Leak from Chevron Pipeline Raises New Concerns About Aging Oil-Production Infrastructure in the Gulf


Chevron is reporting that a leak from a pipeline at its Main Pass 299 platform in the Gulf of Mexico released 2.3 gallons of crude. According to a Sept. 14 Reuters report, there was “no recoverable volume of oil visible” in the shallow waters 40 miles east of Venice, Louisiana, where the Chevron installation is located.

Earlier in the week, the California-based oil giant shut down a portion of its Main Pass pipeline network and its Cypress line, which moves approximately 9,000 barrels per day in oil production, to investigate the leak. Chevron is now mulling options to repair the damaged 10-inch pipe that connects the Main Pass 299 platform to equipment on the seafloor. As of Thursday afternoon, between 6,000 and 7,000 barrels per day of production that was offline due to the leak had been restored, according to a company statement.

Photo credit to Reuters

Although this appears to have been a minor incident, it is yet another grim reminder that oil-production equipment does fail and oil leaks do happen. At the risk of sounding like a trigger-happy environmental doomsayer, it’s only a matter of time before another catastrophic spill takes place. In an imperfect oil-fueled world, that’s just reality. Smart policy within that context is defined by minimizing the risks inherent in drilling and production and by ensuring our preparedness for the inevitable (i.e., an effective oil spill response).

Safety and effective spill response are issues the White House should be hyper-focused on as it moves to open an additional 20 million acres of the Gulf to new offshore oil exploration and drilling. President Obama has slated the new lease sales, the first since last year’s 200-million-gallon spill, for Dec. 14.

One safety issue that needs immediate attention is the Gulf’s aging oil-production infrastructure.

We’ll have to wait for the conclusions of the Chevron investigation to determine what caused the leak at its shallow-water platform, but questions abound such as whether the pipeline had exceeded its original design life or had been recently and properly inspected.

The first drilling platforms in the Gulf date back to the 1930s. And according to the federal government’s ocean energy bureau, of the 3,900 facilities active in the Gulf, 30 percent are more than 30 years old. The heightened risks posed by thousands of deteriorating, decades-old platforms and miles upon miles of rusting pipeline have long been ignored by oil and gas industry regulators – and that reckless disregard has created ticking time bombs across the Gulf of Mexico. Consider this from a Dec. 14, 2010, Wall Street Journal report:

The deadly explosion of the Deepwater Horizon drilling rig in April set off a fierce battle over deep-sea oil drilling aboard huge, state-of-the art vessels. But that debate has largely ignored what many experts say could be a bigger threat: The troubled state of offshore infrastructure that remains in place long after wells are drilled.

High-tech drilling rigs make up only a small piece of the Gulf’s energy infrastructure, a vast network of tens of thousands of fixed wells, hundreds of permanent platforms and thousands of miles of undersea pipelines. This network together accounts for nearly a third of the oil produced in the U.S. and more than 10% of the natural gas.

Much of that infrastructure is decades old. Roughly half of the Gulf’s more than 3,000 production platforms are 20 years old or more, and a third date back to the 1970s or earlier, long before the development of modern construction standards. More than half have been operating longer than their designers intended, according to federal regulators.

Older structures are more prone to accidents, especially fires, and more dangerous for workers. According to a Wall Street Journal analysis of federal accident records, platforms that are 20 years old or more accounted for more than 60% of fires and nearly 60% of serious injuries aboard platforms in 2009.

“There is an infrastructure issue confronting the industry,” says Charles Swanson, a managing partner with Ernst & Young’s Oil & Gas Center in Houston. “We’re reaching a point now where we’re not going to be able to ignore it any longer.”

Decaying infrastructure is raising grave concerns not only here in the United States but around the world. From an Aug. 17, 2011, Guardian article covering a major spill from Gannet Alpha, one of Shell’s North Sea platforms:

Gannet A should serve as a wake-up call to a government that has for too long relied on industry assurances that the regime in the UK is “fit for purpose” and “robust”. Gannet A and its satellite projects are among the majority of offshore installations that are approaching or have exceeded their original design life (typically 20 to 25 years) and are posing an extra danger the longer they operate. Most of these rigs lie rusting in the southern North Sea region close to the Scottish coastline as they are pushed to extract every last drop of black gold. According to the Health and Safety Executive, the majority of hydrocarbon releases happens at facilities older than 20 years old, and more than 50% of existing platforms fall under that category. Gannet A will be celebrating its 20th birthday next year.

In the neighbouring Ekofisk field, one of the most significant fields in the North Sea, BP is still dealing with the aftermath of a fire that has forced the shutdown of several facilities since last month. One incident in the neighbouring Norwegian North Sea last year required crews to be evacuated and 50 wells shut down as a Statoil facility nearly approached a full blowout. A gas leak on another platform this April resulted in the closure of the field.

The response by the government and regulators has been to downplay concerns about ageing infrastructure and oversell the regulatory regime’s ability to cope with a ticking time bomb. With the government’s “red tape challenge” and swingeing cuts under way, there is a high probability that we will see more major oil spills and worker injuries in the coming years due to lack of regulatory capacity, a general drive towards “light touch regulation” and an apparent reluctance on the part of a government obsessed with “energy security” to challenge Big Oil.

As our federal government moves to open 20 million acres to new offshore drilling in the Gulf, it should be working feverishly to shore up and modernize the old, accident-prone infrastructure that exists today. If we can’t minimize the dangers of operations that are currently in place, it’s simply bad business and bad politics to move forward with new drilling endeavors. In closing, consider this from the WSJ article referenced above:

On Dec. 4, 2009, a severely corroded pipe connecting the structure to a high-pressure gas well gave way during routine maintenance, releasing explosive natural gas into the air. Unlike most modern platforms, this one had no remote shut-off switch. Emergency valves that should have cut off the flow of gas automatically didn’t close properly – in part, a subsequent investigation found, because a control panel was caked in bird droppings. Workers who had fled by boat to a nearby platform were finally able to shut down the well.

Read the full WSJ report here on the aging oil infrastructure in the Gulf: http://online.wsj.com/article/SB10001424052748704584804575644463302701660.html?mod=ITP_pageone_0#project%3DAGING101214%26articleTabs%3Darticle

Read the Guardian report on infrastructure problems in Britain: http://www.guardian.co.uk/commentisfree/2011/aug/17/oil-spill-shell-timebomb

© Smith Stag, LLC 2011 – All Rights Reserved

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Stuart H. Smith is an attorney based in New Orleans fighting major oil companies and other polluters.
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