Regulators order drillers to replace faulty bolts

Drilling on roughly two dozen offshore oil and gas wells may be temporarily halted so companies can replace faulty bolts on emergency devices, after federal regulators identified problems with the equipment.

At issue are bolts on GE-manufactured H4 connectors used on blowout preventers and lower marine riser packages on subsea wells.

The Interior Department’s Bureau of Safety and Environmental Enforcement on Jan. 29 issued an alert to companies drilling offshore, notifying them that the bolts needed to be replaced.

The problem was identified in an investigation of leaking drilling mud from a Gulf of Mexico well blamed on a fractured H4 connector, and at least two other episodes, according to the bureau’s notice.

Regulators told operators to replace the bolts on affected equipment, though it appears companies may be able to work the repair into existing maintenance schedules. For active drilling operations, that means unearthing the devices and replacing the bolts before sending the equipment back underwater. In other cases, companies have to swap out the bolts on devices that aren’t in use.

Potential downtime for active rigs ranges from none — for wells almost completely drilled — to 14 days, according to an analyst by Angie Sedita, with UBS Investment Research.

Sedita told clients that it appears blowout preventers made by Hydril and National Oilwell Varco might be affected by the flawed bolts, with Cameron BOPs untouched by the problem. “We believe most of the companies have an inventory of these bolts,” Sedita said.

In a research note to clients, FBR Capital Markets stressed that “this is not a blanket stop work order, but rather a process to allow operators to safely replace the affected equipment in conjunction with individual risk assessment time lines, submitted to and approved by the regulator.”

Some of the bolt replacements have already been completed, and all are expected to be finished within several days. Some companies using GE connectors have been able to identify that the bolts on their equipment are not part of the affected batch, averting the work. In the case of nearly finished wells, companies may be able to complete drilling before pulling a blowout preventer for bolt replacement, because it would not be safe to stop sooner.

“The bolt replacement process is well under way,” said GE Oil & Gas spokesman Sean Gannon. “Many of the replacements are already processed.”

According to the safety bureau, of the 83 rigs currently operating in the Gulf of Mexico, 24  were identified as using the H4 connector, though not all will have bolts from the bad batch.

Six rigs have been cleared to return to activities as of noon Wednesday, with the remaining 18  conducting operations that do not require a blowout preventer, currently inspecting the bolts, or in the process of completing operations to reach a safe point for pulling the device out of the water.

“Less than a third of the rigs operating in the Gulf were affected by GE’s safety notice,” the bureau said in a statement. “The inspections and verifications are being done on a rolling basis.  (The) Interior (Department) is committed to ensuring that oil and gas production continues to take place safely and responsibly.

It is not clear how many offshore operations in international waters ultimately will be affected. Gannon said as many as 30 to 40 GE customers could be affected.

GE said in a statement that it was “working with regulators and our customers to determine the cause, and, to identify, inspect and replace similar bolts in use elsewhere.”

Drilling regulators in other countries also have been notified.