Oil Rig Explodes Off the Coast of Louisiana

Oil rig explodes near the site of the failed Macondo well off the coast of Louisiana

By Nicholas Moroni

The Associated Press reported a short time ago today that an offshore petroleum platform exploded 80 miles off the coast of Vermillion Bay - not far from the site of the failed Macondo well, which leaked into the gulf's waters for three months.

Information at this point is limited. Residents in and around Vermillion Parish claim that little can be seen at this time.

"We think it's a production platform," said a representative from the Vermillion Parish Tourist Commission, reinforcing the AP report. The representative asked to be quoted anonymously.

"We don't see any smoke trails. All I know is what I've seen on the news," said Steve Chevalier, a hotel owner in nearby Grand Isle.

AP, reporting on a Coast Guard briefing, stated that Coast Guard Petty Officer Casey Ranel said the blast was reported by private helicopter company this morning.

The exploded rig was in roughly 350 feet of water, according to the Department of Homeland Security; while the Deepwater Horizon was submerged 5,000 feet at the time when it burst into flames.

All 13 workers aboard the rig have been accounted for, with only 1 injury, The Times-Picayune reported.

Relief Well, Bottom Kill, Static Kill, What?

A caricature made in protest of the

spill in the Gulf of Mexico along Louisiana

Highway 1, in Lafourche, La.

(Photo by Nicholas Moroni)

Due to the gulf spill, industry terminology is now part of the public discourse; but, what does "bottom kill" mean?

By Nicholas Moroni

Four months after the disastrous explosion of the Deepwater Horizon oil rig in Gulf of Mexico waters off the coast of Louisiana - one that led to a failed oil well that was only recently tamed - both BP and the federal response have supplemented news coverage of the oil spill with a slew of industry terminology. But, what is the difference between a "static kill" and "bottom kill?" And, didn't they already try the latter? No, that was the failed "top kill" method."

Provided below is a list of some of the methodologies employed in the wake of the spill, concise definitions, and whether or not they were successful in stanching the 4.9 billion gallons of crude that gushed into the gulf between April 20 and July 15.

• COREXIT Dispersants - The federal government allowed BP to spray between 1 and 2 million gallons of chemical dispersants from the company COREXIT (COREXIT 9500 and COREXIT 9527). The use of the product is controversial because the effects of its chemical compounds are largely unknown. The EDF cites a study that claims the dispersants do have levels of toxicity; while the EPA has offered a classification of "non-toxic". A company spokesperson claimed the dispersants largely comprise "detergents." (A fisherman in Cut Off, La., near the Gulf of Mexico, told this reporter that a friend of his that had been hired by BP to lay booms and spot oil had been exposed to the dispersants. Toxins in COREXIT allegedly poisoned the man's bloodstream. The fisherman, who at the time was receiving emergency payments from BP, asked that his name not be disclosed, because he claimed "it was in his contract" with BP not to speak negatively about the company. "I can't say what I want to say," he muttered.) The federal government claims that 75 percent of the oil at water level has dissipated, largely due to the use of dispersants.
• Cofferdam - A dome intended to collect the leaking oil. The effort failed after icy, crystallized gas blocked pipes in the structure, preventing it from garnering the gushing oil.
• Top Kill - BP attempted to stop the oil by pumping mud down the well from the top. Because of the high pressure of the gushing well, this effort was unsuccessful.
• Junk Shot - After the Top Kill effort failed, BP attempted to shoot debris such as shredded rubber tires and golf balls down the well. The plan was then to pump mud and cement down the well to seal it once the oil was stopped, or the pressure quelled by the "junk." This too was futile.
• Static Kill - Similar to top kill; it's only "static" because the oil leaking into the gulf had been halted after a cap was placed upon the failed blowout preventer (the device that is supposed to seal the well in the event that it malfunctions) in July. The static kill might have been successful in plugging the well because the mud that was flushed down the well did not have to contend with an out-of-control well.
• Relief Well - There are two wells in the general proximity of the failed Macondo well that, if all goes according to plan, when the weather in the gulf improves this week, and operations continue, will diagonally intercept the flow of oil from the once-gushing well.
• Bottom Kill - BP and government response teams have hailed this tactic as a silver bullet ever since announcing the drilling of relief wells in June. The process entails pumping mud and cement into the well's sides through the diagonally drilled relief wells. The bottom kill occurs subsequent to the interceptions from the relief well.
• Gentle Tug - This week BP will also attempt to remove the original blowout preventer that failed and caused the April 20 explosion, as well as the cap stack that was placed atop it in mid July to reduce the amount of oil leaking out of the well.

Real Estate Agents in Gulf States Hit by Oil Spill Lobby for Cash

(Twitpic by BourbonRealty)

Real estate representatives from the gulf region secure $68 million in financial reparations for losses in sales they attribute to the oil spill

By Nicholas Moroni

Recognizing the adverse financial impact that the BP oil spill has had on the real estate industry in the gulf region, several industry representatives from five states in the area recently flew to Washington, D.C. and successfully lobbied for $68 million of BP's $20 billion escrow fund, The Daily Comet, a local newspaper in Lafourche, La., reported on Sunday.

According to the article, real estate agents motivated by a post-spill sales abatement, decided to make certain that they would be compensated through BP's escrow fund, which is being adminsitered by Washington attorney Ken Feinberg's Gulf Coast Claims Facility. The piece also states that a driving force in the decision to pursue lobbying was a shared concern that the real estate industry would not be provided for under the auspices of the Oil Pollution Act of 1990, which guides for the GCCF protocol - either through the GCCF or through litigation.

"If realtors were to sue BP under the Oil Pollution Act, they would not be awarded any funds," Malcom Young, CEO of Louisiana Realtors, told The Comet.

It should be noted though, that under OPA, spill victims with legitimate claims are to have their losses accomodated, with the possibility of interest, by the responsible party - in this case, BP, however, the fund will not accomodate moratorium-related losses.

Realtors are saying that buyers are backing out because of lack of capital due to a job shortage that now permeates the region as a result of the drilling moratorium, while out-of-town lenders are skeptical to loan to oil industry employees that could be out of jobs and default on payments. The region is heavily dependent on the oil industry.

Finally, the article cites a study by the research group CoreLogic which estimates that the gulf region could lose up to $648 in homes sales this year, and as much as $3 billion over five years.

Gulf of Mexico Well Sealing Stalled by Bad Weather

Bad weather stalls the plugging of the failed well in the Gulf of Mexico

By Nicholas Moroni

Poor weather conditions in the Gulf of Mexico prevented an operation to plug the failed well that resulted in the months-long oil spill in the gulf region, The Associated Press reported today.

The AP article cited a phone conference delivered this morning by retired Coast Guard Adm. Thad Allen (the federal go-to-man for the spill response effort) to a group of reporters, in which he said that waves "six to eight feet high" in waters off the coast of Louisiana pose too great a risk for BP engineers and rig workers that would attempt to remove the failed blowout preventer and replace it with a new one. The blowout preventer was supposed to seal the well, when a surge of natural gas mixed with oil in the well's pipeline causing the deadly explosion of the Deepwater Horizon on April 20.

A temporary cap that was applied in July to collect oil through a pipeline that lead to several vessels - one that was loosely fitted and failed to permanently seal the leak at the time - will also be removed.

The response team will then apply a new cap, and connect it to a relief well that is still a work in progress. 50 feet of drilling still needs to take place to complete that well, but after that scientists will pump cement and mud into the well to permanently seal the well.

In July, BP successfully halted the flow of oil into the gulf after an 86 days of an out-of-control gusher. An estimated 4.9 billion barrels (around 206 gallons) of oil leaked into the gulf waters througout that time.

Allen said operations will resume in two to three days.

Gulf Oil Spill Hearings: Disorder Aboard the Deepwater Horizon

Gulf of Mexico oil spill hearings reveal little about the explosion on the Deepwater Horizon oil rig; A Wall Street Journal report discloses a haphazard operation aboard the rig prior to its explosion

By Nicholas Moroni

Whether additional measures could have been taken to prevent the explosion of the Deepwater Horizon oil rig was the central topic throughout federal investigative hearings in Houston this week.

All week, a joint panel hosted by the US Coast Guard and the Interior Department's Bureau of Ocean Energy Management, Regulation and Enforcement scrutinzed - and discovered little - the actions of a number of players with connections to the doomed rig.

Throughout this past week, representatives from BP, Transocean (the Swiss countractor that leased the Deepwater to BP), and other companies largely dodged questions and played a blame game, while five witnesses invoked their Fifth Amendment rights, and refused to testify.

The Washington Post reported last week on the testmony of Transocean's Paul Johnson, who accused BP of swapping a more experienced well-site leader for one the oil giant favored - albeit one with less experience. However, The Wall Street Journal cited a counterattack by BP, stating: "BP has said that Transocean bears at least partial responsibility...because of the equipment's failure."

That "equipment" would be the blowout preventer - the device that seals off a well in the event of an explosion. In the case of the Macondo well, the blowout preventer failed to do so.

Another recent article in The Journal also paints a portrait of disorder and disconcern with regard to a crucial test to the failed Macondo well in the days leading up to the Deepwater's demise, and the 86 days of crude that gushed into the Gulf of Mexico. According to the article, which sites investigative records, and the testimonies of witnesses from this week's hearings, several officials aboard the Deepwater allegedly failed to seriously assess unusually high pressure readings. The readings needed to be taken prior to a test that would enable the rig to make sure that cement and steel inside the well were locked together. The cement and steel had to bind together to prevent any natural gas from leaking, so the rig could depart the site and move on to another job.

Robert Kaluza, a BP well site leader, who declined to testify this week, told BP internal investigators that decisions made by some of the company's officials may have been done in an effort to expedite the process. "Maybe [they] were trying to save time." BP has also been accused of having economic incentives - moving forward in an attempt to pursue other drilling projects.

The article also states that an unusual amount of mud was removed (ten times the usual amunt) below the blowout preventer - possibly to drill deeper. Mud holds down any gas that may leak, so wells are usually tested before they are utilized.

In this case, the excessive amount of mud removed may have caused the potent mixture of natural gas and oil to surge up a the well and set the rig ablaze. What's more, the faulty blowout preventer failed to seal the well and prevent the dangerous concotion from rising to the top.

The well was also referred to by BP employees as the "nightmare well," prior to the explosion.

As for the federal joint hearings - they will resume on October 4 in either New Orleans or Houston.

Transocean Operatives Tesitfy at Federal Hearing

Deepwater Horizon oil rig following the April 20 explosion that led to

the oil spill in the Gulf of Mexico. Transocean leased the rig to BP and

Halliburton was responsible for the cement job in the well

that some have called the cause of the blowout.

(Photo by US Coast Guard/Courtesy of SkyTruth)

US Coast Guard and Bureau of Energy Management hearings in Houston illuminate a kerfuffled Deepwater Horizon rig

By Nicholas Moroni

The joint US Coast Guard/Bureau of Energy Management federal hearings into the ongoing oil saga in the gulf continue today in Houston; however, yesterday's session was marred with a self-inflicted portrayal of disorganization among the leaders aboard the ill-fated Deepwater Horizon oil rig - which sank on April 20, killing 11 crew members.

Transocean - the company that leased the rig to BP - operatives were on the hot seat yesteday as federal officials pushed to reveal a lack of communication and organization that in no way facilitated the crew's response to the blown-out well. When US Coast Guard Capt. Hung Nguyen asked rig manager Paul Johnson matter-of-factly, "Are you clear who was in charge?"; Johnson replied, "I'm not sure."

The Los Angeles Times also reported that after the blowout, crew members were awaiting orders from senior personnel - orders they never received.

Daun Winslow, a Transocean division manager, claimed that Curt Kuchta, the rig's captain, turned to him to inquire as to whether or not he should perfrom an emergency disconnect of the drill from the well. Winslow also said he had to urge Kuchta to deploy the lifeboats.

The LA Times also published a series of troubling findings from a September 2009 audit of the rig that were summoned at yesterday's hearings - among them:

• Not all relevant personnel on the rig were knowledgeable about drilling and well operation practices.
• A review showed significant overdue maintenance jobs that required more than 3,545 man hours.
• No single person on board could account for which alarms had been disabled and for what reason.
• A warning on understaffing was issued saying that any further reduction of experienced personnel may be "detrimental to the performance of the rig."

The hearings proceed today, with BP and Haliburton representatives being called to testify, although the Houston Chronicle reported yesterday that Brian Morel, a BP drilling engineer, plans to exercise his Fifth Amendment rights by refusing to say anything that might incriminate him in any wrong-doing.

One of the Halliburton employees expected to testify today was supposedly in direct contact with Morel and other BP representatives about the cement job in the weeks leading up to the well explosion. A faulty cement job by Halliburton may have caused the explosion: if the cement is not properly set in a well, oil and gas can mix and surge up the well at extremely high rates of speed, causing an explosive force.

As the federal hearings continue, and perhaps the finger-pointing, the question of whether or not these companies and other BP associates will be shielded under claimants' agreements to waive litigation following a settlement with attorney Ken Feinberg's Gulf Coast Claims Facility - something Feinberg is still pondering.

Gulf Coast Claims Facility Criticized

Ken Feinberg (Photo by Bill Starling/

Courtesy of Press-Register)

Ken Feinberg's Gulf Coast Claims Facility receives criticism in its earliest stages

By Nicholas Moroni

Ken Feinberg's Gulf Claims Facility began officially evaluating the claims of alleged spill victims amid a choir of criticism. In the days preceding the transition, Attorneys General from Florida, Louisiana and Mississippi have all offered up their qualms with the manner in which Feinberg will apparently determine the legitimacy of claims.

Feinberg has maintained that proximity to the spill will be a major factor - a cause for concern for residents in regions further away from the shoreline, who claim the spill's effects were still largely felt. In Florida, where oil did show up along the shoreline, tourism in the state has reportedly taken a nosedive, which some credit to the general region's image. Feinberg has stated that stigmatization is not legitimate cause for compensation.

"We've got a proposed geographic map along the Gulf Coast that gives us some flexibility of how we will define proximity," the Washington attorney recently told The Palm Beach Post. However, The Wall Street Journal reported today that Florida Attorney General Bill McCollum said there is more stringency to Feinberg's loosely defined protocol than is found in the Oil Pollution Act of 1990. He called Feinberg's described methods "completely unacceptable."

Claimants, the attorneys general, and elected individuals have taken issue with Feinberg's ill-deifined position on the responsibilty of business associates of BP. Uncertainty as to whether these companies can be sued following a final settlement, and the deduction of any money paid to fisherman that participated in BP's Vessel of Opportunity clean-up routine, are controverstial topics.

"Mr. Feinberg appears to be completely tone-deaf to the concerns of people along the Gulf Coast," Alabama Attorney General Troy King told The Journal.

Feinberg at this time is mending the protocol he released last week, so all of the evaluation process is subject to change.

To his critics, if litigation is a better options, he advises them to "go ahead."