IS THIS A HOAX?

Comment by Arend Lammertink, MSc. (right) on “Shell CEO: Nat Gas To Play Prominent Global Energy Role”

Posted on Sep 14th, 2010 at 12:27 pm

THE NEW YORK TIMES

A version of this article appeared in print on September 14, 2010, on page D1 of the New York edition.

By LESLIE KAUFMAN and SHAILA DEWAN

NEW ORLEANS — Marsh grasses matted by oil are still a common sight on the gulf coast here, but so are green shoots springing up beneath them.

In nearby bird colonies, carcasses are still being discovered, but they number in the thousands, not the tens of thousands that have died in other oil spills.

And at the mouth of the Mississippi River, the zone of severely oxygen-depleted water that forms every summer has reappeared, but its size does not seem to have been affected by the Deepwater Horizon spill.

How much damage resulted from almost five million barrels of oil pouring into the Gulf of Mexico is still being toted up in laboratories and government offices. It will be some time before the government releases its formal assessment of the effects — one that will define the scope of environmental restoration required by BP, Deepwater Horizon’s operator, and other companies.

Separately, scientists are arguing heatedly about how fast a large plume of dispersed oil more than a half-mile below the surface of the gulf is breaking down and how great a threat it poses to sea life.

Yet as the weeks pass, evidence is increasing that through a combination of luck (a fortunate shift in ocean currents that kept much of the oil away from shore) and ecological circumstance (the relatively warm waters that increased the breakdown rate of the oil), the gulf region appears to have escaped the direst predictions of the spring.

While its findings were disputed by some, the National Oceanic and Atmospheric Administration reported several weeks ago that the oil was breaking down and dispersing rapidly, probably limiting future damage from the spill.

And preliminary reports from scientists studying the effects on marshes, wildlife and the gulf itself suggest that the damage already done by the spill may also be significantly less than was feared — less, in fact, than the destruction from the much smaller Exxon Valdez spill in Alaska in 1989.

The scientists caution that much remains unknown, and that oil spills can have subtle effects that last for decades. Layers of oil are being found buried beneath the surface, both onshore and deep at sea. In blog posts from a research vessel in the gulf, Samantha Joye, a professor of marine sciences at the University of Georgia, reports that she observed a layer several centimeters thick on the sea floor, 16 miles from the wellhead, that she says was not a result of natural seepage.

But many scientists still say they are cautiously optimistic.

“Based on what I have seen so far, it could have been a lot worse,” said Lisa DiPinto, acting chief of NOAA’s marine debris division.

Perhaps no images evoked more heartbreak than those of the creatures inadvertently caught in the slick’s path: brown pelicans so covered with reddish oil that they could not lift their wings, sea turtles haplessly beached.

At the height of the spill, crates of birds arrived daily at a rehabilitation center in Fort Jackson, La.

Now the center is much quieter. On an August day, only about a dozen birds were brought in for rescue. But on the same day volunteers recovered more than twice as many dead birds, said Cathy Rezabeck, the spokeswoman for the Houma Joint Information Center run by BP and the government.

A similar pattern is being seen around the Gulf Coast, with the number of dead birds far exceeding the number of live ones being collected. Scientists attribute the rising death toll partly to the end of the nesting season — they can now go into the bird colonies to collect carcasses. They also believe fledglings have finally left the safety of their nests and are encountering residual oil.

Still, the numbers of oiled birds collected dead or alive — in the mid-7,000s as of Sept. 1 — is small compared with the avian toll of the Exxon Valdez. Carcasses of more than 35,000 birds were found immediately after that spill; 250,000 were believed to have died.

For the BP spill, said Melanie Driscoll, director of bird conservation for the Audubon’s Louisiana Coastal Initiative, “the final number will be in the thousands, not the tens of thousands.” Ms. Driscoll cited several reasons, including warmer temperatures, which make it easier for birds to regulate their body temperatures, and the inability of much of the oil to penetrate the marshes.

Assuming that the food chain remains healthy — and this remains a major question for scientists — even threatened birds like the brown pelican will come back, she said.

The spill also raised alarms about Kemp’s ridley sea turtles. Some 600 were stranded, more than seven times the usual number found from May to August, and 56 dead ones were collected, a majority with no visible signs of oil, suggesting they may have been killed by shrimpers. Rescuers scooped up hundreds of living, heavily oiled turtles from mats of sargassum seaweed where they congregate and feed.

Since mid-July, however, rescuers have found the sargassum mats not blackened but clean and teeming with food, and with them, turtles free of oil or so lightly oiled that they could be cleaned and released on the spot, said Dr. Brian Stacy, an NOAA veterinarian.

“I personally didn’t anticipate such a dramatic change so quickly,” he said.

Leland Hales, an environmental scientist inspecting marshy areas where oil had previously been seen, says much the same thing. Mr. Hales, who inspects previously oiled sites for BP, travels by boat to coordinates near Terrebonne Parish where his notes mention things like “10-by-10 yards oiled grass on the southeast” of an island of nesting terns.

In many cases, there is no longer anything to see. Oil has washed away, leaving grass that appears healthy. “I would have expected rapid die-off,” Mr. Hales said, “but that’s not what’s out there.”

The federal government estimated last month that half the oil leaked into the gulf had evaporated or otherwise been removed, leaving one quarter of it dissolved into tiny droplets and another quarter visible in forms like surface sheen and tar balls. The figures are controversial, and some scientists say they are vastly underestimated.

But according to NOAA’s figures, the BP spill oiled far less coastline than the Exxon Valdez spill. As of Aug. 31, NOAA had surveyed 1,796 miles of Louisiana coast and found 35 miles of shoreline to be heavily oiled, 71 miles to be moderately oiled and 115 miles to be lightly oiled. By contrast, the Exxon Valdez spill contaminated 1,300 miles of shoreline, about 200 miles of it heavily or moderately oiled, according to the Exxon Valdez Oil Spill Trustee Council.

Of the oil that did reach shore in the gulf, most has remained at the fringe of the dense marshes. That is largely good news for hundreds of thousands of acres of wilderness inside the fringe.

“The huge expanses of marshes that occur interiorly to the shoreline have been spared,” said Irving A. Mendelssohn, a professor of oceanography and coastal plant ecology at Louisiana State University.

Mr. Hales and other scientists say that even the oiled part of the marsh appears to be recovering.

Mark Kulp, an associate professor of coastal geology at the University of New Orleans, who also does research for a contractor for BP, says his observations of vegetation, from Spartina grasses to black mangrove forests, reveal a surprising rebirth. “There are places that I’ve seen where the stalks were laid over with oil and there is now new vegetation coming up through,” he said. “It is a pervasive thing.”

Marshes and wetlands are particularly sensitive to oil. If it enters the soil, it can kill grasses and their roots, leading to erosion. In some spills, including the Exxon Valdez, residual oil has been found in marshes decades later. Dr. Kulp suggests that will not be true for the gulf. “One thing working in our favor is the nature of the substrate,” he said, referring to the marsh bottom. “It is made dominantly of muddy sediment and is relatively impenetrable.”

Others are less sanguine. John W. Day Jr., a retired professor of oceanography and coastal sciences at Louisiana State, has worked with a private firm that developed a complex sensor for aerial detection of oil and gas. Its measurements show that plants in the marsh interior which appear healthy are, in fact, stressed and will probably soon die. Dr. DiPinto of NOAA is also concerned. She said that marsh creatures that dig burrows, like crabs, may eventually bring oil deeper into the soils.

And Wilma Subra, a chemist who provides technical assistance to the Louisiana Environmental Action Network and who has found substantial residual oil in marshes and estuaries near the mouth of the Mississippi River, the Atchafalaya River and Terrebonne Bay, said: “The government and BP continue to say it is very much improved out there, but there is still a lot of oil. Any fisherman could tell you that.”

Ms. Subra said the government needs to do more to assess the situation. “I am not saying their people in the field are not doing a good job, but there is a lot we are hearing about from fishermen and seeing ourselves that is not being investigated,” she said. “I’ve seen a lot of heavily oiled areas where the vegetation is not coming back.”

The spill’s greatest scientific challenge may be understanding how the oil is interacting with the undersea environment. The oil was released 5,000 feet beneath the water’s surface and then treated with an unprecedented volume of chemical dispersants. Some enormous fraction — how much is disputed — formed at least one great undersea plume of microscopic droplets.

Oil, which is toxic, poses a threat to wildlife, especially if continually ingested over time, though so far all seafood samples tested by the Food and Drug Administration have been ruled safe.

Still, scientists at Tulane University and the University of Southern Mississippi have reported finding tiny droplets of oil on blue crab larvae. The droplets have not been ingested but are lodged under the carapace, and seem to disappear when the larvae molt, said Harriet Perry, a biologist at Southern Mississippi. That suggests the droplets might affect animals that prey on the larvae more than the crabs themselves.

Scientists also worried that the plumes would severely deplete oxygen levels in the gulf because of a population explosion in oil-eating bacteria.

Low oxygen levels are already an acute concern. Every summer, agricultural runoff from the Mississippi stimulates the bacteria population, producing a “dead zone” the size of New Jersey, stretching from the mouth of the Mississippi River west to Galveston, Tex. The zone is so oxygen-depleted that it supports no life. Scientists, relying on data that did not include the oil spill, estimated in May that the zone would be somewhat larger this year.

But so far, there is little evidence of severe oxygen depletion outside the predicted zone. NOAA has taken more than 2,000 samples to measure oxygen levels, drawing water from the surface to the bottom within a radius of about 60 miles of the well site, said Steve Murawski, chief science adviser to NOAA’s National Marine Fisheries Program. They have found oxygen depression, but not levels too low to support fish, he said.

More recent findings, by Department of Energy scientists at the Lawrence Berkeley National Laboratory, suggest that the plume has already largely dispersed or degraded, though other scientists vigorously dispute that claim. The scientists at Lawrence were working under a grant from the EnergyBiosciences Institute at the University of California, Berkeley, which was financed several years ago by a 10-year, $500 million grant from BP.

Terry Hazen, a microbiologist and the head of the ecology department at the laboratory, said oxygen levels may have remained high because the droplets in the plume were so diffuse.

Dr. Hazen said a small part of him was disappointed that the plume had become undetectable, because it could no longer be studied.

“But that’s just the scientist in me,” he said. “The ecologist and environmentalist is glad that it’s gone — it was an ecological disaster.”

NEW YORK TIMES ARTICLE

Sept. 13, 2010, 6:13 p.m. EDT press release

ForestEthics: CEO of Royal Dutch Shell Confronted by Protestors During World Energy Congress

photo-credit: ForestEthics (click on photo to view high resolution image)

VANCOUVER, BRITISH COLUMBIA, Sep 13, 2010 (MARKETWIRE via COMTEX)

Before his keynote address today at the World Energy Congress in Montreal, CEO of global energy giant Royal Dutch Shell, Peter Voser was confronted by environmentalists to “get the Shell out” of Sacred Headwaters.

A brochure, mocked up as a Shell publication, was handed out to Voser and 1000 Congress attendees, ridiculing Shell’s activities to drill coalbed methane in the Sacred Headwaters.

“Shell cannot call themselves socially responsible when they have dismissed and undermined clear opposition from residents and communities in the Skeena, Nass, and Stikine watersheds,” said Shannon McPhail, Executive Director of Skeena Watershed Conservation Coalition.

For the rest of the release, please visit http://ow.ly/2DFzk

High resolution photo (credit to ForestEthics) http://ow.ly/2DFA5

Contacts:
ForestEthics
Claudia Li
Media Contact
604-331-6201 ext. 224

MarketWatch ARTICLE

* Says faster expansion in oil sands still possible

* Costs remain a concern

* Sees growing gas demand from emerging economies (In U.S. dollars)

MONTREAL, Quebec, Sept 13 (Reuters) – Royal Dutch Shell Plc (RDSa.L: Quote) could switch away from its slow-growth strategy in Canada’s oil sands but costs in the region remain a concern, the company’s chief executive said on Monday.

Shell, which operates the 155,000 barrel-per-day Athabasca oil sands mine and upgrader in northern Alberta, has nearly wrapped up a 100,000 bpd expansion of the project.

However it stepped back from plans for a further series of big expansions of its oil sands holdings after a squeezed labor pool in northern Alberta inflated construction costs and oil prices fell following the economic crisis.

Instead of big-ticket expansions, Shell Chief Executive Peter Voser steered the European oil major to smaller projects, looking to increase output in 30,000 bpd increments by tweaking operations at its two oil sands mines.

But Voser said that the alternative strategy of expanding oil sands output more and faster remains a possibility, though he’s uninterested in stoking further inflation.

“We left it open to go back to a more aggressive expansion if that is needed and if that actually is possible because of the costs,” Voser told reporters at the World Energy Congress in Montreal.

Chevron Corp (CVX.N: Quote) and Marathon Oil Corp (MRO.N: Quote) each hold a 20 percent stake in Shell’s Athabasca Oil Sands Project.

Voser was more optimistic about increasing production from the company’s natural gas operations, particularly its shale gas holdings in the Groundbirch region of northeastern British Columbia and the acreage in Pennsylvania’s Marcellus shale region that Shell acquired through its $4.7 billion purchase of East Resources Inc earlier this year.

Though some legislators and environmentalists are concerned that the techniques used to develop shale and other unconventional gas resources may threaten drinking water supplies, Voser said the company could safely produce its shale reserves.

“We comply with regulations and follow strict procedures to ensure that the process is safe,” he said in the text of his speech. “The natural gas we produce lies far below the fresh water layers. As a an extra protection measure we line the wells with steel barriers and concrete.”

Voser said the rise in shale gas production in North America frees up supplies of liquefied natural gas for other markets like China, Thailand, Singapore and Pakistan.

He expects economic growth in emerging markets to raise the demand for natural gas by 25 percent above current level of 110 trillion cubic feet annually by 2020 with much higher consumption of the fuel in China, the Middle East and North Africa. (Reporting by Scott Haggett; editing by Peter Galloway)

© Thomson Reuters 2010 All rights reserved

REUTERS ARTICLE

THE WALL STREET JOURNAL

By Jeff Fick and Diana Kinch Of DOW JONES NEWSWIRES

RIO DE JANEIRO (Dow Jones)–Plans by Anglo-Dutch oil giant Royal Dutch Shell (RDSA, RDSA.LN) to sell the company’s stakes in four offshore oil blocks in Brazil is part of a broader portfolio review, and not a reaction to new oil laws, the new president of Shell’s local unit told Dow Jones Newswires in an exclusive interview Monday.

Andre Araujo, who took over as president of Shell do Brasil three weeks ago, said on the sidelines of the Rio Oil & Gas 2010 conference that despite the sale, Brazil remains “strategic” for the company.

Shell’s stake sale represents one of the few opportunities global oil companies would have to enter Brazil’s offshore oil frontier, where no new exploration and production concessions have been put up for bid by the government since the presalt oil discoveries were made in 2007.

Shell put up for sale its participation in four blocks: BS-4, BM-S-8, BM-S-45 and BM-ES-28. In addition to Shell, Chevron (CVX), Petrobras (PBR, PETR4.BR), Petrogal (GALP.LS) and Vale (VALE) also own stakes in the blocks.

“We’re in the early stages of discussions,” Araujo said, adding that the blocks have generated a lot of interest since being put up for sale. But just because Shell is bailing out of some blocks doesn’t mean that the company isn’t focused on Brazil.

Shell plans to drill up to 10 new wells over the next 18 to 24 months, Araujo said. While Araujo wouldn’t not put a price tag on Shell’s future investments, the company has spent $3 billion in Brazil over the past 10 years, including $600 million in 2009.

The company is one of the few foreign oil producers in Brazil, pumping 110,000 barrels a day from areas it operates, including the BC-10 block’s Parque das Conchas field and Bijupira Salema. Parque das Conchas pumped first oil last year.

Shell is also interested in participating in new auctions of exploration and production concessions, including presalt fields under new production-sharing agreements. Officials from Brazil’s National Petroleum Agency, or ANP, said they expect to hold an 11th round oil auction early in 2011, with the first auction of presalt blocks under the new production-sharing regime also taking place in the first half of the year.

Earlier Monday, a Mines and Energy Ministry official said that the government-held Libra prospect would be included in the first presalt auction. In addition, the official said that Libra held recoverable reserves of between 7 billion and 8 billion barrels of oil equivalent-making it possibly the world’s largest oil find in the past 20 years.

“In principle, we’re interested in Libra,” Araujo said. “But we have to see how attractive the new regulation will be. Hopefully, the new regulation will be attractive.”

Araujo noted that Shell has participated in all of Brazil’s offshore auctioning rounds, except the fifth and ninth rounds.

The executive also highlighted Shell’s heavy investment in Brazil’s biofuels sector as an indication of Brazil’s relevance in the company’s portfolio. Earlier this year, Shell teamed with local sugar giant Cosan SA (CSAN3.BR) in a $12 billion biofuels joint venture.

“Shell can play a role close to the Brazilian government in working to make ethanol a global commodity,” Araujo said.

Brazil’s heavy use of ethanol as a key fuel is close to Shell’s development philosophy, Araujo said.

“It’s sustainable,” the executive noted.

-By Jeff Fick, Dow Jones Newswires; 55-21-2586-6085; jeff.fick@dowjones.com

WSJ SOURCE ARTICLE

(Docu – Ireland)

By JOHN ANDERSON

A Scannain Inbhear Teoranta presentation in association with Underground Films, Riverside Television and TG4 with the participation of the Irish Film Board. (International sales: Cinetic Media, New York.) Produced by Rachel Lysaght, Risteard O Domhnaill. Directed by Risteard O Domhnaill.

With: Pat O’Donnell, Maura Harrington, Willie Corduff, Mary Corduff.

What do people do, when the law prevents them from protecting themselves? That’s the question at the heart of “The Pipe,” a stirring, character-rich docu from Irish helmer Risteard O Domhnaill about Shell vs. Rossport, Ireland, where the oil company decided to run a gas line, and the community decided otherwise. The Irish don’t harbor a lot of affection toward things British, but those behind “The Pipe” might think fondly of BP, whose recent gulf disaster will add currency and urgency to this charismatic David-Goliath tale. Look for some theatrical gas and a secure on-air berth.

Tech credits are first-rate, especially O Domhnaill’s shooting, which ranges from action-thriller verite to meditative and painterly.

Camera (color, HD), O Domhnaill; editor, Nigel O’Regan; music, Stephen Rennicks, Hugh Drumm; sound, Barry Reid. Reviewed at Toronto Film Festival (Real to Reel), Sept. 9, 2010. Running time: 83 MIN.

Contact the Variety newsroom at news@variety.com.

SOURCE ARTICLE

http://www.thepipethefilm.com/

www.facebook.com/pages/The-Pipe-The-Film

THE WALL STREET JOURNAL

SEPTEMBER 13, 2010

By Angel Gonzalez and Mark Peters Of DOW JONES NEWSWIRES

MONTREAL (Dow Jones)–Natural gas, boosted by recent breakthroughs in its production and its relatively small carbon footprint, will play a prominent role in the world’s energy future, as long as global energy policies allow it to fill an increasing share of demand, Royal Dutch Shell PLC’s (RDSA, RDSB) Chief Executive Peter Voser said Monday.

“If we create space for natural gas to grow, natural gas will change the world’s energy landscape for the better,” Voser said at the World Energy Congress in Montreal.

The supply picture for natural gas has changed dramatically since North American companies figured out how to profitably exploit tight rock formations called “shales” in the last decade. Now the world has enough gas to keep producing for 250 years at the current rate, Voser said. Although the onslaught of supply, combined with the economic crisis’ damping effect on demand has depressed prices, the long-term appetite for the fuel “will keep pace with supplies,” Voser said, because of economic growth in emerging markets.

Shell believes that demand could rise by 50% to 165 trillion cubic feet per year by 2030, twice as fast as demand for crude oil.

Voser’s comments come as the unexpected rise of shale gas has disrupted the capital investment plans of many energy companies, which until recently thought that the trading of liquefied natural gas would be the key driver of the fossil fuel’s future, and expected North America to become a major consumer of LNG. The continent, however, won’t have the need for stable supplies of LNG “anytime soon,” he said, although there will be some room for the occasional cargo. Western Europe and Asia will drive LNG demand, in part because European shale gas output won’t take off before 2020 and because the rapid growth of natural gas demand in China and other emerging economies. China and other Asian countries are “keen to secure supplies through long-term contracts.”

The interplay between shale gas and LNG, however, is not a zero-sum game. The two “mutually reinforce” each other, giving greater confidence to investors that large supplies of natural gas are here to stay, Voser said.

Voser said the company takes seriously environmental concerns over the impact shale gas production may have on water supplies in North America, acknowledging that the last year has shown things can go wrong. The shale gas Shell produces lies in the ground well below water sources, and Shell is lining its wells with concrete and steel as a protective measure.

“We comply with regulations and follow strict procedures to ensure that the process is safe,” Voser said.

He added that government policies must help carve out a place for the growing supplies of natural gas. The creation of carbon emissions regulation that would create “robust” prices for carbon, or stricter emission standards for power plants to discourage the use of coal, would help spur demand for natural gas. Also, there are natural gas-fired plants in Europe and the U.S. that are being used at about 40% of their potential capacity; if their use can be ramped up, natural gas usage would rapidly increase, he said.

Voser added that governments should also help the energy industry develop new technologies to fight carbon emissions, particularly by backing carbon capture and sequestration projects. These projects are quite expensive and produce no revenue, making them difficult to finance.

At a press conference on the sidelines of the event, Voser said that North America, particularly Canada, could in the long term become a source of LNG for Asia. Exports from the U.S. could be difficult, as development of gas resources there has been so far geared to supplying the domestic market, but in “the very long run” such exports cannot be discounted, he said.

-By Angel Gonzalez, Dow Jones Newswires; 713-547-9214; angel.gonzalez@dowjones.com

SOURCE ARTICLE

13 September 2010

(AFP) MONTREAL — Prolonging the US government’s freeze on new deepwater oil drilling in the aftermath of the BP spill in the Gulf of Mexico could dent global oil supplies as early as 2015, Royal Dutch Shell said Monday.

US President Barack Obama’s order to block new deepwater drilling after a deadly explosion ripped through a BP-leased rig in April has only had a “rather small” effect on oil supply so far due to Saudi Arabia’s huge oil capacity, chief executive Peter Voser said.

However, he added, “if the moratorium would be prolonged, quite clearly you would start to see impacts on the supply from deep water, most probably (around) the time of 2015-2020 and the world needs to watch that.”

The moratorium is currently in effect through November 30.

After a court ruled against the six-month moratorium, the federal government issued a fresh ban on July 12 due to expire on November 30 to ensure oil companies implement safety measures in the wake of the worst maritime oil spill in history.

But local officials, lawmakers and oil industry workers said the move would cost hundreds of thousands of jobs for a regional economy already battered by the massive spill, which spilled 4.1 million gallons of crude into the water.

And oil firms with extensive operations in the Gulf of Mexico warned of an exodus if the drilling remains suspended.

Speaking at the 21st World Energy Congress in Montreal, which runs through Thursday with the participation of 5,000 energy industry representatives, Voser said natural gas could be a future solution to the reduction in oil supplies and the growing energy needs.

“Natural gas, as the cleanest-burning fossil fuel, will play a prominent role in decades to come,” he said. “It has the potential to alter the energy landscape for the world as a whole.”

Voser said natural gas could satisfy growing energy needs worldwide while maintaining a healthy supply that could feed the market for 250 years.

By 2020, global demand for natural gas is due to grow by 25 percent, before jumping to 50 percent by 2030, according to the Shell chief.

Copyright © 2010 AFP. All rights reserved

SOURCE ARTICLE

“..BP threw a lot of money away by trying to drill that well ‘on the cheap’. One now has to wonder how Shell plans to drill their wells in the Arctic given the very ‘cheap’ drilling rig they are using.”

COMMENT ON THE BP/TRAN OCEAN DISASTER BY A FORMER SHELL EMPLOYEE

I have worked in the oil industry for several decades and have worked on many dozens of exploration wells, domestic US and overseas. Shallow wells, deep wells, straight hole and deviated, normally pressured and geopressured. So, I have been there and done that.

I have noticed in many articles and commentaries that Halliburton has come in for some serious pummeling for the design of the cement job for that particular well. Questions have been raised about whether they used the appropriate type of cement, and whether the proper number of stabilizers were attached to the casing, etc. And then there has been mention of the fact that BP did not run a cement bond log afterwards to determine the quality of the cement job.

I have however, seen no mention what-so-ever of the condition of the uncased borehole prior to the running of the casing and the cementing of that casing. It may well have been that the condition of the borehole was so bad that it was not possible to get a reliable cement job on the casing.

By ‘bad borehole’ I mean that it was badly washed out. Instead of being a nice round hole in the ground it was a very ratty and ragged affair where the diameter of the borehole varied widely up and down the open hole section. A ragged, ratty, washed out borehole almost always precludes obtaining a good cement job.

What causes borehole washout problems? Some times they are related to the type of rock through which you are drilling, such as unconsolidated shales or salt. But most of the time they are related to the way the well was drilled. The longer a borehole is open the rattier it gets. A poor mud program, designed to cut drilling expenses, is often the culprit.

In most large oil companies engineering duties for exploration and production wells are split into various sub-specialties. There are drilling engineers who specialized in designing drilling programs for well, there are production or completion engineers who take over from the drilling engineers after a well has been cased and cemented. And there are evaluation engineers who specialized in evaluation the various rock formations that a well has penetrated to determine if hydrocarbons are present or not.

The objective of the drilling engineers and drilling operations folks are often very much at odds with what is needed and required by the evaluation and completion engineers. Drilling engineers want to punch a hole down to the objective as quickly and cheaply as possible. Evaluation and completion issues associated with poor borehole conditions are not their problems. Evaluation and completion engineers want a borehole that is in as good condition as possible, i.e., that is not washed out. These people are always at odds with each other over how a well is to be drilled, and the resulting drilling program is always a compromise.

If engineering management and leadership is good then the drilling program is designed to meet the needs of the evaluation and completion engineers for an exploration well. If it is not, and they are too focused on ‘saving money’, then the resulting well will often be in poor condition making evaluation difficult at best, and in some cases impossible. Completing a well with a bad borehole can be very challenging as well, particularly if there are multiple zones to test. If the well bore is in bad condition the cement job is usually ineffective and it is not possible to isolate productive zones because the hydrocarbons can flow between the casing and the borehole.

From what little I have read and heard about the BP incident it would appear that no matter what Halliburton may or may not have done, it may not have been possible to get a good cement job on that well. That would allow hydrocarbons to migrate upward between the casing and the well bore.

While Transocean was responsible for drilling the well and rig operations, BP was responsible for the design of the drilling, evaluation, and completion program, and the execution of those programs.

From what little information I have seen I suspect the real culprit behind the BP fiasco was poor well design, and a poorly designed drilling program designed to save as much money as possible. That coupled with all the other mistakes, then led to the disaster. At $500,000/day, or there abouts, that drilling rig was not cheap. But BP threw a lot of money away by trying to drill that well ‘on the cheap’.

One now has to wonder how Shell plans to drill their wells in the Arctic given the very ‘cheap’ drilling rig they are using.

“Given the enormous power wielded by this behemoth [Shell] in the case of Ireland, at any rate, a whistleblowers’ charter is essential if a modicum of trust is to be generated between the industry and the state establishment on one side and the citizen on the other”

The Mayo News

Tuesday, 07 September 2010

CORRIB GAS ORAL HEARING – WEEK TWO
A divided community
Aine Ryan
NEWS REPORTER

TENSIONS are palpable as the Bord Pleanála oral hearing into Shell E&P Ireland’s application for the last section of the Corrib high-pressure gas pipeline continues. Here, The Mayo News provides exclusive coverage of the complex issues that last week led board Inspector Martin Nolan to remark on the “significant social issues and tensions involved”, and, moreover, make a commitment to allow time to address these matters later during the hearing.

THE PARISH PRIESTS
A NORTH Mayo priest has strongly defended ‘the human rights’ of his parishioners some of whom he claims ‘cannot sleep at night’ due to ‘the turmoil’ they have been exposed to because of the ongoing Corrib gas controversy.

The Parish Priest of Kilcommon, Father Michael Nallen was the second priest to address the Bord Pleanála hearing into the controversial project.

On Wednesday last, his diocesan colleague, Father Kevin Hegarty, who ministers in Kilmore-Erris, said this project was ‘arguably’ the most forensically examined project in the 88-year history of the State.

Heckled at one stage during his delivery, Father Hegarty said: “I believe that Shell has sought to fulfill the requirements of Irish, European and international environmental laws in its planning, construction to date and proposed operation of the development.”

Noting the project’s strategic importance for Erris, Mayo and Ireland he said: “I also believe that, particularly from late 2005 onwards, the company has shown a willingness to be a good neighbour and contribute positively to the community.”

Father Hegarty also said he believed the vast majority of the Erris community supported the  development.

“I know there are sincere people among the protestors. I believe, however, their fears about the safety of the pipeline have been grossly inflated by the sulphurous rhetoric of those

who wish to prevent the delivery of the gas on ideological grounds. I also sense that some of those opposed to the development abhor the extreme tactics of a minority of their group.”

He cited  the supervisory and statutory roles of such  government agencies as An Bord Pleanála and the Environmental Protection Agency.

“The main thing that gives me confidence about the human and the environmental safety of the Corrib gas development is that there are stringent Irish, European Union and international laws and directives governing planning applications.”

Addressing the hearing on the following day (Thursday, September 2), Father Michael Nallen  accused the Minister for the Environment, John Gormley of using one rule for his own constituency in south Dublin and another for the remote community, in Kilcommon Parish, where he ministers.

Father Nallen said: “Just because we are not living in John Gormley’s constituency does not mean we don’t have human rights. The Green Party seems more concerned with the rights of animals and frogs than with people.”

He was referring to the fact that Mr Gormley issued a Foreshore License to Shell within four months for ongoing boreholing work in Sruwaddacon Bay and is still stalling after two years regarding a license for the controversial incinerator in Ringsend.

“I am conscious of the political background to this project but the people of Rossport and Aughoose  have the same rights as the people living on the east coast,” Father Nallen said.

He observed that himself, and the other two priests, who minister in the parish, are concerned about issues of ‘social justice ‘and human rights’.

“We would have ethical concerns about the level of compensation being offered to fishermen and clubs and organsiations, many of which are not in the hazard zone of this project.”

He continued: “As a parish priest I am privy to the fears, worries, tensions between neighbours because of this project. People are not able to sleep at night because of the level of exposure to turmoil.”

The resumed planning appeals board hearing is under the remit of the Strategic Infrastructure Act and will deliberate on a revised application by Shell, which involves tunnelling a section of the pipeline route under the Sruwaddacon estuary, a Special Area of Conservation (SAC). It will also examine Compulsory Acquisition Orders (CAOs) by Shell for access to lands along this newly modified route, the third proposed by the developer.

THE PSYCHOLOGIST
A RETIRED Department of Education Psychologist criticised Shell’s public relations strategy of targeting schools ‘with baubles and trinkets’ during Thursday’s hearing. He claimed the company ‘was manipulating the community in a shameless way in order to achieve their own ends’.

Educational Psychologist, Tom McAndrew, a native of Erris, said: “Shell is well aware that their Corrib project has split and divided this community in terms of support or opposition. Not only is the community divided, but also families and staff within schools.”

He observed it was hard to blame schools and boards of management – desperately short of funds – for being tempted by such obvious generosity.

“Principals and Boards of Management were placed in an invidious position and under pressure from some of their parents to engage with Shell,” he continued. Mr McAndrew suggested this caused ‘psychological pressure’ and ‘occasional strife between some students’ caught up in the tension caused by community and familial divisions.

He said the Shell project ‘has destroyed much of the social capital of this community’.

“I wonder, when all of this is over, if Shell will produce one last cheque to run the mediation courses that will be necessary for this sundered community,” he concluded.

Responding, Esmonde Keane, Senior Counsel for Shell, said he ‘absolutely rejected that it was manipulating the community’. He argued the company’s various grants and schemes were established to ‘give back to the community’ and cited Independent Mediator, Peter Cassells’ recommendation for community investment.

Afterwards, members of the Board of Management of Pullathomas National School made a brief submission about their  concerns in relation to the pipeline route, which runs in close proximity to the school.

They sought a ‘guarantee for the future health and safety of those using the school and the playing fields’.

BUSINESS GROUPS
IN a submission in favour of the project by the Regional Director West of business lobby group, IBEC, John Brennan said there would be 130 permanent jobs when the Corrib gas refinery – which will operate 24 hours a day – is operational.

Mr Brennan observed that towns in the west were already benefiting from the supply of natural gas because of infrastructural development, in relation to the project.

“We are highly dependent on imported fossil fuels and need to develop our own fields and hence the requirement to proceed with the delivery of the Corrib gas,” he said.

Referring to the delay in its delivery, Mr Brennan said: “This project is several years behind schedule, for a variety of reasons, and this could damage Ireland’s international reputation regarding foreign direct investment, including by energy companies.”

Speaking on behalf of local suppliers and contractors, Brendan Hegarty said he, and the other businesses he represented, had ‘found Shell to be an excellent organisation to work with and that the company places ‘a strong emphasis on safety all the time’.

“The wider community in which we and our staff live has also benefited enormously from this project. As a result of the significant up-skilling and retraining of local staff … Erris now has a strong, skilled and professional workforce readymade for any future projects or industries that might develop in this area,” Brendan Hegarty said.

Meanwhile, the Managing Director of Coláiste Uisce and Chairman of community group, Pobal le Chéile Ciarán O’Murchu ‘in the interest of public safety’ called on the planning appeals board to ‘seek an independent review of all the separate elements of this project to include the overall plan of development prior to making its decision on the onshore pipeline’.

“As you are aware Mr Chairman there have been many accusations of political interference in relation to this development.  I do not intend to rehash these arguments, however, it should be noted that since the last oral hearing, more information supporting these claims has come to light,” Ciaran Ó Murchú observed.

POBAL CHILL CHOMÁÍN
FORMER Bord Gáis engineer, Leo Corcoran, made a presentation on behalf of local community group, Pobal Chill Chomáin.  In his submission, he argued that the Land Valve Installation (LVI) at Glengad – the site of major clashes last year – was in an inappropriate location.

“The site at Glengad does not meet the risk criteria by An Bord Pleanála as outlined in the Board’s letter of 2nd November 2009,” Mr Corcoran said. He was referring to a letter in which the board deemed almost half the then proposed pipeline as ‘unacceptable’ on safety grounds.

He said the QRA (Quantified risk Analysis) in the current EIS (Environmental Impact Statement) ‘does not include the analysis requested by the board’.

“Had this analysis been carried out it is most likely the site at Glengad would fail the risk thresholds set by An Bord Pleanála,” he said.

He also argued that government agencies and ministers with the  powers and duties to regulate this project failed to ensure that international best practise applied.

“The developers current solution of boring a 4.2 metre tunnel to accommodate a 0.5 meter pipe would never have got beyond the stage if this was proposed in 1999,” Mr Corcoran said.

LOCAL RESIDENTS
ROSSPORT FIVE’s Micheál Ó Seighin called for the establishment of a Whistleblowers’ Charter.

“Given the enormous power wielded by this behemoth [Shell] in the case of Ireland, at any rate, a whistleblowers’ charter is essential if a modicum of trust is to be generated between the industry and the state establishment on one side and the citizen on the other,” Micheál Ó Seighin said.

He observed that: “The Deepwater Horizon debacle has put paid to any suggestion that risk equations make anything safe; that the hydrocarbon industry is anything but dangerous for workers or for other people who come in proximity to it; that a structure can’t fail; and more and more, that procedures dependent on a perfect workforce are anything other than window dressing, because people do as people are.”

Local resident, Jarlath McAndrew sought clarification about the fact that Shell route consultants, RPS said three years ago ‘the pipeline could not come up the bay (Sruwaddacon, the newly proposed partial route] as it would be in close proximity to the school, church, graveyards and public house where people congregate’.

Referring to comments about objectors made in a submission by Father Kevin Hegarty, whose parish is around 12 miles from the project, Mr McAndrew said: “ [We] are not anarchists or blind people looking for a black cat in a dark room that’s not there, we are ordinary people trying to live ordinary lives in extraordinary circumstances, while trying to protect our families, our environment and our community. Unfortunately, being a real neighbour of Shell is not quite as glamorous as it appears to people who are far removed from the situation.”

Meanwhile, Solicitor, Paul Brennan, made a submission on behalf of local farmer and postman, John Barrett whose home ‘was almost destroyed’ during the devastating 2003 landslide on Dooncarton mountain.

“The [Barrett] family has already had to suffer the heartache and trauma that resulted from the significant landslide that almost destroyed his property in 2003. The scars from the landslide are still visible. The family is concerned that the pipeline tunnels [proposed under nearby Sruwaddacon Bay] and other works close to their home could cause further landlslides during the construction stage and into the future,” Mr Brennan said.

BELMULLET GAA
SUPPORTING the project on behalf of Belmullet GAA , John Gallagher,  chairman, argued that the stringency applied by Shell in its funding schemes challenged the veracity of any notion that the company had tried to buy the support of local organisations.

“We, in Belmullet GAA Club … draw our membership and players from a population base of 4,000 and field teams from Under-8 through to senior. Belmullet GAA’s decision to support the Corrib project has been discussed at club meetings over the past four years and has received unanimous backing and support at all times.”

MAURA HARRINGTON AND SHELL TO SEA
HIGHLIGHTING the national economic crisis in the context of the project, Ms Harrington observed: “There is nothing strategic about the application other than for the private shareholders of RDS plc, Vermillion Inc and the citizens of the Norwegian state. A 25 to 40 per cent of Corporation Tax as a sole hydrocarbon tax cannot by any stretch of credulity be deemed to address the common good. This country is in a state of chassis and will remain so for the foreseeable future yet the last prime asset which should be within the control and management of the state is ceded to foreign oil companies.”

She submitted a copy of the Marine Institute’s map, called, The Real Map of Ireland’ showing the currently designated Irish continental shelf.

“The application before the board is designed to get a conduit for the plunder of Irish oil and gas thought Sruwaddacon by devious use/abuse of process. … The long term purpose of the oil companies is that the Ballinaboy refinery would be the hub for export of most if not all oil and gas from the  Atlantic Ridge thereby becoming the other end of a long transmission network.”

The hearing continues this week.

SOURCE ARTICLE