Wednesday, May 19, 2010

Drill Baby Drill? But What's the Real Cost of Off-Shore Drilling?

It is absurd to call what‘s happening in the Gulf of Mexico as a result of the explosion and collapse of BP’s Deepwater Horizon drilling rig an “oil spill.” This is no spill. It is an oil gusher. This mess is destined to make the Exxon Valdeze oil spill of 1989 pale in comparison. And in case you’ve forgotten about that mess, people can dig down a foot or so on the Alaska shore in the spill’s vicinity and still find oil. What did we learn from that environmental disaster? Evidently, not so much.


If any of you witnessed the Congressional hearing featuring See No Evil, Hear No Evil, and Speak No Evil from BP, Transocean, and Halliburton, you didn’t miss anything if you were looking for answers. Those CEO’s sounded like my kids when they were all younger. “It wasn’t me. He did it.” “I didn’t do it. He did.” It was disgusting. I, for one, am sick and tired of seeing well-heeled CEO’s from this industry or Goldman Sachs and the rest of the banking mess’s cohorts sit at a hearing and say, “It wasn’t my fault. And besides, stuff happens.” It makes me want to run screaming into the wilderness.


On May 3, it was reported that at least 2,500 square miles of ocean was covered in this oil, and it is not getting any smaller since it continues to flood out thousands of barrels a day. Yesterday, a BP spokesman reported that the new siphon hose was working. Well whoopee! He said they were able to capture about 1000 barrels a day. How lovely since at least 50,000 barrels are gushing out into the Gulf each and every day. I suppose it is nice to know a siphon hose works better than a huge dome or a flipping top hat. But hey, the junk shot may work. Really? It sounds like third graders are in a room, brainstorming how one might stop up an underwater oil volcano. And besides, BP’s CEO announced that he was sure that the “environmental impact will be very, very modest ” (05/19/2010 on BBC news). When this same company wanted to do this deep-water drilling in the Gulf in the first place, BP assured all officials that they knew how to prevent any possible damages from such drilling, and that they didn’t expect any problems. As far as I’m concerned, any assurances from BP about anything should be taken with a grain of salt.


In spite of that siphon hose's marginal success, as of May 15 Pelican, a marine research vessel in the Gulf, found shocking amounts of oil beneath the water’s surface. These oil plumes are around 10 miles long, 5 miles wide, and 300 feet thick. This massive oil mass is severely lowering the oxygen in areas around these plumes which will most surely result in massive dead zones on the ocean’s floor. And yes, fish need oxygen. That’s what those gills are for. I actually heard someone ask, “What difference does it make if there’s no oxygen? It’s water, isn’t it?” Obviously, he flunked elementary school science.


As of today, May 19, an area the size of the state of PA is off limits for fishing in the Gulf. Senator Bill Nelson of FL just noted that strong southerly winds have already pushed a string of this oil into the Loop Current and that it is expected to reach the shores of Key West in 5 days and Miami beaches in 10.



Gulf shore community's economies depend upon the food and recreational fishing industries as well as tourism. This is no “modest” impact, and I’m pretty sure BP knows that. They have made decisions about their own bottom line, and so they can pay for the mess they made. The Senate currently has a bill to raise the liability of oil companies to $10 billion since the last cap was set in the 1970’s. Sen. Barbara Mikulski (R Alaska) put a hold on it for a couple days. Now James Inhofe (R Oklahoma) has a hold on it because he fears the size of this cap would prevent “Mom and Pop” companies from going into the oil drilling business because they couldn’t afford to pay this cap. If they can’t afford to clean up the possible messes of their business, they shouldn’t go into that business. Other businesses have to have the insurance they need to do that business, don't they? Does Inhoff think you and I should shoulder disaster costs because Mom and Pop’s Oil Drilling Company can’t afford it? BP can well afford it. They have had successive quarters announcing profits (not income—profits) of $4 and 5 billion. They made the mess, and they have to clean it up. However, they are also ruining state and individual businesses’ livelihoods. The few million now set aside for liabilities won’t be a drop in the bucket for what they’ve already done. I say if they drill down and cause a disaster, they can cough up the money to pay those affected. If you can’t pay, stop playing.


Transocean surely does have the money to pay their part. Nonetheless, they are, at this moment, in a Texas court arguing that their liability should be capped at $27 million, and this is not because they can’t afford to bear any more of the responsibility. They finished drilling the Deepwater Horizon well for BP on April 19 and flagged it form the Marshall Islands—a teeny tiny country with almost no regulatory laws--and on April 20, the $650 million rig exploded. Two days later it sank and the oil is still rushing out over twenty days later. If one were to look at the $650 million loss, maybe the $27 million dollar cap could seem less unreasonable. That is, unless you knew that the company, headquartered in Switzerland—known for its ocean frontage? No, it’s lax rules on drilling—hadn’t had a shareholders meeting this past Friday where they voted themselves over a billion dollars in cash to be distributed among their shareholders now. (I know: An oil well dug off coast of U.S., flagged in Marshall Islands and headquartered in Switzerland...Logical? Not really. I wonder why?)



We have all lived with the belief that these industries can regulate themselves. We now know the price of this kind of lax regulation. They are in the business to make money. We should be in the business of making sure that they make that money without destroying the local environment, the lives of people living there, and the planet as well. If they decided it would be too much trouble—and therefore cost--to take the time to replace a stupid gasket to assure pressure measurements were correct, it is obvious they need watching, and careful watching at that.



We now know they only invested in ways to get the oil out. They made no plans as to what to do if one of those wells blew. A Tom Toles editorial cartoon at Washington Post.com sums it up well: If a hat doesn't work, how about a shoe or other Monopoly tokens? I myself would like to see a halt on all off-shore drilling until they show plans for disasters, well-tested plans. We may pay a little more for gas at the pump, but as it is, we will any way, and we will also pay the cost in the grocery store for sea food. Restaurants may go under in some areas, and hotel and recreational facilities located on the Gulf will continue to hurt, resulting in lost livelihoods and tax revenues. Whose fault is it? Not yours or mine.

Let’s act instead of waiting to react.