimated the time and complexity needed to implement the rules, ignored the reduced production and stranded reserves that would result, and added unneeded operations that could boost risks rather than decrease them. The comments came in slides Exxon presented at the meeting and were posted on a government website.

    The Deepwater Horizon disaster looms large over federal attempts to tighten requirements. The blowout at the $153 million well sank a $365 million drillship, paralyzed the Gulf region for months and cost BP more than $40 billion in penalties, compensation and restoration costs.

    Exxon, in the closed-door meeting with White House and Interior Department officials on March 7, outlined its assertion that the rules will cost $25 billion and argued they would increase the danger of a blowout by wresting decision-making from on-site engineers with decades of experience.

    Increasing Risk

    Some rock formations can’t handle the heft of drilling fluids that would be required, while the proposal for pouring cement around the steel pipe lining a well would boost the risk of dangerous air pockets and cracks, according to slides Exxon presented at the meeting.

    [...]

    More Dire

    Exxon’s $25 billion warning isn’t even the most dire forecast out there. An analysis conducted by consulting firms Quest Offshore and Blade Energy Partners on behalf of the industry-funded American Petroleum Institute estimated extra costs over 10 years at $31.8 billion and result in the the loss of the equivalent of 500,000 barrels of crude a day by 2030.

    Crude output from the U.S sector of the Gulf will reach a record 1.91 million barrels a day by the end of next year as discoveries dating as far back as 2005 come online after years of design, drilling and construction work, the Energy Information Administration said last month.

    In the March 7 meeting, Exxon cited an industry review of 175 Gulf wells drilled since 2010 that concluded 63 percent couldn’t be drilled as designed if the new rules had been in place.

    [...]

    - See more at: http://www.rigzone.com/news/oil_gas/....8bu3YGzD.dpuf



    The regulation is unlawful because it is clearly designed to prevent the drilling of wells. The express intent of the law establishing the regulatory agencie was to ensure that Federal mineral resources were safely developed and the government received fair value in leasing the mineral rights.
    Last edited by The Doctor; 14 Apr 16, 09:41.
    Watts Up With That? | The world's most viewed site on global warming and climate change.

  • #2
    Personally, I'm all out of sympathy for Big Oil and tired of their constant whining that they "just can't make it" like the rest of us have to.

    Suck it up or find another line of work.
    Quis Custodiet Ipsos Custodes? Who is watching the watchers?

    Comment


    • #3
      Exxon on says rotfl
      "Ask not what your country can do for you"

      Left wing, Right Wing same bird that they are killing.

      you’re entitled to your own opinion but not your own facts.

      Comment


      • #4
        Originally posted by Half Pint John View Post
        Exxon on says rotfl
        I would prefer to hear from experts rather than government officials who usually have proven they can't tell their @$$ from their elbow, particularly the EPA (Environmental Prophet's Advocates).

        Comment


        • #5
          Exxon is interested in profits, nothing else. Do they give a rats ___ about what ever damage they leave behind? Of course they do. Because some group is going to come along and sue the ___ out of them, maybe.
          "Ask not what your country can do for you"

          Left wing, Right Wing same bird that they are killing.

          you’re entitled to your own opinion but not your own facts.

          Comment


          • #6
            Dems the breaks!

            Comment


            • #7
              Originally posted by Half Pint John View Post
              Exxon is interested in profits, nothing else. Do they give a rats ___ about what ever damage they leave behind? Of course they do. Because some group is going to come along and sue the ___ out of them, maybe.
              Unlike the EPA who has an agenda, no need for profits, and when they screw up no means of accountability...

              Comment


              • #8
                Originally posted by T. A. Gardner View Post
                Unlike the EPA who has an agenda, no need for profits, and when they screw up no means of accountability...
                All of which apply to everything related to the federal government. Just another reason for the dismantling of the entire state, really.

                Comment


                • #9
                  Originally posted by Daemon of Decay View Post
                  All of which apply to everything related to the federal government. Just another reason for the dismantling of the entire state, really.
                  The problem with the libertarian utopia is that intelligent, wise, common sense regulation is necessary.

                  In the aftermath of Macondo, the MMS (now BOEM/BSEE) and industry quickly reacted to the mistakes that were made by BP, Transocean and the other contractors. New reg's and an industry-wide re-dedication to safety drastically reduced the probability of another Macondo (which was already highly improbable). However, this maladministration has used Macondo as an excuse to try to shut down operations on the OCS through regulatory malfeasance.

                  The excuse for this new rule is this nonsense...
                  “It is abundantly clear that despite post-Macondo improvements in safety and technological advancements, there are still issues that must be addressed,” Brian Salerno, director of the Bureau of Safety and Environmental Enforcement, said in December testimony before the Senate Energy and Natural Resources Committee. In 2013 and 2014, drillers in the Gulf lost control of eight and seven wells, respectively, according to Salerno. One incident resulted in a blowout “that caused a massive explosion and fire on the rig,” he told the senators.

                  - See more at: http://www.rigzone.com/news/oil_gas/....cXjKvUD3.dpuf

                  Well control incidents are rare; but they will always happen as long as wells are being drilled. BSEE is essentially imposing the precautionary principle on the industry. The “massive explosion and fire on the rig” didn't kill anyone or cause a spill. It did result in the loss of the drilling rig and cost the rig owner and well operator a lot of money.

                  People make mistakes. It is impossible to regulate away human error.
                  Watts Up With That? | The world's most viewed site on global warming and climate change.

                  Comment


                  • #10
                    Quis Custodiet Ipsos Custodes? Who is watching the watchers?

                    Comment


                    • #11
                      IF,IF it was only on error.
                      "Ask not what your country can do for you"

                      Left wing, Right Wing same bird that they are killing.

                      you’re entitled to your own opinion but not your own facts.

                      Comment


                      • #12
                        Originally posted by T. A. Gardner View Post
                        Unlike the EPA who has an agenda, no need for profits, and when they screw up no means of accountability...

                        That mess didn't come from the EPA. That they totally fk the clean up is another subject. That mess should never have been there in the first place. Mining company makes profits without the need for clean up and the taxpayer gets to pay for the clean up.

                        Do I really need to tell that of course the EPA has an agenda? That is stated in the name, is it not EPA?
                        Last edited by Half Pint John; 15 Apr 16, 13:36.
                        "Ask not what your country can do for you"

                        Left wing, Right Wing same bird that they are killing.

                        you’re entitled to your own opinion but not your own facts.

                        Comment


                        • #13
                          Originally posted by Half Pint John View Post
                          IF,IF it was only on error.
                          There's no "if" involved...
                          BSEE Investigation Report

                          According to the report, the initial cause of the incited was the miscalculation of drilling fluid density by the drill crew.

                          The report said that by mixing the zinc bromide completion fluid incorrectly, the crew had not made a fluid capable of handling the full range of different pressures that were encountered in the reservoir.

                          This created a negative imbalance in the column, causing an influx of gas into the well known as a kick.

                          However, the report went on to describe how the drill crew had not noticed the kick had occurred and continued.

                          The resulting situation allowed natural gas to push up though the well eventually escaping at the rig floor.

                          The report stated that drill crew had only realized there was a problem when completion fluid began to ‘shoot’ out from the open annulus and drill pipe.


                          http://www.offshorepost.com/offshore...ophic-blowout/

                          Accidents are far more expensive than safety. However, people become complacent, even in dangerous places like drilling rigs.
                          Watts Up With That? | The world's most viewed site on global warming and climate change.

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