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Bubbling and Crude: Gulf coast spill reflects devotion to wealth, power, and oil

May 5, 2010 by · 4 Comments 

By Keith Schneider
US Climate Action Network

On March 17, two weeks to the day before President Barack Obama laid out a new plan to expand offshore oil exploration in the United States, a government auction of federally controlled oil and gas reserves in the Gulf of Mexico was held at the New Orleans Superdome.  It took just a few hours for 77 energy companies to pledge $1.3 billion to the U.S. Treasury to look for oil and natural gas across a 2.4 million-acre expanse of bottomlands 200 miles from shore, and in most cases thousands of feet below the surface.

The lease sale, one of the most lucrative on record, bolstered the Gulf’s global reputation as one of the hottest deepwater oil and gas plays on Earth. The Gulf of Mexico is responsible for a quarter of the 5.5 million barrels of oil produced daily in the U.S., according to the Department of Energy. And of the 1.4 million barrels produced daily in the Gulf, 1.1 million barrels comes from under 100 deep sea production platforms. The Interior Department predicts that by the end of the decade, deep sea production in the Gulf could reach nearly 2 million barrels a day.

oilresourcepage

Source: The Economist

Though offshore oil production is dangerous – 165 people died when an offshore platform exploded off the coast of Scotland in 1998; 10 more people were killed in a drilling rig explosion off the coast of Brazil in 2001 – a kind of Titanic syndrome had set in with Gulf coast oil explorers. The high-tech, semi-submersible, nearly $1 billion floating drilling platforms that operated in the deep Gulf waters were seen as too big, too modern, too well-equipped to fail.

Moreover there is so much oil (and natural gas) beneath the deep Gulf bottomlands – 85.9 billion barrels of oil, according to several estimates – and so much money to be made at $70 to $100 a barrel, that downplaying the risks made economic and political sense. Federal drilling permits obtained by developers normally did not require extensive and time-consuming analysis of the environmental risks, the government has acknowledged.

On April 20, an explosion and fire aboard Transoceans’ Deepwater Horizon drilling platform, which was operating under contract to BP, killed 11 workers. The accident provided the latest unmistakable evidence of the workplace hazards of deep sea exploration. Then two days later, on Earth Day’s 40th anniversary, the Deepwater Horizon sank and simultaneously produced an oil slick that the government says is growing by about 5,000 barrels of oil daily.

America Awake?
By any measure, the Gulf spill has reawakened the nation and magnified the human, environmental, and political consequences of oil production, especially from such treacherous places as the deep ocean. But the spill has not yet made clear what, if anything, the nation is prepared to do in response.

There is no longer much reasoned debate that America’s devotion to fossil fuel, and especially to oil, has contributed to dangerous energy insecurity, rising atmospheric concentrations of global warming pollution, increasing costs, decreasing incomes, and a ferocious national recession.

President Obama on April 30 announced he would suspend his March 31 decision to open new areas to offshore exploration pending a full investigation of the Deepwater accident. In the Senate, where a climate and energy bill has been delayed because of partisan infighting, lawmakers debated whether the Gulf spill would 1) break or 2) cement the deadlock.

It is clear the United States needs a new energy policy.  The devastating spill has heightened awareness on Capitol Hill to the dangers of U.S. dependence on oil.  Democratic Senators Robert Menendez and Frank Lautenberg of New Jersey, and Bill Nelson of Florida held a news conference this week to alert their colleagues that including additional offshore oil exploration has no place in a comprehensive climate and energy bill.

Halting the Spill

Oil Drilling Timeline

Gulf-of-Mexico-Average-Annual-Oil-Production

In the Gulf, BP says it is moving as fast as it can to plug the well and on Wednesday the company announced that it had stemmed one of three leaks in the pipe that once attached the well to the Deepwater drilling platform. Fishing in the coastal waters, some of the most productive fishing grounds on the planet, has been suspended. Meanwhile the governors of Louisiana, Alabama, Mississippi, and Florida expressed concern about the expanding spill, which was drifting closer to their shores.

USCAN will closely follow the events surrounding the oil spill, with a particular focus on what effect, if any, it could have on action in Washington to develop and approve a climate and energy bill fit for the 21st century.

Deepwater-Production

Percent-of-total-production

Total-GOM-OCS-Production

Production Data by Year
Deepwater Production
(WD > 1000 Ft)
Total GOM OCS Production % of Total Production
Year Oil, STB Gas, MCF Oil, STB Gas, MCF Oil Gas
1985 21,053,752 33,849,349 350,345,117 4,057,692,707 6.009 0.834
1986 19,077,066 36,900,361 355,542,244 4,043,350,172 5.365 0.912
1987 17,070,926 44,259,499 327,567,672 4,524,823,392 5.211 0.978
1988 12,984,552 38,228,499 301,206,145 4,577,391,080 4.310 0.835
1989 10,007,573 31,889,109 280,717,909 4,636,327,746 3.564 0.687
1990 12,141,988 30,502,933 274,588,473 4,907,774,159 4.421 0.621
1991 22,886,754 58,434,483 294,773,846 4,707,640,841 7.764 1.241
1992 37,295,127 87,256,174 304,865,294 4,650,566,185 12.23 1.876
1993 36,769,914 119,895,532 308,595,948 4,655,807,596 11.91 2.575
1994 41,803,238 159,473,125 314,096,027 4,823,738,315 13.30 3.306
1995 55,200,884 181,019,918 345,074,597 4,778,657,050 15.99 3.788
1996 72,213,069 278,233,940 368,869,292 5,076,875,432 19.57 5.480
1997 108,514,650 381,759,185 411,622,518 5,145,646,361 26.36 7.419
1998 159,232,680 560,475,922 444,286,882 5,041,746,574 35.84 11.11
1999 225,089,761 845,581,180 495,172,107 5,057,740,045 45.45 16.71
2000 271,144,316 998,859,653 523,029,835 4,958,172,377 51.84 20.14
2001 315,392,362 1,178,429,028 558,790,340 5,060,515,587 56.44 23.28
2002 348,566,124 1,286,974,486 567,887,406 4,526,660,570 61.37 28.43
2003 350,151,883 1,425,729,552 561,457,768 4,428,661,841 62.36 32.19
2004 347,916,489 1,396,450,720 535,313,731 4,005,649,257 64.99 34.86
2005 325,565,912 1,189,574,009 466,916,529 3,155,021,736 69.72 37.70
2006 341,286,543 1,093,900,026 472,034,405 2,921,947,061 72.30 37.43
2007 328,111,873 1,027,012,933 468,007,128 2,812,063,179 70.10 36.52
2008 310,628,395 997,860,793 421,221,179 2,328,093,003 73.74 42.86
2009 454,502,063 1,094,148,891 566,000,231 2,427,822,032 80.30 45.06
Deepwater Production Increase – Year to Year
Year % Increase, Oil % Increase, Gas
1985 to 1986 -9.3 9.01
1986 to 1987 -10. 19.9
1987 to 1988 -23. -13.
1988 to 1989 -22. -16.
1989 to 1990 21.3 -4.3
1990 to 1991 88.4 91.5
1991 to 1992 62.9 49.3
1992 to 1993 -1.4 37.4
1993 to 1994 13.6 33.0
1994 to 1995 32.0 13.5
1995 to 1996 30.8 53.7
1996 to 1997 50.2 37.2
1997 to 1998 46.7 46.8
1998 to 1999 41.3 50.8
1999 to 2000 20.4 18.1
2000 to 2001 16.3 17.9
2001 to 2002 10.5 9.21
2002 to 2003 0.45 10.7
2003 to 2004 -0.6 -2.0
2004 to 2005 -6.4 -14.
2005 to 2006 4.82 -8.0
2006 to 2007 -3.8 -6.1
2007 to 2008 -5.3 -2.8
2008 to 2009 46.3 9.64
Average (through 2008) 16.7 18.3

Source: Minerals Management Service

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