Tag Archives: BP Deepwater Horizon Oil Spill

The Impact of Oil Spills on the Deep Sea: the Deepwater Horizon Oil Spill

The Louisiana University Marine Consortium (LUMCON) published in September 2019 a study on the Deepwater Horizon Oil Spill in Royal Society Open Science.  The BP’s Deepwater Horizon oil rig exploded in April 2010, killing 11 workers.  The subsequent cleanup and restoration had cost nearly $65 billion..but while while we can burn off and disperse oil on the surface, but we don’t have the technology to get rid of oil on the seafloor. So approximately 10 million gallons of it settled there….In 2017 , the The LUMCON surveyed the site surrounding the wreck of the rig, and another one 1,640 feet north. There were no giant isopods, glass sponges, or whip corals that would have jumped (metaphorically) at the chance to colonize the hard substrate of the rig, such as discarded sections of pipe…..But]  crabs were just about everywhere. The researchers were shocked by the sheer number of crustaceans and other arthropods that had colonized the spill site. According to rough estimates, Atlantic deep sea red crabs, red shrimp, and white caridean shrimp were nearly eight times more populous at the Deepwater site than at other spots in the Gulf. “Everywhere there were crabs just kicking up black plumes of mud, laden with oil,” Nunnally says. But abundance does not mean the site was recovering, or even friendly to life. Particularly eerie was the crab’s achingly slow movement. “Normally, they scatter when they see the ROV lights,” he says. But these crabs seemed unbothered, or unaware of the robot’s presence.

Crabs on the seabed of the Deepwater Horizon oil spill

The researchers hypothesize that degrading hydrocarbons are what’s luring unwitting crabs from the surrounding seafloor to the deep-sea equivalent of a toxic dump. “The chemical makeup of oil is similar to the oils naturally present on crustaceans,” Nunnally says. “They’re attracted to the oil site, but everything goes downhill for them once they’re in the area.” A similar kind of chemical confusion occurred at an oil spill in Buzzards Bay in New England in 2003, which attracted hordes of American lobsters. The researchers liken the death trap to the La Brea Tar Pits: Once lured in, the crabs lose their ability to leave. With no other species able to thrive in the area, the crabs have no food source—except each other. And as one might imagine, consuming the flesh of a toxin-riddled crab or starving to death in a deep-sea tar pit is sort of a lose/lose situation.

The crabs also looked anything but normal: some claws shrunken, some swollen, shriveled legs, a dusting of parasites. “There were deformities, but mostly things were missing,” Nunnally says. “You come in with eight legs and try to get away on four or five.” The researchers have yet to ascertain what specific toxins led to these maladies. The shrimp looked just as awful as the crabs. “They didn’t look like shrimp from other sites,” Nunnally says, adding that many of the small crustaceans had humps in their backs—tumors, perhaps.

Excerpts from SABRINA IMBLERS, A Decade Later, the Deepwater Horizon Oil Spill Has Left an Abyssal Wasteland, Atlas Obscura, Sept. 18, 2019

The Nuts and Bolts of Oil Spills

US regulators warned subsea oil drillers and equipment makers that bolt failures in the Gulf of Mexico could result in an oil spill on the scale of the Deepwater Horizon disaster.

“Fortunately, as of today we’ve had no major catastrophes from bolt failures,” said Brian Salerno, director of the Bureau of Safety and Environmental Enforcement  (BSEE) at the Department of the Interior, which oversees the offshore oil industry. “We believe it may only be a matter of time before our luck runs out….. The agency’s working group and a parallel task force set up by an oil industry trade group are trying to determine why critical metal fasteners have corroded and failed in recent years.

Regulators and makers of oil production equipment, including General Electric Co., Schlumberger Ltd. and National Oilwell Varco Inc., are trying to determine what is causing the failures, which have included premature corroding, stripping of threads or snapping outright. The problems have been found over the past four years on safety equipment in underwater oil production, including on blowout preventers, which are designed as a last defense against a major oil spill like the Deepwater Horizon incident in the Gulf of Mexico….

In 2013, GE recalled more than 10,000 bolts after a failure on one of its components, a blowout preventer connector, which led to a spill of more than 400 barrels of drilling fluid in the Gulf of Mexico…. Troy Trosclair, a BSEE supervisor for the Gulf of Mexico region, said Brazilian officials reported that 56 rigs working for Petróleo Brasileiro SA, or Petrobras, that country’s biggest oil producer, were affected by the 2013 GE recall

Excerpts from Ted Mann,U.S. Regulators Warn Drillers to Find Solution to Subsea Bolt Failures, Wall Street Journal,  Aug. 30, 2016

Deep Horizon Oil Spill: final settlement

U.S. District Judge Carl Barbier in New Orleans gave his final approval April 4, 2016 to an estimated $20 billion settlement over BP’s massive 2010 oil spill. On July 2015, BP reached the $20 billion settlement with the federal government and five gulf states. The Justice Department has called it the largest environmental settlement in U.S. history as well as the largest-ever civil settlement with a single entity.  Barbier presided over a multiphase trial for the spill litigation before last summer’s settlement agreement resolved the bulk of the remaining civil claims against BP. The judge heard testimony from rig workers who survived the blast and from company executives who worked on the ill-fated drilling project off Louisiana’s coast. Barbier set the stage for the settlement when he ruled BP acted with “gross negligencein the disaster….

In addition BP pleaded guilty in 2013 to manslaughter for the rig workers’ deaths and agreed to pay a record $4 billion in criminal fines and penalties.

In BP reached a multibillion-dollar settlement agreement with businesses and residents who claim the spill cost them money. That deal didn’t have a cap***, and a court-supervised claims administrator is still processing many of the claims.

***There is no limit on the total dollar amount of the Settlement, but BP will pay no more than $2.3 billion to compensate qualified claimants who are in the Seafood Compensation Program.

While BP has estimated that the total costs of the Settlement will be approximately $7.8 billion, there is no limit on the total amount of the Settlement (with the exception of the Seafood Compensation Program). The actual total amount paid out will depend on the number of qualified claims made, and could be higher or lower than BP’s estimate.***

Excerpts from Judge approves $20 billion settlement in gulf oil spill, Associated Press, April 4, 2016

Anadarko Fined for Gulf of Mexico Spill

Anadarko Petroleum Corp. was ordered to pay almost $160 million for its role as part-owner of the doomed Gulf of Mexico well that in 2010 caused the biggest offshore oil spill in U.S. history.  The fine was the last big uncertainty hanging over Anadarko from the disaster. The order on November 30, 2015  comes after the government told U.S. District Judge Carl Barbier in New Orleans that the company should be fined more than $1 billion for its role in the well’s blowout, which killed 11 people and spewed oil for almost three months. Anadarko, which had a 25 percent stake in the Macondo well, argued it shouldn’t be required to pay fines simply because it owned part of the well, as the accident wasn’t its fault. In 2014, The Woodlands, Texas-based company set aside $90 million for the case when it offered to settle for that amount.

Barbier said the fine reflected his finding that Anadarko didn’t have a role in causing the spill. Under the law, he could have imposed as much as $1,100 per barrel of oil spilled, or about $3.5 billion.  The fine is “only 4.5 percent of the maximum penalty, and therefore on the low end of the spectrum,” Barbier said in his order. “The court finds this amount strikes the appropriate balance between Anadarko’s lack of culpability and the extreme seriousness of this spill.”

Barbier rejected Anadarko’s argument that a heavy penalty could cause minority partners to seek a larger role in offshore operations, which might complicate safety and drilling decisions. “A penalty of this size might encourage non-operators to avoid investing with careless operators,” he said.  The company said it’s pleased the penalty is less than what the government sought and that it’s reviewing whether to file an appeal. “While we respect the court’s decision, we continue to believe that penalizing a non-operator for events beyond its control is inconsistent with the intent of the Clean Water Act,” Anadarko said in a statement posted on its website.

David Berg, a Houston attorney who has tracked the oil spill litigation and often sues polluters on behalf of municipalities, said given the damage from the spill, the fine is “not a slap on the wrist; it’s a tongue kiss from the judge.”  David Uhlmann, former head of the Justice Department’s environmental crimes unit, said the fine is “too small to be an effective deterrent.” It “will not have a significant effect on a company worth approximately $30 billion,” said Uhlmann, now a University of Michigan law professor.

The professor said Anadarko wasn’t a silent partner in its dealings with BP Plc, which owned 65 percent of the well.  “Anadarko urged BP to continue drilling deeper, even when BP wanted to stop,” he said. “Yet the judge refused to consider evidence of Anadarko’s risky behavior, which may explain the small size of Anadarko’s fine.”

Excerpt from Anadarko Ordered to Pay $159.5 Million for 2010 Gulf Spill, Bloomberg Business, Nov. 30, 2015

Gross Negligence: Gulf of Mexico Oil Spill

BP wants its money back — hundreds of millions of dollars of it — but a federal judge said Wednesday (Sept 24. 2014) that the oil giant must stand by the agreement it made with the companies it compensated for losses blamed on the 2010 Gulf oil spill.BP argued that a flawed funding formula enabled nearly 800 businesses to overestimate their spill-related claims.

One construction company hundreds of miles from the coast received $13.2 million, but deserved $4.8 million at most, BP said. Another company selling “animals and animal skins” was overpaid about $14 million, and about 50 others shouldn’t have been paid at all, the company said.  About 150 claimants should return a total of $185 million, and overpayments to the rest haven’t been calculated, attorney Kevin Downey argued.

U.S. District Judge Carl Barbier was not persuaded, thwarting BP’s latest attempt to control potential liabilities now approaching $50 billion.  The judge agreed weeks ago to change the compensation formula for any future payments, but ruled that a deal is a deal when it comes to the money BP has already paid out. Under that deal, claimants agreed not to sue, and BP agreed that no future court action could change their payments….

Barbier said he would rule later on the issue of compensation for cleanup workers whose chronic medical problems weren’t diagnosed until after the deal’s cutoff date of April 16, 2012. The settlement entitled cleanup workers with chronic conditions including rashes and breathing problems to receive up to $60,700 if the problems first surfaced within days of their cleanup work…

BP’s closing share price was $50.20 the day of the explosion, and fell to $22.80 in June 2010, before the well was capped. Shareholders returned after BP set aside $42 billion to cover its liabilities, reassured the financial damage was contained.  That’s no longer so clear: The judge’s ruling this month that BP showed gross negligence and willful misconduct added a new level of uncertainty around BP’s spill-related expenses, reducing its market value by $9 billion in a single day.,,BP’s total potential liabilities now include up to $18 billion in fines and penalties that could be imposed for violating federal pollution laws, and more than $27 billion BP says it has already paid to restore the coast and settle damage claims.

JANET MCCONNAUGHEY and JONATHAN FAHEY,Businesses Won’t Have to Return BP Spill, Associated Press, Sept. 24, 2014

 

What Transocean Pays for the Gulf Oil Spill

Transocean Ltd. appeared in federal court in New Orleans after reaching a $1.4 billion settlement with the U.S. over the 2010 Gulf of Mexico oil spill….The company agreed last week to plead guilty to a misdemeanor count of violating the Clean Water Act and to pay $400 million in criminal fines and $1 billion plus interest in civil penalties. Under the agreement, Transocean will undergo five years’ probation and establish a technology innovation group to focus on drilling safety, devoting a minimum of $10 million to this effort…..

The agreement doesn’t cover costs to Transocean for natural-resources damage under the Oil Pollution Act of 1990, the company said. That law requires responsible parties to reimburse governments for restoring natural resources to pre- incident conditions.  Transocean said last week that the company’s liability for these damages was limited by a 2012 court ruling that it wouldn’t be liable under the Oil Pollution Act for subsurface discharge from the well.

The blowout and explosion aboard Transocean’s drilling rig sent millions of barrels of crude leaking into the gulf. The accident prompted hundreds of lawsuits against Transocean, London-based BP, the well’s owner, and Houston-based Halliburton Co. (HAL), which provided cementing services. BP previously agreed to pay $4 billion to the Justice Department to resolve charges connected to the spill and $525 million to settle the U.S. Securities and Exchange Commission’s claim that the company misled investors about the rate of oil flowing into the gulf.  BP announced Nov. 15 that it reached a deal with the Justice Department to plead guilty to 14 counts, including 11 for felony seaman’s manslaughter. U.S. District Judge Sarah S. Vance said last month that she would determine at a Jan. 29 hearing whether to accept BP’s plea.

The criminal case is U.S. v. Transocean Deepwater Inc., 13- cr-001, U.S. District Court, Eastern District of Louisiana (New Orleans). (pdf)

Margaret Cronin Fisk & Allen Johnson Jr, Transocean Appears in Court After $1.4 Billion Spill Pact, Bloomberg, Jan. 9, 2013

BP: Culture of Corporate Recklessness

The Obama administration has accused BP of gross negligence and willful misconduct in causing the Deepwater Horizon oil spill of 2010. In a new court filing, the Department of Justice appears bent on blaming BP for the worst oil disaster in U.S. history.  The court document blasts BP’s leadership in no uncertain terms. Referring to “A Culture of Corporate Recklessness,” it states that “The behaviour, words and actions of these BP executives would not have been tolerated in a middling size company manufacturing dry goods for sale in a suburban mall.” It criticizes “the utter lack of any semblance of investigation of the systemic management causes deeply implicating the corporate managers and leadership who caused and allowed the rig-based mechanical causes to fester and ultimately explode in a fireball of death, personal injury, economic catastrophe, and environmental devastation.”

Referring to a “negative pressure test” performed by BP and Transocean hours before the blowout, the report states, “That such a simple, yet fundamental safety-critical test could have been so stunningly, blindingly botched in so many ways, by so many people, demonstrates gross negligence.”  The designation of “gross negligence” under the Clean Water Act, is an important distinction because it would mean the company could face $21 billion in civil damages alone—almost quadruple the penalty if “gross negligence” is not confirmed. BP also faces criminal charges.

The case may not go to trial, which is scheduled to begin January 14. Both sides are negotiating to reach a settlement to resolve both civil and criminal violations.  The Justice Department reportedly sought a $25 billion agreement from BP, but now may be willing to settle for $15 billion.

Justice Dept. Accuses BP of “Gross Negligence” over Gulf Oil Spill, AllGov.com, Sept. 7, 2012