Americans don’t like to think much about where their gasoline comes from. They’re happy when supplies are plentiful and prices are cheap. Many have painful memories of oil embargoes, gas lines and price spikes, and prefer those episodes not be repeated. Americans expect gasoline to be as reliable as electricity.
The oil industry satisfies their demand. Some 30% of domestic oil (along with 11% of natural gas) comes from the Gulf of Mexico. Considering that 35,000 workers are engaged in a heavy industry that operates 24 hours a day in a marine, all-weather environment, the safety and environmental record in the Gulf of Mexico is pretty remarkable.
There have been incidents. The worst spill in the Gulf was the Bay Marchand spill in 1970, a near-shore production incident. The greatest losses of life occurred in 1987, when 13 men perished in a helicopter accident, and in 1976 when 11 men died, ironically, when their emergency survival capsule overturned while being towed.
I can’t remember a previous drilling incident in the Gulf with the nationwide significance of the Deepwater Horizon blowout.
BP was drilling in 5,000 feet of water. Given the cost, risk and operating challenges of that environment, why would anyone bother?
My company has never considered it. We operate on the “shelf” of the Gulf of Mexico, mostly in waters of 200 feet or less. We don’t use subsea blowout preventers. Ours are “dry”, on the surface. We rarely use ROVs (remotely operated vehicles) and divers can dive to any depths we might require. On the shelf, cost to drill and produce wells are a tiny fraction of deepwater costs. And the risk is much less. Problems, if they happen, are more easily controlled when the valves are at the surface instead of under a mile or so of sea water.
But the chance that we’ll find a really big field on the shelf is nill. Geologists say the shelf is very mature, or “picked over”; think of a cotton field after it’s already been worked once. Most U.S. drillers these days are working that second or third harvest because all the domestic basins are so thoroughly exploited. That’s my company’s niche, so we’re content to limit our search to shallow water.
By contrast, the deepwater Gulf of Mexico is not mature. There, the major multinational companies still find the world-class prospects which have the potential of providing oil in the huge quantities their integrated infrastructures need (i.e., refining, distribution and marketing, in addition to exploration and production). The majors must find reserves in big chunks, and produce their wells at high rates, so that they can satisfy our demand for uninterrupted and readily available supply.
There are also big prospects to drill elsewhere, in Africa, the Middle East, Brazil, and the Far East. The U.S. offers political stability and security of ownership that many foreign countries do not. But Americans’ attitude toward drilling has gone beyond “Not In My Back Yard!” Now it’s “Not Near Anything With a Pretty View!” and “Don’t Interfere With Mating Pronghorn Antelopes or Nesting Sage Grouse!” We’ve kept 85% of the Outer Continental Shelf off-limits for exploration for a generation.
So the majors turn to the deepwater Gulf of Mexico, the only domestic basin where they can find the “elephants” they need to sustain their businesses.
By keeping 85% of the OCS off limits to drilling, we’re holding back large swaths of shallow water where less risky offshore shelf technologies could be used.
If you agree with continuing the official policy of limiting drilling access, at least consider the consequences of your position.
Despite all the advertising by “green” interest groups and adminstration rhetoric, DOE’s Energy Information Agency forecasts increasing use of petroleum through at least 2030. That same forecast also assumes explosive growth in renewables, including biofuels. Our appetite for energy is voracious. As “green” as we’d like to think we are, individual consumers change their consumption habits very slowly.
So increased oil consumption, absent domestic growth of supply, necessarily means more dependence on potentially hostile regimes and less security at home.
It also means that more oil will be imported in tankers. Offshore, we use pipelines, which limit the volume in the event of a spill. Much more oil is spilled from ships, barges and boats than from the offshore oil and gas industry. Exxon Valdez and recent spills on the Delaware and Mississippi Rivers prove the point: transporting oil in boats is riskier than shallow water oil production.
The offshore industry was born and came of age right here in South Louisiana. The industry has learned its lessons from past failures. Despite the Deepwater Horizon incident, the offshore industry remains a safe, invaluable source for the nation’s energy supply.
Steve Maley is operations manager for a small Gulf of Mexico energy firm in Lafayette, LA. Steve is also Contributing Editor for Energy and Environmental Issues at RedState.com, writing under the nom-de-blog ‘Vladimir’.
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