BP’s Incentive: To NOT Capture All the Oil

In an interview, Bob Dudley, CEO of BP’s New Gulf Coast Restoration Organization (whatever that is) finally admitted yesterday that their first relief well could be completed far in advance of the mid-August date that they have been insisting on since May, enabled by the Coast Guard and other government officials.  We’ve heard the mantra now for months; even as the relief well, spud on Sunday, May 2, has stayed ahead of schedule, BP has steadfastly stuck to the mid-August completion date.  In the interview, Dudley said that the well could be ready for the kill attempt by July 20th to 27th, but hedged, though, that storms and seas could delay that date.  BP tried walking back his statement this morning, saying,

“He (Dudley) gave that as the very, very best
scenario if everything went absolutely superbly according to plan and
there are no interruptions but the expectation is that it will be
August.”

Coincidently, July 20th is the date that new British Prime Minister, David Cameron, is scheduled to meet with President Obama.  July 27th is the date set for BP to publicly release quarterly financial information.

BP has every incentive to get this well killed.  As you know, I’ve been calling next week Kill Week, and since they are almost there now, only 245 feet from the objective as of yesterday, I still believe that is doable.  The mid-August date never made any sense, unless they took a direct hit from a major hurricane, shutting down operations for 10 to 14 days.  Right now, short of the low pressure area that will come ashore around Brownsville over the weekend, there is no tropical activity even out in the open Atlantic.  Of course, that could always change, as we all know.

I’ve been resisting calling their delays in getting a better recovery system installed footdragging, but I now believe that’s exactly what they’re doing.  As my friend over at Daily Kos, Fishgrease, says, every bit of unmeasured oil that is spilled into the Gulf is later negotiable.  The volume estimates from the Flow Rate Technical Group are just that, estimates, and estimates are arguable in court.  Flow rates and recovered volume reports are bewildering, coming from BP, the Coast Guard, the Unified Command, and the DOE, sometimes matching and never consistent.  Sometimes BP will do a relief well update on their website, sometimes it comes from the Unified Command, sometimes from the Coast Guard in a hastily called press conference.  There is no central place for all information, and you have to know how to navigate the sites that do exist.  You need a degree in quantum physics to compile the information into anything that is deciferable and its a full time job trying to keep up with all of the numbers.   The only source of reliable continuous data is on the DOE Oilspill Data page, but it’s in oilfieldese, so only bewildering to the public.  No wonder everyone is so confused.  I’m paying attention all day every day, know what I’m looking for, and I get confused.   

While they have every incentive to get the well killed, BP also has every incentive to not capture 100% of the well flow until they do.  As soon as they do capture all the flow, then a real, measurable number will be in front of the public, and that’s the last thing BP wants, since that number will then be used to extrapolate environmental damage, hence per barrel fines that will likely run to the tens of billions anyway.  What bewilders me is why the government is letting them get away with it.  Where is the Coast Guard, Steve Chu, the EPA, and the new Bureau of
Ocean Energy Management?  Where is the White House?   Where is the main
stream media?  Are industry bloggers the only ones who are asking these questions? 

Don’t be surprised if the Helix system and the floating riser systems are not completed by kill date.  Also don’t be surprised when the kill attempt happens far in advance of mid-August before the larger system is operational.

I’ll certainly be watching.

Comments

  1. theone says

    el jefe, it is very disappointing to agree this may be the scenario, that there is slow-walking using up valuable clear weather over the next 9 days of reportedly clear Gulf weather – maybe it is just success is will be so much more predictable with 2 relief wells instead of 1, but that 450-ton BOP could collapse to the sea-bed any day, and formation wash-out is likely proceeding apace.
    the WSJ article says BP has been briefing the administration on various back-up plans, but by not letting scientists in to inject flourescent dyes and watch the plume, and pretty much barring journalists, along with copying the Exxon’s Valdez disaster practice of requiring workers with health problems to report to BP’s company ‘ quack shack ‘ thereby making workers’ medical records BP property, BP seems to have an in-ordinate focus on producing the well instead of killing it.
    the interview BP gave to NPR on Wed. 7/7 was one of the most weasely examples of scrambling from a journalist’s probing since Goldman Sachs tried to explain how they are ‘ doing God’s work ‘.
    the industry deserves better than this.

  2. jrinky says

    I say also, don’t be surprised if the shareholders sell the company to someone else, like Exxon or the Saudis, who then try to claim immunity from additional damages and further responsibility because BP will no longer exist.

  3. ioinkthere4iham says

    Great reporting, and I’m happy to see the story was picked up by MSNBC and HuffPO. One question: Does oil recovered count as oil spilled for the purposes of EPA fines?

  4. ioinkthere4iham says

    As of 4:00 pm EDT the AP is reporting Thad Allen says the new cap will be fitted beginning Saturday and the Helix hooked in on Sunday. I think Bob’s report might hace scared the Feds straight!

  5. enclaved says

    I have been reading the blogs here as well as at various other sites where professional oil people post. There has been a lot of well deserved blame tossed at BP and the government; however, I cannot escape the conclusion that since every other big oil company has been shown to have virtually the same greed factors at play, that the professionals I have been following on these blogs are also to blame. If all of the oil field professionals had been insisting that safety should come first, then there would not have been a blow out in the first place.
    The professionals on these blogs are the oil industry. It is past time that all of you take a stand and insist, even at the risk of losing your jobs, that things must be done right.

  6. says

    Sorry to just now be finding you today! I’ve been in a lather for weeks, reading Fishgrease and wondering why so much wisdom and common sense is getting so little traction in the MSM or with Congress.
    I’m encouraged to think you, with your knowledge of the industry, and your media connections might be able to help turn this around.
    As a tech writer for both upstream and downstream energy clients, I cannot understand why no one is demanding an allocation test or asking about separation & measurement data.
    Why is no one asking the hard questions and what can I, and others, do to help turn that around? So much at stake, and so little time left to move the needle in a positive way.

  7. Engineer says

    Bob, excellent post. As an engineer (not petroleum) I have been wondering from day one why they don’t do some obvious things to stop the oil gushing into the Gulf. I have been told by “experts” on several forums that my common-sense engineering is wrong, for reasons they can’t explain to my satisfaction. The more I dig into the issues, however, the more I am convinced that my initial impressions were right.
    This is the first time I have heard a plausible explanation of the foot-dragging. I say plausible, but I think it is still hard to believe. Even if the fines based on an exact calculation of the oil flow were more than the tens of billions in real damages, most of which BP will pay, surely they could get an agreement with the Feds – drop the fines and let us do what is right. Surely the Feds would agree – every dollar in fines may be costing the public ten or a hundred in actual damages.

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