Big Oil's Big Blunders

Panel investigating Gulf oil spill issues recommendations for avoiding another disaster. Is anyone listening?

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Steven Cherry:

Hi, this is Steven Cherry for IEEE Spectrum's "This Week in Technology."

"The explosion that tore through the Deepwater Horizon drilling rig last April 20, as the rig's crew completed drilling the exploratory Macondo well deep under the waters of the Gulf of Mexico, began a human, economic, and environmental disaster. Eleven crew members died, and others were seriously injured, as fire engulfed and ultimately destroyed the rig. And, although the nation would not know the full scope of the disaster for weeks, the first of more than 4 million barrels of oil began gushing uncontrolled into the Gulf—threatening livelihoods, precious habitats, and even a unique way of life."

So begins the 380-page report released this week by the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling, appointed by President Obama back in May.

And it spares no one—not British Petroleum, not any of its subcontractors, not the entire offshore oil industry, which it says failed to have spill response measures in place, and not the American government, which it says allowed the industry to take unacceptable risks to the safety of its workers and the environment as a whole. Speaking with me today about the report is Professor Bob Gramling, an environmental sociologist at the University of Louisiana and the author of three books on offshore oil drilling. His newest is Blowout in the Gulf: The BP Oil Spill Disaster and the Future of Energy in America.

Bob, welcome to the podcast.

Bob Gramling: Thanks.

Steven Cherry: I was sad to learn of the loss of your coauthor, William Freudenberg, who died from cancer in December, just as your book was reaching store shelves. He was only 59.

Bob Gramling: Yeah, he knew it was coming, and that gave a certain urgency to the book. We got it out at the end of October, which was basically two months before he died.

Steven Cherry: Wow, that's quite an effort. You and he have been in the forefront of research that applies the methods of sociology to environmental science. And maybe we'll get to that in a little bit, but let's turn to the Gulf spill. Before we dive into the report itself, maybe we can start with the Deepwater Horizon. In your book you call it a "marvel of technology." Why don't you tell us about the remarkable technology that allowed BP to literally dig itself into a hole it couldn't get out of.

Bob Gramling: Well, it's kind of an interesting technology in that it's both state of the art and then at the same time very sort of brutal-force oriented. It's a global positioning system that holds it very precisely in place while it does its work. But at the same time this huge machine generates tremendous amounts of force, can pump tremendous volumes of fluid, and measures its output in terms of barrels, not gallons or ounces. So while it is a technological marvel, it's also very much a brute-force machine.

Steven Cherry: You know, the report says in its conclusions, "The immediate causes of the Macondo well blowout can be traced to a series of identifiable mistakes made by BP, Halliburton, and Transocean that reveal such systematic failures in risk management that they place in doubt the safety culture of the entire industry." Maybe you can tell us first what some of those identifiable mistakes were.

Bob Gramling: Well, there are many people who think that the whole design of the well—the way the final casing was put in—was not appropriate for the water depth and for an unstable formation like this well went into. And so that would probably be identified as the first mistake. Other mistakes that followed were as the well was being cemented, along the casing you have these devices called centralizers that are designed to hold the casing in the center of the hole that's bored through the rock, so that when you force cement between the casing and the rock it can flow evenly around the casing. Now the Halliburton design called for 21 of these, and BP used 6.

Steven Cherry: Wow.

Bob Gramling: And apparently, Halliburton did not even know that BP had only used 6 until after the cement had been poured—or pumped.

Steven Cherry: I understand that there were some really obvious and I guess shocking problems with BP's spill response plan, and nobody ever noticed those. What was wrong with the plan?

Bob Gramling: [laughs] Lee Clark, who is a pretty famous risk-assessment analyst, calls things like these "fantasy documents," and basically this is a big boilerplate document that was put together by a consulting firm. And it just makes totally unrealistic assessments of the probabilities that oil will reach shore in case of a spill, of the ability to scoop up the oil, or to boom it off to keep it from going, you know, ashore in the open Gulf of Mexico. And it has such obvious errors as the go-to biologist for a spill was from the University of Miami, and unfortunately he died five years before the plan was written. And it talks about sensitive wildlife in the Gulf such as seals and walruses, which haven't been in the Gulf for several million years. And it's just, it's a boilerplate thing, and the irony of it is that virtually every multinational that works in the deep water in the Gulf essentially used the same document.

Steven Cherry: Now as it turns out, there are no walruses in the Gulf, but it is one of the great ecologies of the United States and the world, and it was put pretty severely at risk.

Bob Gramling: Yes. I think that's an understatement.

Steven Cherry: You note in your book that the concern about oil spills is really right at the heart of environmentalism, and in fact, the first observance of Earth Day was motivated in part by the 1969 Santa Barbara oil spill off the coast of California. But that environmentalism didn't prevent the Exxon Valdez, and then the country freaked out about that, but that didn't lead to measures that would prevent the BP disaster, which spilled the equivalent of the Exxon Valdez every four and a half days for more than two months. You know, in other words, after 40 years, the risks have only gotten worse. What are the chances we'll ever tackle this problem seriously?

Bob Gramling: I don't know. I mean, the report of the commission is pretty blunt, but how seriously it will be taken, who knows? It's quite ironic that the same Americans that get upset when we pour oil into the oceans drive SUVs.

Steven Cherry: So it's something that we're all going to have to change, I guess. You know your book makes a really powerful argument that the underlying economic forces that are pushing us towards riskier and riskier behavior will never be resolved.

Bob Gramling: The entire leasing program in the Gulf was designed by James Watt—you know, that's kind of like putting Count Dracula in charge of the blood bank. And it is specifically designed to transfer public lands into private property—and indeed the richest corporations in the world—quickly, efficiently, and cheaply, and it has done precisely that in the Gulf.

Steven Cherry: And I gather from your book that the leasing arrangements are just really very different in the United States than they are pretty much anywhere else in the world.

Bob Gramling: By a lot, and it's also much easier to work in—there's less regulatory oversight in the U.S., at least than there is in most of the industrialized world.
The royalty rate is actually, depending on particular sales, either 1/6 to 1/8 the value of the oil. In many places in the world, it's 50 percent, or 25 percent, or 60 percent. So just the royalty alone is much lower in the United States.

Steven Cherry: Now, you're not a petroleum engineer: you're a sociologist. How did you come to be studying the oil industry and writing books about oil spills?

Bob Gramling: [laughs] Well, I'm also a fisherman, and I moved to Louisiana in 1969, and I've always fished in the Gulf of Mexico. And it was impossible for me not to notice and be curious about these structures. And then I met Bill Freudenberg, and he was on a minerals management services scientific committee, and I was on a National Academy of Science committee that was looking into a minerals management services studies program, and we met, and I guess drove each other on.

Steven Cherry: Bob, I just want to finish with a quote from the commission's report and ask you for your reaction. This is on page 293—it's really quite a report.
"The significance of the Deepwater Horizon disaster, however, is broader than just its relevance to the future of offshore drilling. The disaster signals the need to consider the broader context of the nation's patterns of energy production and use, now and in the future—the elements of America's energy policy."

Bob Gramling: Yes, that's quite a statement. I would argue that what had happened with American energy policy—well, we don't have much of an American energy policy. What had happened is that we started an energy policy with the embargo with Richard Nixon, and he was the first one to use the term "energy independence," and that has sort of become our energy policy. Unfortunately, every single president since Richard Nixon has used the same words and has talked about offshore oil as a way to become energy independent, and when Richard Nixon used the words, we were importing about 30 percent of the oil we used. When Barack Obama used the words last year, or the year before last, we were importing 60 percent of our oil. So at the same time the rhetoric has been going in one direction, the reality has been going in the other.

Steven Cherry: So, energy independence sounds impossible. What should we be doing instead?

Bob Gramling: [laughs] Well, I think there's three related questions here: Can offshore oil bring energy independence? Can oil bring energy independence? And can we reach energy independence at all? And I would argue that the answer to the first two is clearly no, and the answer to the third one is only if we change our style of life. The two topics that we just covered—royalty rates and the U.S. values of its offshore resources—and energy independence are related. And basically what we have here is what Bill called a "double diversion." And the first is a diversion of energy resources cheaply and quickly into the handful of a few of the wealthiest corporations in the world. And the second diversion is of attention, or, how do we justify this practice? And the way we justify the practice is through the concept of energy independence.

Steven Cherry: Well, thank you, Bob, for your time.

Bob Gramling: My pleasure.

Steven Cherry: We've been speaking about the presidential commission's report released Tuesday investigating the Gulf oil spill, with Bob Gramling, author of the new book Blowout in the Gulf. For IEEE Spectrum's "This Week in Technology," I'm Steven Cherry.

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