Feds unveil plan for keeping offshore oil wells in check five years after Gulf spill

WASHINGTON — The Obama administration on Monday unveiled a plan to better safeguard offshore oil wells that aims to prevent a repeat of the Deepwater Horizon disaster that marred the Gulf of Mexico nearly five years ago.

The measure codifies many of the steps that companies have already taken to better keep offshore wells in check, including more rigorous maintenance and testing of the blowout preventers that act as a last line of defense against uncontrolled surges of oil and gas.

Oil companies and their drilling contractors would have to completely break down and do a detailed physical inspection of those emergency devices every five years. And companies drilling in deep water would be forced to monitor their operations in real time from on shore within three years.

But one of the most substantial potential changes could be more than a decade in the future: a possible requirement for new-and-improved blowout preventer shear rams that can cut through almost anything in their path to help seal off open wells at the bottom of the sea.

Interior Secretary Sally Jewell described the proposed regulation as “one of the most significant environmental and safety reforms” for offshore drilling, drafted in response to shortcomings illustrated when BP’s Macondo well blew out on April 20, 2010, sending explosive gas onto the Deepwater Horizon rig, triggering an explosion that killed 11 workers and and unleashing the nation’s worst oil spill.

But she and other Interior officials repeatedly stressed to reporters Monday that the measure largely echoes changes that oil companies and contractors have already made or are making offshore.

“These are rules that are largely in place in terms of best practices,” Jewell said. Although the proposal has an estimated industry-wide price tag of $883 million over 10 years, Jewell noted that drilling contractors are “already spending this money on their equipment, and that cost is already being passed on to operators.”

“We don’t anticipate that these rules are going to materially make a difference in terms of the economics of the offshore oil and gas industry,” she added. “We think it will continue to be robust and attractive for industry participants.”

Investigations into the 2010 disaster repeatedly pointed to deficiencies in the design of the hulking blowout preventers, including the shearing and sealing rams that can be activated to cut drill pipe and block off a well hole during an emergency. A forensic investigation of the blowout preventer used atop BP’s failed Macondo well concluded that a powerful rush of oil and gas caused drill pipe to buckle and shift off-center, ultimately preventing the BOP’s shearing rams from cutting the pipe and sealing the hole.

Read more: Blowout preventer failed because of off-center drill pipe

Blowout preventer manufacturers are already testing new methods for keeping drill pipe centered inside those shear rams, boosting the odds of being able to slice through it in an emergency.

The coming rule lays out a new requirement to use that nascent pipe-centering technology and gives the industry seven years to develop, test and roll out any new designs.

The measure also would require oil companies to use two shear rams in subsea blowout preventers, with the redundancy viewed as boosting the likelihood that a drill string can be sheared. That mandate would be phased in over five years for subsea blowout preventers and surface blowout preventers on floating facilities.

Outside of the proposed rule text, the safety bureau is inviting the public to comment on a possible 10-year requirement to boost the power of shear rams so they can sever almost anything in their path — including drill pipe, debris and the much-thicker tool joints where pieces of pipe are bound together. But the agency stopped short of actually proposing the mandate.

Bureau of Safety and Environmental Enforcement Director Brian Salerno said the agency “went back and forth” on whether to formally propose requiring that severing capability.

“That capability does not exist currently,” Salerno said. “We decided to put that out there as question and to specifically seek comment on whether that is a realistic requirement and whether it is achievable…recognizing it will take a number of years to develop this capability.”

The measure attacks well control comprehensively — extending beyond the blowout preventer installed at the wellhead to the weight of the drilling muds and other fluids inside it, which exert pressure on the underground formation to help keep oil and gas at bay.

In proposing the rule, the safety bureau acknowledged that most well-control problems happen when the weight of the fluids in the hole is too weak to hold back the pressures in the well.

Oil companies generally turn to weighted drilling muds, which are more dense than sea water, to exert that needed pressure. But they must carefully balance fluid weights and pressures in the well; too much risks cracking the formation itself.

Under the proposed rule, oil companies would be required to hand over more information about the maximum effective density of their drilling fluids. Regulators also are adopting a tighter definition of what constitutes the “safe drilling margins” in which companies can operate.

Although the proposal now covers a broader array of well control methods and systems, its scope is in many ways more limited than what industry representatives expected after the Interior Department held a forum on blowout preventers in 2012. At the time, it appeared regulators would impose new BOP requirements wherever they are used offshore — even on jack-up rigs stationed in shallow waters.

But most of the final rule’s requirements are aimed at subsea BOPs or those working above the water on floating facilities.

Industry representatives had a muted reaction Monday, as they examined the 264-page measure. American Petroleum Institute upstream director Erik Milito said in a statement that the group was “reviewing the proposal.”

While some mandates will be relatively simple to implement, others were being viewed as aggressive and burdensome.

One possible trouble spot could be the timelines for phasing in new requirements. For instance, retrofitting blowout preventers with yet-to-be-developed pipe-centering technology could take longer than than the seven years the safety bureau envisions.

“We are concerned that reasonable and necessary time is allowed for proposed design and manufacturing modifications,” said Randall Luthi, head of the National Ocean Industries Association. Luthi also stressed that the group wants to ensure that proposed third-party reviews and certifications “are a useful tool for verifying safety measures and not merely an increase in a bureaucratic process.”