Tuesday, July 20, 2010

The Deep-Water Drilling Moratorium

Documents prepared by the oil industry as environmental assessments for oil leases in deepwater show that blowout preventers have a predicted failure rate of 28 percent. Experience with blowout preventer malfunction on Deepwater Horizon and in numerous other cases bears this out. Conversations with working drillers indicate that the occurrence of well blowouts and near blowouts is much more frequent than generally reported. The willingness of big oil companies and workers to take these risks for big financial rewards does not mean that the rest of us should be willing to accept the same risks to devastation of our coastal waters and those portions of our economy and culture that depend on them. The drilling moratorium is a reasonable response by government to the BP oil disaster because many other deep water rigs are using the same technology that failed with Deepwater Horizon.

It is high time to evaluate the risks and our legal, regulatory and technical mechanisms for controlling that risk. The negative impact on local jobs is an unfortunate but unavoidable outcome to the necessary reassessment of the escalating risks of offshore oil development in deep water. Assumption by the oil industry of full financial responsibility in all cases would help to limit risk taking behavior and would encourage industry investment in safety technology. That is not the current situation. Currently the oil industry enjoys limits to its financial risk through a congressionally authorized $75 million cap on liability. So the taxpayers can be left holding the bag for substantial cleanup costs from large incidents. The taxpayers certainly have a right to regulatory control if they are expected to pay numerous and substantial tax subsidies for oil exploration and development as well as assume risk for cleanup costs. Indeed the failure of BP to invest in adequate technical capability to immediately stop the flow of oil from a deepwater incident clearly shows the need for more thorough government oversight and for greatly increased industry investment in safety.

This does not mean that we shouldn’t seek a timely conclusion or adjustment to the drilling moratorium. Louisiana jobs and the families they support are important to the economic health of our region. Unfortunately they have been caught up in a spiral of unchecked increase in risk for financial return. We think it is important to find a balance of financial liability and regulatory oversight that represents the interest of the taxpayers in protecting our coastal economy, cultures and environment from future oil disasters.

Haywood (Woody) Martin, Chair, Sierra Club Delta Chapter

1 comment:

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