Tuesday, June 29, 2010

Seven Sins

The Hayride has an excellent summary of how the US government has shown its incompetence with respect to the BP oil spill. I'll summarize them here but it is really worth the read.

The Jones Act - The Obama administration has used the Jones Act as an excuse for not using foreign flag vessels to aid with the cleanup. The fact is that the Jones Act does not apply outside of 6 miles offshore and he could easily waive the act, like Bush did for Katrina.

The Packgen Blowoff - A manufacturer in Maine decided to start building oil boom on speculation knowing that there would be a demand for it. The government has ignored the 15 miles of boom they have stored in their warehouse even as Bobby Jindal was pleading for more boom.

Skimmers Staying Put - 2000 skimmers are available in the US but only 400 are actually being used to fight the spill. NBC news had film of workers using shop vacs to try to suck up oil in the marsh. Maybe Home Depot should be running the cleanup.

The Vacuum Barge Affair - When Louisiana decided to rig up some vacuum trucks on barges and use them to suck up oil, the USCG pulled them all back into port until they bought more fire extinguishers and life vests.

Sand Berms - The permitting process slowed the construction of berms designed to keep oil out of the most sensitive marshes. When dredging was finally allowed to proceed, a single individual stopped it again because of where the dredge material was taken from. Almost a week was lost to relocate the dredge suction.

Lack of Fire Boom - Burning has always been a key part of the federal response plan to a major oil spill, but when fireproof oil boom was needed, there was none available.

15 ppm - The EPA requires that water discharged overboard have no more than 15 parts per million of oil and grease. The Dutch oil spill vessels can suck up a tremendous amount of oil and water. They then separate the oil from the water and pump the water overboard. The problem is that the oil content of the discharge water is more than 15 ppm. Hence, the system was not approved by the EPA. Am I the only one who sees the irony in this decision? Why hasn't the president waived this requirement by executive order?

I'd like to add the fiasco concerning dispersants to this list. After the USCG approved the use of dispersants, the EPA called for a halt to their use until toxicity issues were resolved. They were basically ignored and the use of dispersants continued. The dispersants being used have been around for years. It makes one wonder why their toxic effects have not been studied.

When you take all of these issues together, you begin to wonder if the government is just that incompetent or if there is a conspiracy to NOT clean up the oil spill for nefarious political purposes.

Tuesday, June 15, 2010

Engineer Speak

Something to break the oil spill angst.

Sunday, June 13, 2010


Dalwhinnie is a highland scotch. The distillery was founded in 1897. The name Dalwhinnie means "Meeting Place". The site of the distillery was a meeting place of cattle drive routes through the mountains. It has the distinction of being the highest distillery.

Color: light amber
Nose: clean
Palate: smooth
Body: silky, light texture
Finish: warming

Dalwhinnie is a smooth scotch. It is an excellent scotch to begin ones exploration of spirits as it will not abuse the taste buds.

Tuesday, June 8, 2010

Drilling Moratorium - An Economic Nightmare

The Louisiana Mid-Continent Oil and Gas Association has prepared a summary of the impact of the 6 month drilling moratorium to the State of Louisiana. I have condensed their summary here.

Since the announcement by the MMS, the GOM rig count has decreased to 23 rigs from 46 last week.

Roughly 33% of nation’s domestically produced oil and 10% of the nation's natural gas comes from the Gulf of Mexico. In addition, 80% of the Gulf’s oil, and 45% of its natural gas comes from operations in more than 1000 feet of water – the deepwater (2009 data).

Note that the moratorium applies to all wells in water depths greater than 500'. Therefore, it will apply to wells that are not typically considered to be deep water wells.

The moratorium means roughly 33 floating drilling rigs – typically leased for hundreds of thousands of dollars per day – will be idled for six months or longer. In all probability, these rigs will find work outside of the US and will not be available for domestic drilling at the end of the moratorium.

Each drilling rig employs 180 to 280 people working in rotating shifts. In addition, each drilling job supports 4 other jobs. Therefore, 800 to 1400 jobs per idle rig are at risk. That's a loss of 25,400 to 46,200 jobs!

Wages for those jobs average $1,804/weekly. The potential for lost wages is huge, over $5 to $10 million for 1 month – per rig! Wages lost could be over $165 to $330 million/month for all 33 rigs.

The number of wells and oil companies impacted are:

Shell (7)
Chevron (4)
Anadarko (3)
Marathon (2)
Noble Energy (2)
Eni US Operating Co. (2)
ATP Oil & Gas (2)
Statoil (2)
ExxonMobil (1)
Petrobras America (1)
BHP (1)
BP (1)
Kerr McGee (1)
Murphy (1)
LLOG (1)
Newfield (1)
Hess (1)

The number of successful wells drilled is the leading indicator of economic demand for the offshore industry. A successful well will trigger the start of engineering studies to determine the best type of structure for development of the field. This will lead to fabrication and installation of the massive structures required to produce oil and gas in deep water. These are high technology, high skills and high paying jobs. The drilling moratorium will drive a stake into the heart of the domestic offshore industry.

Sunday, June 6, 2010

BP Update - More FAIL

It's Sunday, June 6, Day 48 since the blowout.

BP has set the revised tophat on the well after failing to cut the riser with the wire saw. They had to revert to the shear which left a jagged cut which they could not seal with the original LMRP cap. The tophat is on the well but video shows most of the oil flowing out of the bottom of the cap. This was predictable. The well bore is 20" in diameter and they wanted to force all that oil through 6-5/8" drill pipe which has an internal diameter of 3-1/2". Overall, I think they took a step backwards. They increased flow from the well but are not capturing more oil with the cap.

Tar balls are washing up in P'cola. Destin is next.

In other news, James Carville saw Thad Allen and Tony Hayward having dinner together the other night in the French Quarter. Tony has a lot of courage to eat at a public restaurant in New Orleans. I can only guess at the "extras" that the wait staff added to his meal.