Friday, May 28, 2010
Everybody out of the Water
The great technological achievement was to learn how to drill a well one mile down.
Except they did not bother to develop the hardware to properly shut down after an accident that was all but inevitable.
Even the blind, dumb and stupid now knows that this must be done. That it was not done should mean an industry wide shutdown and general assessment of costs until this problem is satisfactorily fixed.
And do not even think of putting one of these suckers in the
It is clear that a number of things went wrong. It is also clear that that is inevitable and assigning blame is a cheap human exercise. The prospect of failure should have been imagined at the next level and countered and so on up the top. Just as that is impossible in the airline industry, it is impossible in this industry.
Yes the signals were there and they were dismissed. They died.
We need technology that allows the shutting in of a runaway well. If that means installing a temporary large enclosure over top of the well head that permits the escape of excess fluids in an accident, then so be it. There is a safe time to install such a rig before the well is spudded and a safe time to extract the rig once the well is complete and fully rigged for production.
The blow out preventers need to be rigged in a fail safe mode. This one failed merely because of a loss of hydraulic pressure which was a completely predictable failure mode. Other modes may also have been in play here but this was the one up front.
BP's New Legacy: Everyone Out of the Water!
By Nick Hodge | Thursday, May 27th, 2010
Michael Steele's having a bad year.
The embattled Republican National Committee Chairman has had to battle opposition to his leadership within his own party, defend his organization's $2,000 tab at a
Hollywood strip club, and explain away his use of the term "honest injun" to Native American groups...
But when BP's Deepwater Horizon oil rig exploded in the Gulf of Mexico last month and began what's now looking to be the worst environmental disaster in American history, Steele's year got a whole lot worse.
That's because Steele is the guy who's forever immortalized on tape leading the 2008 Republican Convention crowd of over 20,000 in a resounding chant of "Drill Baby Drill!" — an image that clearly resounds from the last presidential race.
So imagine how he's feeling today.
Every corner of
can't distance themselves from the offshore drilling industry fast enough. Washington
The industry that was once celebrated as perhaps the savior of domestic energy production is now public enemy # 1 in almost every corner of the country.
And every time CNN or MSNBC or Fox News — yes, even Fox News — wants to show viewers how much lawmakers and talking heads were in love with offshore oil just a short time ago, they'll cut right to the clip of Michael Steele.
"Drill Baby Drill!"
This guy can't catch a break.
And if you think it's only Democrats who are vilifying deep sea drilling, think again...
Just check out this quote by a prominent
...this tragedy should remind us that
America needs a real, comprehensive energy plan... which includes more of everything: more clean and renewable sources of energy such as nuclear power, wind, and solar energy, more alternative fuels, more conservation, and more environmentally responsible development of 's energy resources. America
Want to take a guess at which tree-hugging liberal said it?
Al Gore? Nancy Pelosi? John Kerry?
Nope. These words belong to House Minority Leader John Boehner, a Republican from
And how about this assessment of the aftermath of the BP Spill by a leading cable news commentator:
...it's not a matter of if they'll be a disaster of some kind resulting of this kind of offshore drilling, it's only a matter of when. This verifies that argument and becomes a powerful factor in the debate over what to do next. I don't see any way around the political reality that this will set back the cause of offshore drilling in the
... United States
Which member of the left-leaning media said this?
Think again — this statement was uttered by none other than Fox News' ultra-conservative Brit Hume...
It seems like we've finally found something to unite the parties.
On both sides of the aisle, the tide has turned shockingly fast. Gov. Schwarzenegger of California — who had supported deep sea drilling off his state's coast — has now recently changed his mind and spoken out against it.
President Obama — who, in late March, finally relented against increasing pressure to approve more offshore oil projects and gave the OK to rigs in Alaska, the Eastern United States, and the Gulf — is now backpedaling and freezing all new permits for the time being.
And a CNN public opinion poll shows that support for offshore drilling has dropped 17% nationally between August 2008 and May 2010.
It's clear that the oil game is about to change... possibly forever.
But what does that mean?
Well, first of all, it means that deep sea oil will take a hit — a hard hit — for quite a while.
But it won't die; there's simply too much oil in the ocean to let it all go, no matter how many disasters occur.
"An oil spill here or there hasn't gotten in the way of oil extraction anywhere," states Peter Maass, journalist and author of the 2009 book Crude World: The Violent Twilight of Oil.
In the short term, don't expect to see many new rigs popping up from your beach chair this summer; at least in the short term, oil companies are going to be forced to move inland.
That means outlets like the oil sands in
are going to see increased attention and exploration. So far, 32 billion barrels have been identified. Oil companies undoubtedly will start sending in teams looking for more. Utah
But perhaps the greatest beneficiary from the BP disaster will be oil shale deposits — particularly ones in
's Bakken region. North Dakota
The good news just keeps on coming out of this domestic oil hot spot. Brigham Exploration Co. announced yesterday positive results from two more of its wells in its core Bakken acreage.
That was enough to send its share price up 11% on Wednesday.
Every day, the barrel estimates just keep going up in the Bakken region. And with oil companies staying out of the water for the time being, odds are we'll be seeing a lineup at the North Dakota state border as the petro barons fight for a piece of what's bubbling up from the shale.
So then what's the play?
Well in the coming weeks, stay tuned to Energy and Capital for a new report detailing three small American companies making big moves into the Bakken region.
This is, without a doubt, one of the rarest opportunities to exploit public sentiment for profit that I've ever come across.
You've heard it before, but it bears repeating: Crisis breeds opportunity.
We've got the crisis — now prepare for the opportunity.
Watch for this new report appearing soon.
Call it like you see it,