There is a reason why deep water oil drilling is thought of as a frontier industry. Drilling through 2.5 miles of rock located beneath just short of a mile (5,100 feet) of water really is at the frontier of our current technology. At those depths, necessarily working with remote robot technologies, the scope for accidents is all too broad. Indeed, it is remarkable that we have not witnessed more disasters like BP’s 2010 Deep Water Horizon tragedy.
One of the contributory factors behind the Deep Water Horizon blow-out and fatal explosion was the determination of operator BP and suppliers Halliburton and Transocean to drive down costs. For example, cement used to cap the well proved inadequate, allowing gas to flow back along the drill pipe to the rig.
However, the wrong quality cement is far from the only component that could soon result in another disaster according to Ted Mann at the Wall Street Journal:
“General Electric oil drillers and U.S. regulators are scrambling to determine why massive bolts used to connect subsea oil equipment keep failing, prompting costly shutdowns and raising safety concerns about hundreds of wells in the Gulf of Mexico.”
Thus far, the bolts – which are used by several other companies as well as GE – have not resulted in oil or gas leaks. However, the threat of further spills into a Gulf of Mexico still recovering from BP’s 2010 spill is being taken seriously:
“Regulators say they are working with drilling companies, manufacturers, and the API to craft new standards for minimum hardness and coating of subsea equipment bolts, as well as guidelines for assembly and installation.”
Once again, the short-term drive to reduce costs (in this case by not asking too many questions of the sub-contractors that made the bolts) is likely to prove expensive in the long run. According to Mann:
“The bolt issue could affect more than 2,400 platforms and oil rigs in the Gulf of Mexico, as well as 23 off the coast of California, and one active rig on the outer continental shelf in Alaska.”
At as much as $800,000 per platform/rig to remedy the problem, energy companies are looking at a bill of more than $19.2bn. At a time when the world is over-supplied with oil, and with prices stubbornly stuck below $50 per barrel, this is a bill an already struggling industry can ill afford to pay.