Cassidy: Gulf Spill Shouldn’t End Offshore Drilling

Posted June 27, 2010 at 3:48pm

The Deepwater Horizon spill was not an act of God; it was the product of human and mechanical error. These errors are identifiable and preventable.

[IMGCAP(1)]For example, BP centered the well pipe for cementing with six braces, rather than the 21 braces recommended by cement contractor Halliburton, and it used a method of constructing the well that has been criticized as inferior to the industry’s best practices. When the blowout preventer was activated, it failed to properly deploy. There are questions as to whether the BOP was properly maintained and tested.

The day of the explosion, a decision was made to replace drilling mud with sea water, despite evidence that the well was beginning to “flow” three hours before the explosion. Immediately prior to the explosion, the flow meter indicated that the well was flowing. This evidence was ignored or misinterpreted.

This was also a failure of oversight. According to BP’s drilling permit, which was approved by the Minerals Management Service, the company’s plan in case of a major blowout was to drill a relief well. BP officials said that they were prepared to handle a major oil spill. Clearly, they were not.

Now, there are calls to end offshore production altogether, despite the fact that procedures and policies that led to the Deepwater Horizon spill can be fixed.

The consequences of this spill are excruciating, but demanding an end to offshore production is an emotional overreaction to a problem that demands serious, evidence-based solutions. The repercussions of such short-sighted policy are immediate and severe.

Ending offshore production is equivalent to unilateral disarmament. Doing so would not end America’s dependence on oil and gas; it would simply make America more dependent on other nations’ oil and gas. Every gallon not produced at home is a gallon imported from abroad, most often from Organization of Petroleum Exporting Countries nations.

Ironically, importation is worse for the environment than drilling. To begin, it is worth noting that 19,142 wells have been drilled offshore since 2000 and only 0.001 percent of petroleum produced offshore has spilled over the past 30 years, according to the MMS. And even accounting for the Deepwater Horizon spill, statistically, far more oil is spilled from oil tankers than from oil rigs. Not so distantly, there have been tanker spills in New Jersey, California and Alaska.

An offshore moratorium is also a job killer, not for executives at multinational energy corporations but for welders, pipefitters, roustabouts and the range of service and support industries connected to them. And these blue-collar workers won’t be able to make their mortgage payments or buy groceries for their families with unemployment checks and food stamps.

Job losses spurred by ending offshore production would extend far beyond the industry itself. The average multiplier effect for a job in energy production is 5.5. In other words, every job created in energy production leads to the creation of almost six more. The reverse is also true. Job losses would be most acute in areas most affected by the Deepwater Horizon spill, such as coastal Louisiana.

Even a temporary moratorium has significant economic consequences. The deep-water drilling rigs, upon which many of these jobs depend, can rent for $500,000 per day. During a moratorium, these rigs will be towed to Africa or Brazil to begin multiyear projects. Jobs directly and indirectly associated with these rigs will go to Africa and Brazil with them. This isn’t hypothetical; it’s already happening. Anadarko Petroleum Corp. already announced that it is moving rigs from the Gulf to other countries, and officials at Port Fourchon, La., have said that some of their tenants are weighing layoffs.

Instead of a knee-jerk overreaction, the president and Congress should pursue rational policy. There is a middle ground. Do a real-time analysis of what went wrong and implement corrective measures successively based on what we have learned.

We can prevent another spill without doing further damage to the economy. Stronger safety and environmental protection can be instituted while protecting American energy security, avoiding the risk of increased petroleum imports and preserving jobs.

Rep. Bill Cassidy is a Louisiana Republican.