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Corporate Culture on Deepwater Horizon
July 22nd, 2010
The lead article in today’s New York Times, “Workers on Doomed Rig Voiced Concern on Safety,” describes a corporate culture at Transocean, the owner of the rig, such that workers were afraid to report essential safety issues to management. In a survey of workers just before the well blowout, many noted an emphasis on drilling priorities over safety priorities. One worker describes the attitude of Transocean at “Run it, break it, fix it,” and the article noted that the rig had never been in dry dock during its nine years of operation. In fact, 26 components on the rig were found to be in poor condition. [In other "oil-related" developments, a squall may be moving into the Gulf of Mexico, resulting in temporary removal of the cap on the well. Another potential blow to residents of the area.] I guess we shouldn’t be surprised at all these revelations, especially when you’re dealing with an unregulated industry and an inherently dangerous task with high profit potential. Still, a company’s most sacred duty is the protection of its employees, and that, at least, represents the most glaring failure of the Deepwater Horizon. I’m certain there will be more revelations to come. And hopefully, they will spur the clean energy industry in our country at long last. BP Oil Disaster: The Beginning of the End?
July 19th, 2010
The lead article in today’s New York Times, “In Revised Plan, BP Hopes to Keep Gulf Well Closed,” describes the continued success of the new cap placed on the oil gusher one mile below the sea’s surface. The pressure tests seem to indicate the integrity of the well, and the federal government remains cautiously optimistic as well. One disturbing note: there have been some “anomalies” at the sea bottom on the sea floor nearby. They do not indicate oil is leaking through the substrata, a potentially disastrous occurrence because then there would be nothing to do to counteract it. Meanwhile, the relief well drilled to provide a permanent fix for the problem draws near conclusion, when mud and then cement would permanently halt the gusher. In other good news, there were no new reports of oil hitting beaches, and skimming ships at the sea’s surface could only find one area to conduct a controlled burn compared to 19 the day before. This whole event has been a trauma, mostly for Gulf Coast residents, but, in actuality, for the entire nation as we have experienced a rare feeling for Americans, helplessness, as we have watched the oil spew forth. Maybe, it provides a lesson for us about the limits of a can-do approach and the need to be less self-reliant in the future. If I may digress from the general tone of this blog — at these times, many have turned to a higher authority than the federal government and resorted to prayer. BP’s Swashbuckling Record
July 13th, 2010
The lead story in today’s New York Times, “In BP’s Record, a History of Boldness and Blunders,” provides a fascinating account of this corporate organization, with much to admire and detest, often at the same time. This company has consistently been at the forefront of technological innovation, pursued political deals noone else would take, often at a considerable risk, and, at the same time, made many costly errors. The political deals included agreements with the oil oligarchs in the newly formed Russian confederation after the Soviet Union collapsed, and a contract to help Iraq improve its oil well productivity at a shockingly low $2 per barrel, to the dismay of many of its competitors. The company was also pushing the envelope in technological innovation, pursuing what the industry called “elephants,” big projects with potentially lucrative returns instead of a smaller, safer ventures. But with boldness comes failure, and the article also chronicles a series of setbacks at Texas City, with the Alaska pipeline, and at another rig in the Gulf called Thunder Horse. Overall, there is much to admire and detest about this company. It encompasses all the glories and ignomies of the capitalist system, a system that has created more wealth for the average person than any other in the history of the world, while simultaneously exploiting many of those same people. As the saying goes about democracy, it is one of the worst systems except for all the rest. All About Blind Shear Rams
June 21st, 2010
The lead article in today’s New York Times, “Between Blast and Spill, One Last, Flawed Hope,” provides a detailed analysis of blowout preventers and one of their crucial components, blind shear rams. The blind shear ram is supposed to cut off the pipe to prevent a blowout, but it is vulnerable to “single-point failure” should hydraulic pressure to the valve fail. For this reason, many blowout preventers now carry two blind shear rams in case one fails. The article also mentions other problems with blind shear rams. Apparently, much more pressure is required to operate them for deep-water operations, and if the blind shear ram tries to cut the pipe at one of its joints, a 10-percent possibility, it is more likely to fail. Apparently, engineers were aware of some of these problems and, based on prior operation, the failure rate of blind shear rams was estimated at as much as 45 percent. Even the Mineral Management Service received a suggestion in 2001 that two blind shear rams be required on all rigs because of possibility of failure, and in 2003 received suggestions about an emergency back-up system to activate blowout preventers. For anyone interested in more technical analysis of the problems in the gulf, this article should be required reading. It extends over two-and-a-half full pages, providing a detailed description of blowout preventers and their components. Anti-Business Obama?
June 18th, 2010
The lead article in today’s New York Times, “Strong Steps or Oversteps?” is a news analysis piece looking at the Obama presidency in terms of its relationship with business. The piece is particularly apt in light of Republican representative, Joe Barton, and his statement yesterday that the $20 billion fund to assist suffering Gulf residents, represented a Presidential shakedown of BP. Other actions taken by President Obama to save the auto industry, and rein in executive compensation by banks who had been saved from failure by the government, were examined in this light as well. The article concluded by noting the unique rationale for each of these actions but left an ominous tone of a revised interpretation should they continue. And what would have happened in these cases had President Obama taken no action? Total unmitigated disasters that would have doomed his presidency and left him open for excoriation for dereliction of duty. These Republicans will stop at nothing to oppose this President. They do not care about helping the people, solving problems or relieving suffering. All they care about is their own recapturing of power. It’s difficult for me to come to any other conclusion. I have tried to take an even-handed, measured analysis of stories, but this conclusion is inevitable. They are trying to manipulate President Obama in such a way that “he’s damned if he does, damned if he doesn’t.” This can not be allowed to continue. Kudos to President Obama
June 17th, 2010
The lead article in today’s New York Times, “BP to Set Aside $20 Billion to Help Oil Spill Victims,” represents a major triumph for President Obama after his negotiations with the chairman of the board of BP, Carl-Henric Svanberg, at the White House yesterday. The fund will be administered by a neutral third party, Kenneth Feinberg, who also managed the fund to compensate victims of September 11 as well as asbestos and Agent Orange claims. He also served as pay czar regarding approval of executive compensation and bonuses at the major banks. The agreement provides pluses for all concerned. The fund will be phased in at $5 billion per year, helping BP to manage its cash flow and removing a lot of uncertainty for investors. In fact, BP stock went up after the announcement. Even John McCain, one of President Obama’s most visceral critics, agreed it was “a step in the right direction.” President Obama also won another victory, letting BP contribute $100 million “voluntarily” to compensate oil rig workers who experience financial difficulties due to the current six-month moratorium on offshore drilling. BP had previously been adamant about refusing such support. The only kerfluffle concerned a remark by the Mr. Svanberg about how BP cares about the “small people.” That soon died off as it came from a problem in the translation from Swedish. President Obama to the Rescue
June 16th, 2010
The lead article in today’s New York Times, “President Calls for a New Focus on Energy Policy,” recounts President Obama’s forceful speech last night and his multi-pronged steps to fight the disaster in the Gulf. These steps include 1) the appointment of Ray Mabus, a former governor of Misssisippi, to create a Gulf restoration plan with local residents; 2) the deployment of 17,000 National Guard troops and his encouragement for their rapid use; 3) the creation of a clean energy policy; 4) the establishment by BP of a fund containing billions of dollars to be administered by a neutral party to pay claims resulting from the oil spill; and 5) the appointment of Michael Bromwich from the Justice Department to restructure the Minerals Management Service. President Obama outlined some of the details of this policy as well; one of the most interesting ideas was the establishment of efficiency standards for buildings as well as cars. The speech was a powerful call to action and was the type of address to give people hope after the long nightmare we have been going through during this environmental disaster. Of course, we need to wait to see how these proposals pan out. A key event will be the meeting today between President Obama and BP officials. Oil and the Best Laid Plans
June 15th, 2010
The lead article in today’s New York Times, “Efforts to Repel Gulf Spill are Described as Chaotic,” examines in detail the response so far to the oil spill in the Gulf of Mexico. It describes overlapping authority, too much focus on stopping the flow instead of protecting beaches and fragile marshlands, poor communication and many other failures. After the Exxon Valdez catastrophe, Congress had passed legislation to create detailed plans for reaction to oil spills in the future, the Oil Pollution Act, yet during this spill, the response has been plagued by five different plans with overlapping authority and distrust among the various players. As a result, duplication of efforts often occurred, and people fought with each other in public when they had to cooperate in private. Requests to response agencies were often ignored for days or weeks; the distribution of containment boom was chaotic; and workers were often sent en masse to areas where they were not needed. The oil spill plan for southeast Louisiana had not been updated for seven years, and many areas showing wetlands are now open water. There seems to be some progress now after turning the operation over completely to local Coast Guard authorities, but the operation as a whole seems to have been totally inadequate and uncoordinated. An Exxon Valdez Every Eight Days?
June 11th, 2010
The lead article in today’s New York Times, “Experts Double Estimated Rate of Spill in Gulf,” lists the new figure of the spill rate from BP’s oil spill as 25,000 to 30,000 barrels per day. The estimate was provided by the Flow Rate Technical Group and comes after the lowering of sonar equipment to the ocean floor for a more precise measurement. Doing some elementary math: a barrel is 42 gallons; 30,000 barrels is almost 1.3 million gallons. The total spill from the Exxon Valdez was 10.8 million gallons. That translates to an Exxon Valdez occurring every eight days. Yikes! People are now starting to talk about doomsday scenarios. What happens if the relief wells, due to be completed in August — still a seeming eternity away — don’t work? What happens if oil starts leaking from other places under the ocean floor when the pressure to cap the current well takes effect? Could we one day start to see oil at Jones Beach? Would the loop current take it all the way up the Eastern seaboard? It seems impossible now, but today’s situation seemed impossible when the rig first blew up. In my opinion, we should use this disaster as a springboard to totally divorce ourselves from oil, period. All oil companies should immediately be tasked to make a complete transition to any other energy source of their choice. It will entail some economic dislocations, but once it was all over, we would be in a much better place than any other nation. The project should be the equivalent of our attempt to land a man on the moon. Oil, Oil, Everywhere
June 7th, 2010
The lead article in today’s New York Times, “Coast Guard Sees Oil Spill Cleanup Lasting into Fall,” paints a sobering picture of the effects of the BP oil spill far into the future. According to the leader of the response effort, Admiral Thad Allen of the Coast Guard, the oil will continue to spread until the leak is sealed once and for all, when the first relief well is completed in August. Then, the cleanup would continue for several months more. Meanwhile, the cap designed to divert the flow to a storage ship achieved only limited success. The control staff decided not to close the vents because they were already reaching the upper end of their capacity to process and store the oil, 10,000 barrels a day. A variety of other containment efforts are slated to improve upon the capping system. Do you ever feel like you’re getting strung along, step by frustrating step. One certainly feels this way about BP’s stopgap efforts. They seem like they’re just designed to bide time until the relief well is finally completed. Because otherwise, people would be calling to dismantle the company and jail its chief executives. Maybe, at this point, we should focus 90 percent of our effort on cleanup and understand that the best opportunity now involves keeping the spill away from land. |
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