Archive | Oil & Petroleum

Deepwater Horizon Spill Could Happen Again Without Reforms, Panel Says

A panel appointed to study the Deepwater Horizon oil spill in the Gulf of Mexico says the blowout was caused by a series of risky decisions intended to save time and money.

The seven-member commission also claims the incident could happen again without significant reforms.

A 48-page excerpt of the report was released Wednesday prior to the full document’s publication early next week.

“The blowout was not the product of a series of aberrational decisions made by rogue industry or government officials that could not have been anticipated or expected to occur again,” the report said. “Rather, the root causes are systemic and, absent significant reform in both industry practices and government policies, might well recur.”

BP’s Macondo well began uncontrollably gushing crude oil on April 20, setting off the largest marine oil spill in the history of the petroleum industry.

The panel contends that BP, Transocean and Halliburton company personnel did not adequately consider the risks involved in a series of time-saving steps.

“The most significant failure at Macondo — and the clear root cause of the blowout — was a failure of industry management,” panel members concluded. “Better management of decision-making processes within BP and other companies, better communication within and between BP and its contractors and effective training of key engineering and rig personnel would have prevented the Macondo incident.”

Bob Graham, a former Florida senator, and William K. Reilly, a former EPA administrator, were appointed by President Barack Obama last May to lead the commission designed to identify the underlying causes of the blowout.

Posted in Drilling for Oil, Environmental Disasters, Oceans & Coastlines, Oil & Petroleum0 Comments

Shell’s Arctic Clean Air Permits Revoked

Alaska Native and environmental groups have successfully thrown a wrench in Shell’s plans to drill exploration wells in the Beaufort and Chukchi seas.

An order by the Environmental Appeals Board remanded Shell Offshore Inc.’s clean air permits, which were granted by the Environmental Protection Agency. Shell spokesman Curtis Smith told The Associated Press that the company cannot proceed with the proposed drilling plans in 2011 without the permits.

The review by the federal board found that the EPA’s estimation of the impact on Alaska Native communities was too limited. It also contended that the agency’s analysis of impact caused by nitrogen dioxide emissions from drill ships and support vessels was inadequate.

The appeal was filed by the Arctic Eskimo Whaling Commission, the Inupiat Community of the Arctic Slope, the Center for Biological Diversity and Earthjustice on behalf of other organizations.

Rebecca Noblin, an attorney with the Center for Biological Diversity in Anchorage, said the ruling coincides with the groups’ assertion that the EPA “rushed” the drilling permits through the process. “It’s time for the administration to take a step back and rethink the foolhardy rush to drill in the fragile Arctic Ocean,” she told the Alaska Dispatch in an e-mailed statement.

Posted in Air Pollutants, Air Quality Standards & Emissions, Drilling for Oil, Oil & Petroleum0 Comments

Bolivia Fuel Hike Sets Off Massive Protests

Bolivia lapsed into nationwide pandemonium Thursday as protests against an 83 percent rise in fuel prices shut down public transport.

President Evo Morales’ government decreed the gas cost hikes Sunday, announcing it could no longer afford to subsidize the previous prices, which had been frozen for six years, AP reports.

The response in the Andean country was violent unrest as thousands of demonstrators marched and bus drivers maintained the four-day strike that has left major cities largely immobile.

Morales attempted to placate citizens Wednesday by announcing a 20-percent minimum salary increase, but unions and civic groups said the demonstrations would go on nevertheless.

The gasoline subsidies that kept prices low for years cost the government about $380 million per year, AFP reports.

Morales’ administration says the hikes are necessary partly because much of the subsidized gas was being smuggled across borders to neighboring countries.

Posted in Oil & Petroleum, Politics & Politicians0 Comments

Oil Prices Dip Slightly

Oil prices settled at $91.12 per barrel of benchmark grade crude on the New York Mercantile Exchange Wednesday, and other energy commodities fell as the East Coast worked to dig itself out from Monday’s snow storm.

Energy prices usually climb as the weather gets colder, but industry analysts say that most traders have locked in their energy contracts for the year, and investors still buying are looking ahead to 2011, The Associated Press reports.

Heating oil for January delivery fell less than a penny to $2.524 per gallon, gasoline for January delivery fell 1.47 cents to $2.3909 per gallon, and natural gas for February shed 3.1 cents at $4.257 per 1,000 cubic feet, AP reports.

At the pump, the national average price of unleaded gasoline was $3.061 per gallon, up 1.2 cents from Tuesday’s $3.049, AAA said.

Posted in Energy Industry, Natural Gas, Oil & Petroleum0 Comments

Gulf Oil Rig Explosion Caused by Collapse of Defenses, Report Finds

The oil rig explosion that left millions of gallons of crude streaming into the Gulf of Mexico on April 20th occurred because all of the Deepwater Horizon’s defenses against a blowout failed, the New York Times reported Sunday.

The Times collected interviews with 21 Horizon crew members, accounts of the 94 survivors who escaped the disaster, and documents describing the rig’s operations in order to perform a comprehensive investigation of the tragedy that spurred the largest marine oil spill in the history of the petroleum industry.

The newspaper found that failure to prepare for the worst combined with the complexity of the Horizon’s defenses contributed to the disaster.

Much of the crew was unaware of the crisis for nine minutes as the drilling crew fought the blowout, the Times said.

Crew members were paralyzed by the complexity of the rig’s defenses and could not coordinate a response. One emergency system alone was controlled by 30 buttons, the paper noted.

While Transocean had provided the crew with a handbook detailing how to respond to a blowout, the emergency protocols called for rapid action while advising against overreaction.

Posted in Drilling for Oil, Environmental Disasters, Oil & Petroleum0 Comments

Gas Prices Will Rise to $5 by 2012, Shell Exec Warns

Gas prices will climb to $5 and rationing will be necessary by 2012 if ineffective governing continues, a former Shell executive said Tuesday.

John Hofmeister, former president of Shell Oil, told the Platts news service that political indecision could lead to all-time high prices at the pump and national shortages as soon as a year down the road.

“The politically driven choices that are being made, which are non-choices, essentially frittering at the edges of renewable energy, stifling production in hydrocarbon energy — that’s a sure path for not enough energy for American consumers,” Hofmeister said, according to UPI.

He predicted that lawmakers will panic when they “suddenly” realize they need to rework the U.S. energy strategy around 2012.

“When American consumers are short or prices are so high — $5 a gallon for gasoline, for example, by 2012 — that’s going to set a new tone,” he added.

Hofmeister also expects that the newly Republican-controlled House will make for political gridlock in 2011, fixing energy dependency on hydrocarbons and preventing the exploration of sustainable methods.

The national average price of unleaded gasoline rose Tuesday to $3.049 per gallon, up from $3.042 Monday, AAA said. Oil was up 10 cents at $91.03 a barrel on the Nymex.

Posted in Biofuels & Biomass, Energy Industry, Natural Gas, Oil & Petroleum0 Comments

Stephen Baldwin Sues Kevin Costner over BP Oil Machine

Stephen Baldwin is suing fellow actor Kevin Costner over their investments in a machine that BP used to separate oil from water.

Baldwin reportedly owned 10 percent of the Costner-backed company that made oil-separating centrifuges. A federal lawsuit filed in New Orleans, Louisiana Wednesday alleges that Costner and his business partners “schemed” to get Baldwin to sell back his shares of an $18 million deal for BP to purchase the devices in the wake of the Deepwater Horizon oil spill.

Costner’s representatives declined to comment, AP reported.

The suit seeks unspecified damages.

Posted in Courts & Litigation, Drilling for Oil, Environmental Disasters, Oil & Petroleum0 Comments

EPA Takes Over Texas Carbon Emission Permits

The Environmental Protection Agency Thursday announced its plans to take over carbon dioxide permitting of any new power plants and refineries in Texas, citing the state’s refusal to comply with emissions regulations going into effect Jan. 2.

Texas industries have openly opposed the Obama administration’s Clean Air Act, a program designed to curb greenhouse gas emissions. They claim that the cuts will threaten productivity, and that the economy, in turn, will take a hit.

The EPA said Thursday that it was reassuming the state’s Clean Air Act Permits because “officials in Texas have made clear . . . they have no intention of implementing this portion of the federal air permitting program,” The Associated Press reported.

“EPA prefers that the state of Texas and all states remain the permitting authority for (greenhouse gas) sources,” the agency said in a statement. “In the same way that EPA has worked with other states and local agencies, the agency stands ready to do the same with (Texas).”

The EPA constructed a framework for carbon emissions regulations in seven other states: Arizona, Arkansas, Florida, Idaho, Kansas, Oregon and Wyoming.

The agency also devised a timetable for establishing the cuts for all U.S. facilities and power plants. It plans to propose performance standards for greenhouse gas emissions beginning in July for powerplants and for oil refineries by December. The standards will be finalized in May 2012 for powerplants and November 2012 for refineries.

Gov. Rick Perry spokeswoman spoke out against the EPA’s decision to directly issue air permits in Texas.

“The EPA’s misguided plan paints a huge target on the backs of Texas agriculture and energy producers by implementing unnecessary, burdensome mandates on our state’s energy sector, threatening hundreds of thousands of Texas jobs and imposing increased living costs on Texas families,” Cesinger said, according to the San Antonio Express.

An estimated 167 new or expanding projects would be subject to the EPA takeover. Texas lays claim to more oil refineries, chemical plants, and coal-fired power plants than any other state and produces the most greenhouse gas emissions and industrial pollution in the country, AP reports.

The new carbon emissions standards were adopted after a 2007 Supreme Court ruled that greenhouse gases should be classified as pollutants under the Clean Air Act and EPA research in 2009 revealed that the gases have a harmful effect on human health.

Posted in Air Pollutants, Air Pollution, Coal, Courts & Litigation, Drilling for Oil, Energy Industry, Global Warming, Laws & Regulations, Oil & Petroleum, Ozone, Policies, Pollution Prevention0 Comments

Ethanol Fuel Additive Law Brings Automakers to Appeals Court

U.S. carmakers and engine manufacturers have filed a lawsuit against the Environmental Protection Agency over its decision to allow the sale of gasoline containing 15 percent ethanol.

The EPA ruled on Oct. 13th that filling stations could start selling gasoline containing more of the corn-based additive for vehicles built in 2007 or later. The current blend contains 10 percent ethanol.

The various organizations Monday asked a federal appeals court in Washington to review the October decision. They claim the approval of the E15 blend violates the Clean Air Act, and that the fuel could damage engines.

“We want to be sure that any new fuel will not increase air pollution, harm engines or endanger consumer safety,” Michael J. Stanton, president of the Association of International Automobile Manufacturers, said in a joint statement with the other members of the Engine Products Group, according to BusinessWeek.

The Renewable Fuels Association,  an ethanol trade group, said the EPA should have allowed E15 for more models.

“The only way to meet the nation’s energy, economic and environmental goals as put forth in the Renewable Fuels Standard is to increase ethanol consumption,” the group said in a statement.

The suit, Alliance of Automobile Manufacturers v. U.S. Environmental Protection Agency, 10-1414, was filed in the U.S. Court of Appeals for the District of Columbia Circuit.

Posted in Air Pollutants, Drilling for Oil, Energy Industry, Laws & Regulations, Oil & Petroleum, Policies0 Comments

Heating Oil Shortage in U.K.: Brits Deny Possible Rationing

A heating oil shortage in the United Kingdom reportedly has the government considering a rationing plan to get families through the winter.

Severe winter storms and inflated prices have been hitting U.K. heating oil users hard in recent weeks. An estimated 660,000 households, schools, hospitals, and other buildings without access to gas supplies are looking at a three- to four-week waiting period before they receive more fuel.

U.K. energy minister Charles Hendry said the situation could become “very serious indeed” if the fierce winter weather continues, SkyNews reported Friday.

Labour Member of Parliament Tom Watson went so far as to describe the situation as “an oil supply crisis.”

But despite reports that Mr. Hendry met with the oil supply industry to discuss the possibility of rationing, ministers say there are no plans to implement heating oil restrictions.

SkyNews quoted the Department of Energy and Climate Change as saying: “We are categorically not planning to introduce rationing of oil. Not now. Not in the near future. It’s not on the cards.”

Still, while members of Parliament didn’t use the word “rationing,” some observers believe that the subtext was there.

After all, on Thursday Energy Secretary Chris Huhne said the government was “attempting to ensure that people don’t have too much so there is enough to go around.”

On Friday the government announced its plans to relax laws for delivery drivers, giving them an extra hour to transport the much-needed oil to homeowners and businesses.

Meanwhile, oil prices edged up Friday on the New York Mercantile Exchange as the Republican-backed tax cut package made its way to President Barack Obama’s desk.

Investors hope that the bill, which seeks to prolong Bush-era tax cuts and extend jobless benefits, will stimulate the economy and raise consumer demand for oil.

Benchmark oil for January delivery was up 34 cents to $88.04 a barrel in midday trading, The Associated Press reported.

Heating oil rose 0.82 cent to $2.4845 a gallon, gasoline futures rose 2.65 cents at $2.3308 a gallon, and natural gas added 1 cent at $4.058 per 1,000 cubic feet, AP said.

The tax breaks implemented during George W. Bush’s presidency have a Jan. 1 expiration date, and the new measure would extend the cuts an additional two years. The bill would also enact a break in Social Security taxes and prolong a series of business tax cuts in an effort to promote investment.

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