UpdateUS offshore oil must dramatically improve safety - report

11 January 2011 16:40  [Source: ICIS news]

(adds updates throughout)

HOUSTON (ICIS)--The US oil and gas industry must take its own, unilateral steps to “dramatically increase” safety in offshore drilling activity, as regulatory oversight alone is not sufficient, the presidential commission for the Gulf of Mexico oil spill said on Tuesday.

Such steps need to include self-policing mechanisms that supplement governmental enforcement, the commission said.

“The technology, laws and regulations, and practices for containing, responding to and cleaning up spills lag behind the real risks associated with deepwater drilling into large, high-pressure reservoirs of oil and gas located far offshore and thousands of feet below the ocean’s surface,” the report said.

“Government must close the existing gap and industry must support rather than resist that effort,” it added.

In its full oil spill report issued on Tuesday, the commission said the blowout of the Deepwater Horizon oil rig was preventable, placing blame at the door of BP and its two subcontractors, Halliburton and Transocean.

The report cited recurring themes of missed warning signals, failure to share information and a “general lack of appreciation for the risks involved”.

“In the view of the commission, these findings highlight the importance of organisational culture and a consistent commitment to safety by industry, from the highest management levels on down,” the report said.

“Much as the aviation, chemical, and nuclear power industries have done in response to disasters, the oil and gas industry must move towards developing a notion of safety as a collective responsibility,” the report said.

It cited the nuclear power industry response to the 1979 Three Mile Island power plant accident and the subsequent creation by the industry of the Institute of Nuclear Power Operations.

From a legislative standpoint, recommendations made by the panel included increasing budgets and training for federal offshore drilling regulators, increasing the liability cap for damages, and for 80% of spill-related penalties to be dedicated to the long-term, region-wide restoration of the Gulf.

Following the report’s release, the American Petroleum Institute (API) said it was “deeply concerned” by the recommendations, arguing that the industry had already taken significant steps to improve safety.

BP, Halliburton and Transocean did not immediately respond to requests for comment.

The explosion on the Deepwater Horizon oil rig on 20 April 2010 killed 11 workers. It caused a huge oil leak, which led to the largest spill in US Gulf history before it was plugged in August.

Additional reporting by Joe Kamalick

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By: Ben DuBose
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