by Kiley Kroh

Total SA, the fourth largest publicly traded oil and gas company in the world, has become the first major oil producer to admit that offshore drilling in Arctic waters is a risky idea, telling the Financial Times yesterday that such operations could be a “disaster,” and warning other companies against drilling in the region.

The company’s CEO, Christophe de Margerie, said the risk of a potentially devastating oil spill was too high and that “a leak would do too much damage to the image of the company.” His note of caution marks the first time a major oil company has spoken out publicly against offshore exploration in the remote and fragile region.

Total’s message to a growing list of influential voices publicly expressing their opposition to offshore drilling in the Arctic Ocean.

• Last week a British parliamentary committee called for a halt to drilling in the Arctic Ocean until necessary steps are taken to protect the region from the potentially catastrophic consequences of an oil spill.  “The shocking speed at which the Arctic sea ice is melting should be a wake-up call to the world that we need to phase out fossil fuels fast,” said committee chair Joan Walley MP. “Instead we are witnessing a reckless gold rush in this pristine wilderness as big companies and governments make a grab for the world’s last untapped oil and gas reserves.”
• German bank WestLB announced it would not provide financing to any offshore oil or gas drilling in the region, saying the “risks and costs are simply too high.”
• Insurance giant Lloyd’s of London issued a report warning that responding to an oil spill in a region that is “highly sensitive to damage” would present “multiple obstacles, which together constitute a unique and hard-to-manage risk.”

After spending nearly $4.5 billion and over five years pursuing exploratory drilling off Alaska’s northern coast, Shell Oil announced earlier this month that it would be forced to postpone exploratory drilling until next year after a series of mishaps with equipment and unpredictable sea ice in the region. But the debate is far from over. The company plans to use the remainder of the season drilling preparatory wells in order to resume exploratory operations as quickly as possible in 2013.

Though Total plans to continue with its natural gas ventures in the Arctic, saying gas leaks are easier to contain than oil spills, de Margerie’s warning should not be taken lightly. In addition to severe and unpredictable weather and the gaps in our scientific knowledge about oil spills there, the region also lacks the basic infrastructure necessary to respond to a disaster.

Watch a short documentary on the lack of infrastructure:

If the challenges posed by the fragile and untested Arctic — coupled with the warnings of major insurers, financiers, and legislative bodies — aren’t enough to hit the pause button on exploratory drilling in the Arctic Ocean, then perhaps a fellow oil company expressing its concern is final proof that the risks are too great to rush into drilling the world’s last unspoiled frontier.

Kiley Kroh is the Associate Director of Ocean Communications at the Center for American Progress.

by Anthony Swift, via NRDC’s Switchboard

An investigation of pipeline accident reports from the last ten years has revealed that the much touted leak detection systems employed by pipeline companies only catch one out of twenty spills.

The article, by Lisa Song of InsideClimate News, illustrates an alarming disconnect between industry rhetoric and reality when it comes to detecting leaks on pipelines. Not only do pipeline leak detection systems miss nineteen out of twenty spills, they miss four out of five spills larger than 42,000 gallons. Understanding the limits of current leak detection technology has never been more important. As companies like Enbridge and TransCanada propose pipelines moving large volumes of tar sands across sparely populated areas, through rivers and aquifers, it’s critical that the public consider what’s at stake with open eyes. Particularly after learning from Enbridge’s Kalamazoo tar sands pipeline spill how much more damaging tar sands can be.

What does that mean for tar sands pipelines like Keystone XL and Northern Gateway?

TransCanada has told regulators that its leak detection system has a threshold of between 1.5% and 2%. Given that Keystone XL has a maximum capacity of 830,000 barrels of tar sands per day, TransCanada is saying that Keystone XL’s leak detection system can only reliably identify leaks if they’re spilling more than 500,000 to 700,000 gallons of tar sands a day. When put in that context, the reason folks don’t want Keystone XL built through their rivers and groundwater become clear.

Of course, TransCanada has told federal regulators that “computer based, non real-time, accumulated gain/loss volume trending would assist in identifying seepage releases below the 1.5 to 2 percent” threshold. In plain English, that means that given enough time, if TransCanada put a certain amount of tar sands in one end of Keystone XL, and gets less oil out of another, eventually they’ll determine they have a leak. But when?

Few would take heart upon learning the answer to that question. One of the “57 special conditions” that Keystone XL proponents claim will make the pipeline safer lays out the requirements its “non real time” leak detection system. Condition 31 says that Keystone XL’s leak detection system must be prepared using guidance provided in the Canadian Standards Association (CSA). And what does the CSA say?

To comply with this “special condition,” TransCanada’s non-real time leak detection system must be able to detect spills of 4.9 million gallons within a week (or 2% of its capacity). Leaks larger than 350,000 gallons a day, or 1% of its capacity, must be identified within a month – allowing a leak to generate a spill of over 10 million gallons over the course of a month before discovery. And there is no guidance for leaks less than one percent – on Keystone XL, a leak less than 350,000 gallons a day. When looking into it at way, the condition doesn’t seem that special.

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by Joe Smyth, via The Witness blog

Oil is washing up along the Gulf Coast in the wake of Hurricane Isaac, confirming concerns that the storm could churn up oil in the Gulf of Mexico. A Greenpeace research team took samples from beaches along the Alabama coast on September 2, including from an area with hundreds of tar balls in the Bon Secour National Wildlife Refuge.

According to the US Coast Guard, oiled pelicans and other wildlife have been found in Louisiana marshes as well. As people struggle with flooding, wind damage, and power outages in the wake of the hurricane, officials have expressed concerns that on top of that disaster, Hurricane Isaac may stir up oil from the BP spill:

“This is another disaster on top of the hurricane that we’re going to have to deal with,” Garret Graves, chairman of Louisiana’s Coastal Protection and Restoration Authority, told The Huffington Post. “The threat is not insignificant.”

Up to 1 million barrels of oil are estimated to remain in the Gulf of Mexico. That oil remains, Graves said, because BP has failed to clean it all up in the more than two years since the tragedy. “That’s four to five times the oil that was spilled with the Exxon Valdez,” he added.

Meanwhile, officials in Washington DC are calling on federal agencies to provide an update on their oil spill cleanup efforts in the wake of Hurricane Isaac:

Rep. Edward Markey (D-Mass.) wants two federal agencies to explain how they will address lingering oil contamination from the 2010 explosion of the BP Deepwater Horizon drilling rig.

Markey told the heads of the Environmental Protection Agency (EPA) and the National Oceanic and Atmospheric Administration (NOAA) in letters sent Friday that Hurricane Isaac makes the Gulf of Mexico cleanup effort imperative.

– Joe Smyth is a media officer with Greenpeace USA. This piece was originally published at Greenpeace’s The Witness blog and was reprinted with permission.

Today in Houston, the U.S. Chemical Safety Board will present the results of its investigation into the causes behind 2010′s devastating oil spill in the Gulf of Mexico.

The board found that BP failed to pay adequate attention to the safety of its rig systems, focusing instead on worker safety precautions like proper boots.

The board concluded that “BP applied lesser process safety standards” to contracted drilling rigs and that the company “dropped the ball on major accident hazards.” It also concluded that the disaster can be largely blamed on BP’s lack of “comprehensive hazard evaluation” for the Deepwater Horizon rig and the Macondo well.

Safety board managing director Daniel Horowitz told the Associated Press that BP was chronically short-sighted in its safety measures:

BP “did not conduct an effective comprehensive hazard evaluation of the major accident risks for the activities of the Deepwater Horizon rig or for the Macondo well” and accounted only for previous BP assets, not temporary ones like Deepwater Horizon. The Chemical Safety Board found that BP “focused on financial risks, not process safety risks” when drilling offshore.

The board’s presentation highlights the difference between worker safety measures and system safety measures, which are designed to make sure rigs are safe and not subject to leaks or combustion. The board found that BP and Transocean had an “inadequate” system in place.

Chemical Safety Board spokesperson Cheryl Mackenzie said the neglect bears an “eerie resemblance” to what the agency found in its investigation of the 2005 Texas City Refinery BP explosion, which killed 15 people. In that case, BP failed to ensure system safety by overlooking safety indicators like well kicks, flammable gas leaks and equipment damage.

“One of the main lessons coming out of the Texas City disaster was the need for a separate focus on process safety as opposed to personal safety,” board member Dr. Anthony Hopkins explains in a working paper, noting that the U.S. has weak regulations on rig safety indicators. Ian Whewell, another board member, said that the problem does not seem to be improving: “[I]t is clear that performance indicators are in many companies still not being used as effectively as they should be to control major accident risks.”

The 2010 BP oil spill killed 11 people and released 5 million barrels of crude oil into the Gulf of Mexico. Though BP has spent millions on an ad campaign promoting their response to the spill, the work to identify the damage has just begun. In April, Al Jazeera reported that Gulf seafood is showing signs of drastic deformities from the spill, such as eyeless shrimp and fish riddled with lesions. Researchers have also said the oil spill contributed to a “perfect storm” for mass dolphin deaths in the Gulf.

– Ben Sherman

Two years after the Deepwater Horizon disaster, BP has mostly resumed normal operations in the Gulf of Mexico. But many animals in the Gulf haven’t gone back to normal.

Researchers have connected a recent dolphin die-off to the 2010 oil spill, which likely weakened dolphins for colder conditions in Gulf waters.

According to a study from scientists at the Dauphin Island Sea Lab, published in PLoS ONE, 186 young dolphins washed ashore along Gulf coasts during a four-month period between January 1 and April 30 2011. This included 86 baby dolphins, which is six times more than the average.

University of Central Florida biologist and study researcher Graham Worthy said:

“Unfortunately, it was a ‘perfect storm’ that led to the dolphin deaths. The oil spill and cold water of 2010 had already put significant stress on their food resources. . . .   It appears the high volumes of cold freshwater coming from snowmelt water that pushed through Mobile Bay and Mississippi Sound in 2011 was the final blow.

Other studies have connected the massive dolphin die-off to the BP spill. Earlier this year, the National Oceanic and Atmospheric Administration found that dolphins off the coast of Louisiana — an area significantly hit by the spill — have become seriously ill due to oil exposure. NOAA “found problems like drastically low weight, low blood sugar and, in some cases, cancer of the liver and lungs.”

Since Febrauary 2010 (two months before the spill) 754 marine mammals have washed onto the shore, 95 percent of which were dead. The actual death toll could be much higher since many bodies never wash up.

The BP disaster has hit other marine life, as well, causing eyeless shrimp and fish with lesions.

The Arctic is undergoing rapid changes accelerated by a warming planet, opening up new potential shipping routes, tourism opportunities, and fossil fuel reserves.

Royal Dutch Shell is leading the charge in oil extraction. The company has already shipped its fleet of rigs up to Alaska where it is waiting for the go-ahead from the federal government to begin exploratory drilling in icy Arctic waters.

Other companies such as Exxon Mobil, Gazprom, Statoil, and Total are also planning on expanding future operations in the Arctic.

But a growing group of disaster-response officials, political leaders, environmental groups, and scientists are all raising concerns about the environmental impact of this new drilling activity. With virtually no infrastructure in place to clean up an oil spill, the consequences of a well blow-out could be disastrous.

The long-term consequences could be equally bad. As Arctic sea ice continues its death spiral, fossil fuel companies seeing new opportunities under the waters are swooping in — increasing the extraction of carbon-based fuels that are contributing to global warming.

In this podcast, linked above, we’ll speak with Michael Conathan, director of oceans policy at the Center for American Progress, who has been watching the activity in the Arctic closely. He’ll discuss a new report, Putting a Freeze on Arctic Ocean Drilling, and talk about the various environmental and infrastructure challenges in the region.

You can follow our podcast RSS feed here. A transcript of the conversation is below:

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by Kiley Kroh

Royal Dutch Shell’s preparedness to drill offshore in the harsh and remote Arctic Ocean this summer has been called into question by a series of recent events.

Over the weekend, the company’s drilling rig, the Noble Discoverer, appears to have come dangerously close to running aground near Dutch Harbor, where Shell’s fleet has been assembled.  The Noble Discoverer is one of two dozen ships Shell plans to send into some of the most challenging conditions on the planet.  According to the US Coast Guard, the vessel slipped anchor and drifted within 100 yards off shore before being pulled back into deeper water by a Shell tugboat.

The Los Angeles Times reports:

The vessel‘s anchor failed to hold and the 514-foot ship began drifting, but its movement was halted when tug boats were called in to assist, Coast Guard spokeswoman Sara Francis told the Los Angeles Times.

“We don’t know exactly what happened yet. We do know that the vessel’s anchor didn’t hold, they began to drift, they let out more anchor chain to slow that drift and called for immediate tug assistance,” Francis said.

Although Shell and the Coast Guard asserted there was no evidence of grounding, onlookers — including longshoreman David Howard and Dutch Harbor captain Kristjan Laxfoss — contradicted this account, saying the vessel was not moving and appeared grounded: “There’s no question it hit the beach. That ship was not coming any closer. It was on the beach.”

Petty Officer Sarah Francis said winds of 27-35 miles per hour likely led to the ship drifting — conditions that are benign compared with the hurricane-force gales, 20-foot swells, and dynamic sea ice the Discoverer could encounter off the North Slope where the company plans to drill offshore.

Pete Slaiby, vice president of Shell Oil in Alaska, noted both the Discoverer and Kulluk drilling ships will be secured by an 8-point anchor system when operating in the Beaufort and Chukchi Seas.

The incident immediately follows the Coast Guard’s refusal to certify Shell’s oil spill response barge, the Arctic Challenger, because of concerns about the fire protection system, wiring, and piping on the 37 year-old vessel. The Coast Guard also expressed doubts about the barge’s ability to withstand harsh Arctic storms. The containment barge is essential to the fleet as it is designed to deliver oil spill response equipment to the five drilling sites. Without it, Shell would not have access to the equipment necessary to contain an oil spill in the Arctic Ocean.

In addition to the extreme and unpredictable weather, there is an alarming dearth of infrastructure necessary to mount a large-scale response effort off the North Slope. As detailed in the Center for American Progress report, Putting a Freeze on Arctic Ocean Drilling: America’s Inability to Respond to an Oil Spill in the Arctic, the area lacks roads, railroads, a permanent Coast Guard facility, a major port, or sufficient infrastructure to house and feed a large influx of people.  As a result, Shell has said that its oil spill response efforts will be largely self-contained.  The fact that the company is experiencing problems with this equipment before even reaching the drill sites raises serious concerns about their contingency plan.

Shell’s flotilla will continue to wait in Dutch Harbor – 1,000 miles south of the proposed drilling sites; the closest major port to the North Slope – while unexpectedly heavy sea ice prevents them from making the voyage to the Beaufort and Chukchi seas.

Slaiby, Shell’s VP in Alaska, recently told CNN that the company’s proposed exploration in the Arctic will be the “most complex, most difficult wells we’ve drilled in company history.”

Kiley Kroh is the Associate Director of Ocean Communications at the Center for American Progress.

by Ben Bovarnick

In the event of an offshore oil spill in the Arctic, Shell has previously admitted it can only “encounter” most of the oil in the frigid, pristine waters — not clean it up. However, it may lack the resources to do even that.

As Shell’s fleet sails north to prepare offshore drilling in Arctic waters, Shell’s oil spill recovery barge, the Arctic Challenger, remains docked in northern Washington after failing to receive Coast Guard certification. The Los Angeles Times reports:

The delay in certification adds another notch of uncertainty to Shell’s narrow window for operations in the Arctic, which already is tight because drilling must halt by September in the Chukchi Sea and by October in the Beaufort Sea to avoid the dangerous advance of sea ice that comes with winter. Though drilling initially was scheduled to commence by mid-July, unusually heavy sea ice from the past winter has postponed that, probably until the first week of August.

The federal Bureau of Safety and Environmental Enforcement has said it will not issue final drilling permits until the Arctic Challenger receives final Coast Guard certification.

The Coast Guard raised concerns about the fire protection system, electrical wiring, and piping on the 37-year old vessel, as well as its ability to withstand a “100-year storm” — an event with a 1 percent likelihood of occurring over the course of a century.  Shell operators contend that the Coast Guard requirement for the barge to withstand a 100-year storm is unnecessary, believing the ability to withstand a 10-year storm is sufficient.

Just last year, Alaska was hit with “of the most severe Bering Sea storms on record,” only a week after the end of Shell’s proposed Beaufort drilling season.

The barge, languishing in northern Washington for the next three weeks, serves to transport oil containment equipment to any of the five exploration wells Shell intends to drill. The absence of this vessel as Shell’s fleet treks north is especially alarming given the lack of infrastructure in Northern Alaska available to respond to a spill, and Shell’s safety violations in while drilling in the North Sea.

At a congressional hearing in 2011, Commandant Robert Papp, head of the U.S. Coast Guard, expressed his skepticism in the Coast Guard’s ability to respond effectively to an oil spill in the Arctic Ocean, saying “if [a spill] were to happen off the North Slope of Alaska, we’d have nothing.  We’re starting from ground zero today.”

As detailed in a report from the Center for American Progress, the lack of infrastructure in Northern Alaska necessary to respond to a spill is staggering. The nearest major port is over 1,000 miles away from the drill sites and “there are no roads whatsoever connecting communities along the North Slope of Alaska.”

In an environment as pristine, yet unpredictable, as the Arctic, Shell must be prepared for all possibilities.  It is not enough to hope that containment is unnecessary, and if Shell rushes their processes, they may well find themselves unprepared for the consequences.

Ben Bovarnick is an intern on the energy policy team at the Center for American Progress.

by Joe Smyth

As Shell’s rigs head toward the Arctic to exploit melting sea ice to drill for more oil, the company took a small step this weekend in clarifying what would happen in an oil spill during the company’s planned Arctic drilling operations this summer.

Despite the oil industry’s spin, experts know it is impossible to recover more than a small fraction of a major marine oil spill, as retired Coast Guard Admiral Roger Rufe told NPR: “But once oil is in the water, it’s a mess. And we’ve never proven anywhere in the world — let alone in the ice — that we’re very good at picking up more than 3 or 5 or 10 percent of the oil once it’s in the water.”

So how is it possible, according to the New York Times, that Interior Secretary Ken Salazar “said he believed the company’s claims that it could collect at least 90 percent of any oil spilled in the event of a well blowout.” These sorts of claims have raised eyebrows among advocates and scientists who study offshore oil drilling — they aren’t just unbelievable, they’re laughably, outrageously impossible. NPR’s Richard Harris cuts through Shell’s spin, and explains what these numbers really mean:

“They have a miniscule number of boats compared to what was available in the Gulf of Mexico,” [Peter Van Tuyn, and environmental lawyer in Anchorage] says, and in the Gulf, “they didn’t have to deal with the extreme weather conditions that we’ve got in the Arctic.” High winds are the norm, and sea ice is always a possible hazard, “and yet they [Shell] claim they can collect as much as 95 percent.”

Merrell says the company has made no such claim. Instead, he says, the oil company’s plan is to confront 95 percent of the oil out in the open water, before it comes ashore. That doesn’t mean responders can collect what they encounter.

“Because the on-scene conditions can be so variable, it would be rather ridiculous of us to make any kind of performance guarantee,” Merrell says.

While discussing the same issue with the Associated Press, Shell PR folks take another word out for a spin, and even try to blame “opposition groups” for this confusion:

Shell Alaska spokesman Curtis Smith said opposition groups are purposely mischaracterizing Shell’s oil spill response plan. The plan does not claim Shell can clean up 90 percent of an oil spill, he said.

“We say in our plan we expect to ‘encounter’ 90 percent of any discharge on site — very close to the drilling rig,” he said. “We expect to encounter 5 percent near-shore between the drilling rig and the coast. And we expect to encounter another 5 percent on shore. We never make claims about the percent we could actually recover, because conditions vary, of course.”

Where Shell plans to drill in the Arctic, those conditions include 20 foot swells, hurricane force winds, sea ice, and months of total darkness, and all without deep water ports or other infrastructure needed to mount a major oil spill response. But let’s put that aside for a moment, to make sure we’re not mischaracterizing here: Shell expects to “encounter” or “confront” 90% of the spilled oil and another 5% the company plans to — rendezvous? — with elsewhere in the ocean, while the remaining 5% Shell might — happen upon? — on shore. How much of that oil might be recovered, collected, or, you know, removed from the environment? Well, Shell says conditions vary, so making a performance guarantee would be rather ridiculous.

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With virtually no infrastructure available to clean up an oil spill in the sensitive Arctic, the Obama Administration is still pushing to get offshore drilling projects developed in the region.

What’s the messaging strategy from the Administration? Trust Shell.

Talking to reporters about exploration permits for Arctic waters yesterday, Interior Secretary Ken Salazar summed up the Administration’s approach: “I believe there’s not going to be an oil spill.”

Really?

Shell has faced more legal prosecutions for safety and environmental transgressions than any other major oil company drilling offshore in the North Sea.

And let’s remember, the Arctic is a place where the Coast Guard has warned “if [a spill] were to happen … we’d have nothing. We’re starting from ground zero today.”

Heck, even one of the world’s largest insurance pools refuses to back offshore drilling operations in the Arctic, saying the environment is “highly sensitive to damage” and that the risk is “hard to manage.”

Discussing the technique of foreshadowing, Russian playwright Anton Chekhov once wrote: “If in the first act you have hung a pistol on the wall, then in the following one it should be fired.”

As we see in the graphic below, Obama already proved himself a master of foreshadowing in the lead up to the Deepwater Horizon disaster. Let’s hope Salazar doesn’t do the same. (Hat tip to Greenpeace’s Joe Smyth for the image).