Drilling for oil in hostile waters

13th October 2011


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John Barwise asks whether drilling for oil and gas in progressively hostile environments can ever be safe

On the same day that the Oil Spill Prevention and Response Advisory Group (OSPRAG) launched its new emergency spill response equipment, the worst oil spill in over a decade was unfolding in the North Sea. It took Shell several days to deal with the incident at the Gannet Alpha platform and a lot longer to stop the leak altogether – so much for an emergency response.

Emergency response usually means rapid action that will prevent a problem turning into a disaster. Fire engines, A&E units and police patrols can get to an incident in minutes and the crisis is over in a matter of hours. This does not happen with oil spills, especially those 100 miles or more out to sea.

Workers and regulators can only watch and wait, sometimes for days or even weeks, for emergency response teams to bring oil spills under control. Meanwhile, precious oil resources are being wasted and hazardous pollutants are flowing out across the ocean floor and endangering marine life.

Leaking pipes

Shell’s Gannet Alpha emergency response team took three days just to secure the flowline to the sea bed with concrete mats, and much longer to close the relief valve and stop the leak. An estimated 200 tonnes, more than 1,300 barrels of oil, leaked into the North Sea, covering an area of about four square miles.

A permanent fix was expected to take several more weeks once the remaining mixture of gas, oil and water was evacuated from the leaking pipe.

DECC deemed the incident “significant”, but Hugh Shaw, the secretary of state’s representative for maritime salvage and intervention, who was appointed to oversee the operation, did offer some reassurances: “Based on the latest intelligence that I have, my view is that the oil leak is under control and has now been greatly reduced as validated by remotely operated vehicle footage and … aerial surveillance flights.”

The company assigned an investigation team to establish the cause of the accident and set up a monitoring regime to assess the impact of the spill on the marine environment.

To put this incident into context, the oil spill at Shell’s Gannet Alpha platform was not a disaster. Most of the oil was allowed to disperse naturally without chemical dispersant sprays, which actually helped to limit the environmental impact.

This was the worst North Sea incident in 10 years precisely because there have been so few major incidents over the past decade. There were no casualties, no catastrophic equipment failure and, although it took days to control the leak, the damage to marine life was relatively small.

But accidents still happen, sometimes with devastating consequences. In April last year, an explosion ripped through BP’s Deepwater Horizon drilling rig in the Gulf of Mexico, killing 11 men and triggering one of the worst marine oil spills in the history of the petroleum industry.

More than four million barrels of oil poured into the Gulf of Mexico over the next three months, decimating marine life and coastal wetlands. The pollution spread over 600 miles, from Louisiana to Florida, and by July 2010 all five states on the Gulf coast were badly affected.

Regulated industry

Deepwater Horizon, as the name suggests, was a deepwater platform, with high-tech, state-of-the-art drilling facilities, capable of reaching record-breaking depths of over 10km. Two days after the explosion, the platform and all its sophisticated monitoring equipment worth more than $500 million sank, leaving oil gushing from ruptured pipes at a rate of 5,000 barrels a day. Even with the world’s most experienced response teams and back-up support, it took nearly three months to cap the leaking well.

It was an environmental catastrophe. More than 15,000 species live in this rich ecological habitat including turtles, pelicans, herons, dolphins, tuna, crabs, oysters and shrimps. Within weeks, many were washed up dead on the shoreline. Wetlands and coastal reserves will take years to recover. Much of the Gulf was declared a fishery disaster zone and the seafood industry, worth more than $2 billion, was brought to the brink of collapse. US energy adviser Carol Browner described the spill as probably the biggest environmental disaster the country had ever faced. Following the accident, a six-month moratorium was imposed on all drilling operations in the area.

The offshore oil and gas industry is one of the most heavily regulated industries in the world and subject to a wide range of international declarations, protocols, action plans and conventions, such as the global programme of action for the protection of the marine environment from land-based activities and the international convention relating to intervention on the high seas in cases of oil pollution casualties.

In the UK, DECC is responsible for licensing, exploration and environmental regulation of oil and gas developments on the UK continental shelf (UKCS), including the issue of consents and permits, inspection, investigation and enforcement.

Following the Deepwater Horizon disaster, DECC ordered a thorough review of drilling rigs and compliance procedures in the UK. The review concluded that UK operations were good and among the most robust in the world. That was before the Gannet Alpha spill. Energy secretary Chris Huhne said at the time that he wanted to reassure the public that further exploration in deeper UK waters would be safe.

“It’s clear that our safety and environmental regulatory regime is fit for purpose … But the Deepwater Horizon disaster gives us pause for thought and, given the beginning of exploration in deeper waters west of Shetland, there is every reason to increase our vigilance,” he said.

The formation of OSPRAG was one of the outcomes of the review. Other actions under way include plans to double the number of annual environment inspections of drilling rigs and a review of indemnity and insurance requirements for operating in the UKCS, which gives some indication of the inherent risks in offshore drilling, especially in deeper water.

Hostile environments

There’s good reason to take the risks seriously. Since the 1960s, more than 100 countries have reported major oil spills in their waters, mainly from drilling rigs and tanker accidents. More than six million tonnes of valuable oil is leaking into the world’s oceans every year. In recent years, over 75 major incidents involving spills of more than 34 tonnes have been reported in the North Sea. Health and Safety Executive documents obtained by the Guardian suggest this may be an underestimate, however, and that more than 100 potentially lethal oil and gas spills occurred in the North Sea in 2009 and 2010.

Most of the land-based and shallow-water oil resources have been exploited and many have already passed peak production. There are untapped reserves still available, but many of these lie further out to sea in deeper waters and hostile environments. Despite the risks of exploiting these resources, deep-sea oil exploration offers a viable investment opportunity for companies, given the growing global demand for oil and stubbornly high prices.

In the UK, the majority of offshore wells have been in water depths of less than 100m. But drilling in deeper waters, up to 1,800m, has become more common. Oil company Chevron has been granted permission to drill in the Lagavulin Prospect, west of Shetland, to a depth of more than 1,500m. And, just weeks after the Gannet Alpha spill, the government announced more offshore licences in deeper waters both in the North Sea and the west of Shetland field, on the very edge of the UKCS. DECC estimates the west of Shetland area represents about 17% of the UK’s remaining oil and gas resources.

The risks of drilling in hostile environments cannot be underestimated. A recent communiqué from Total, a major oil and gas group with exploration interests west of Shetland, says that the area is “characterised by extreme environmental conditions, such as wind, wave, temperature and water depth,” adding that “this, combined with the lack of established natural gas infrastructure, makes projects in the area extremely challenging.”

Final frontier

Much further north, beyond the UKCS, is a more challenging environment still. The Arctic Circle is said to contain more than 20% of the world’s undiscovered conventional oil and gas resources. According to a recent US geological survey, areas north of the Arctic Circle hold in excess of 90 million barrels of oil, 1,600 trillion cubic feet of natural gas and 44 billion barrels of gas liquids, mostly in deep offshore areas.

The Arctic’s ice-covered ocean, surrounded by permafrost, is a pristine wilderness and home to a rich variety of wildlife and a sparse population of indigenous peoples. But the ice is receding fast, which is opening up this new oil and gas frontier. The once ice-bound Northwest Passage is now open to commercial shipping most of the year, providing easier access to the precious new resources.

Ironically, global warming, which scientists say is caused mainly by burning oil and other fossil fuels, is largely responsible for melting the ice that has opened up the Arctic. Exploration in the region is now well under way. As these investigations gather pace, the world’s environmental organisations have joined forces to oppose further developments in the Arctic and have called for all licences to be suspended.

The Arctic Council, an intergovernmental panel representing all the countries with land just beyond the Arctic Circle, is drawing up eco-management plans to protect the wilderness. The plans include an Emergency Prevention, Preparedness and Response Working Group and no doubt all participating countries will be required to adhere to international treaties and conventions to minimise risk to human health and the environment.

Accidents on drilling rigs in deep waters are numerous and well documented. Ageing platforms, metal fatigue, equipment failure, human error and severe weather are the main causes of offshore oil disasters. In most cases the damage to wildlife and the environment is serious, but access to emergency response units can help reduce those impacts.

Yet the Arctic remains a hostile environment, notorious for severe weather conditions and freezing waters. From October to March it is in darkness. Its remoteness makes it difficult to set up infrastructures to sustain operations and to provide adequate emergency response in the event of an incident.

Accidents are inevitable, but a disaster on a scale similar to the Gulf of Mexico without adequate back-up would be catastrophic for the Arctic’s pristine and fragile environment.


OSPRAGOSPRAG findings

The final report from the Oil Spill Prevention and Response Advisory Group (OSPRAG) was published on 21 September 2011, and concluded that the UK’s oil spill prevention and response practices and procedures are of a high standard.

“The UK response strategy and capability is essentially robust and can respond effectively to offshore spills that are likely to be encountered,” it found. OSPRAG did, however, make several recommendations to strengthen practices and procedures further.

The creation of a body to share best practice in preventing a major well incident is a key recommendation that has been taken forward with the creation of the Well Life Cycle Practices Forum.

A second body, the Oil Spill Response Forum, has also been established on the recommendation of OSPRAG. It is charged with keeping a “toolkit” – of response techniques that can be applied, where conditions are favourable, to mitigate potential environmental and socio-economic impacts – under review, making further enhancements as and when required.

A visible outcome of the group’s work is a new capping device (pictured). It is designed for deployment in the unique conditions found in the UK continental shelf, and is being held on standby in the northeast of Scotland, ready for use should it be needed to swiftly seal off an uncontrolled well.

OSPRAG, which was established in the aftermath of the Gulf of Mexico oil spill, notes that more than 7,000 wells have been drilled successfully in the UK in the past 20 years, without a major well-control incident.

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