6-25-10, 8:30 a.m. – BP operations chief Doug Suttles sat down with a bunch of reporters from the Times-Picayune yesterday and got grilled over the question of how much oil is coming out of the Macondo well and why the estimates were so completely wrong. Suttles sounds like a reasonable guy and you want to give him a fair hearing, but the answers to the questions don’t satisfy:
|Oil spill video: BP's Doug Suttles talks to The Times-Picayune|
A few thoughts here. First, Suttles and Adm. Thad Allen, the government’s point man on this disaster, have both said their response doesn’t really depend on the flow rate from the well. That’s actually probably true – whatever the amount of oil is you’ve got to stop it at the source, and however much oil is out there you’ve got to clean it up. Of course, our grievance with BP isn’t with a lack of effort at stopping the leak but their results in doing so. They’ve tried a bunch of stuff; it just hasn’t worked.
But on the cleanup side it’s quite clear neither BP nor the government deployed anywhere near enough assets to do the job. The fact that beaches and marshes from Morgan City to Panama City are getting slathered with crude oil is all the evidence you need of that one. Instead of sucking up the oil with gigantic siphons and big tankers, we got Corexit – which is a mediocre solution at best. And that’s an indictment of BP.
But here’s the thing. Suttles is probably flat-out lying when he says that BP hasn’t considered the size of the fine they’ll have to pay to the federal government for the spill, which is calculated at $1100 per barrel if BP isn’t found negligent and $4300 per barrel if they are. You’re talking about fines in the neighborhood of $10-12 billion if all this oil is accounted for, but like Suttles says they’ll fight all that out later.
Of course you will, Doug. And when it’s time to fight that out you’re going to be really glad that you used all that dispersant so the oil couldn’t be picked up and measured. As such, BP will get away with only paying a fine one a portion of the oil spilled.
And while that’s evidence of pretty shady behavior on BP’s part, you almost can’t blame them. $4300 for a barrel of oil you’d sell for $70 on the world market is a ridiculously stupid fine. The morons in Congress who set up that scheme have incentivized dishonesty among oil companies by making the number so high, and that’s why we’re not seeing big oil tankers out in the Gulf sucking up that oil and gathering it as fast as it comes out of the well. Were the fine more like “market price per barrel, plus federal royalty” then BP would have no incentive to use dispersant on it – gathering the oil out on the water would involve the cost to get it, plus a little extra, as opposed to huge crews of people to go walk beaches and giant remediation programs along the shores when the oil shows up three months later.
So that’s a failure of clowns like Henry Waxman and Ed Markey, who wrote laws on oil spills designed to make themselves feel good rather than create a system which actually solves a problem. And our sense is that Allen understands this – but if he were to couch any of his media statements in that understanding he would bring down so much hell on himself that it’s just not worth his while. Guy has been in the Coast Guard for some 40 years; he’s not rocking the boat.
In any event, the more you hear all these guys talk, the more you realize that this thing is a Biblical-sized cockup because it was set up to be one. And while BP and the federal government have both shown astonishingly inept leadership, the seeds of this Charlie Foxtrot were sown on Capitol Hill years ago.
6-23-10, 2:50 p.m. – So we’re back to square one now at the spill site. In fact, at this point it’s worse than it’s ever been.
Apparently, one of the robot submarines bumped into a vent on the cap over the spill and closed it. This created a dangerous situation with respect to pressure, and gas started coming up through the lines which are supposed to send mathanol and warm water down to prevent hydrates from forming. So BP pulled the cap off and they’re inspecting the system now.
Which means that outside of the oil going through the choke valves on the blowout preventer, it’s all blowing out into the Gulf.
BP says they’ll replace the cap as soon as they’re done making sure it still works. Meanwhile, the spill was smaller when it was constricted by the crimped riser pipe.
Also, the Times-Picayune has a story talking about some of the vague statements BP keeps making. The verdict? They’re lawyered-up and doing everything they can not to make those lawsuits against them bigger or more numerous.
And finally, with a hat tip to Cliff at Red Stick Rant, we have crunchy morons from Colorado taking pot shots at Morgan City’s Shrimp and Petroleum Festival, with the suggestion that given the spill it ought to be cancelled as a sop to the politically correct. The article itself is excrement; the comments are beautiful.
6-23-10, 9:45 a.m. – Plaquemines Parish President Billy Nungesser made a name for himself with some pretty frank comments about the performance of BP and the Obama administration in the efforts to clean up the oil coming ashore in Louisiana, but after a time Nungesser had made a conscious effort to tone things down.
But yesterday, when the Interior Department – the same Interior Department whose secretary Ken Salazar found himself savagely rebuked by U.S. District Judge Martin Feldman for what the judge called an “invalid” moratorium on deepwater drilling – shut down the sand dredging program in the Chandeleur Islands, Nungesser’s blood pressure shot right back up.
Nungesser fired off a letter to President Obama threatening media fireworks if the situation isn’t remedied.
“It says if it shuts down, I’ll be on Anderson Cooper at nine…and it won’t be pretty.”
Louisiana Gov. Bobby Jindal is right there with Nungesser.
“It took so long to approve this project. We don’t want to be tied up in more red tape,” he said.
The gist of the dispute is that the Interior Department doesn’t like the location where the dredge in the Chandeleurs is drawing sand from. Interior wants the sand to come from an area north of the area being dredged, which would require a five-mile pipe being run. Last night was the deadline the government set for the moving of the dredge, and the state didn’t meet it – so the feds shut the project down.
Interior Assistant Secretary Tom Strickland said the berms are important in protecting marshes and wildlife. “But the berms have to be built right so they don’t compromise the barrier islands, which serve as a first line of defense against storm surges and hurricanes,” he said.
“We will continue to work closely with the state of Louisiana to move the project forward as we fight to protect Louisiana’s coasts, communities and wildlife from the BP spill,” Strickland said.
Of course, once the sand berm is complete there is nothing to stop the state from using the dredge to replace the sand vacated from the current dredging area with sand from somewhere else. That’s the kind of thinking, though, which goes out the window when you’re not interested in cooperating with the people who are fighting to save their coast from oil.
6-22-10, 11:00 a.m. – We’re not sure if National Review’s Rich Lowry reads The Hayride (not yet, we don’t think), but his column today echoes several things we’ve been saying for at least a week or so.
Not that we were the only ones saying them, of course.
In any event, Lowry addresses the fact that BP has for better than a decade spent lots of time, money and effort to rebrand itself as some kind of new, hip, left-wing energy company that has moved beyond the gauche, crass capitalism of oil. And in the process of at least publicly de-emphasizing their core business, they compiled a shameful safety record culminating in the Gulf spill.
BP knew how to play the game. It repeated all the environmentally correct platitudes that tickle the fancy of “NGO leaders, journalists, political elites,” in the words of the case study. It supported the fashionable reform of the day, cap-and-trade, knowing that the system would favor the big and connected, like itself. And it showered campaign contributions on the candidate of Hope and Change (its employees gave Obama about twice as much in donations as they did John McCain in 2008).
BP couldn’t have been notionally greener if Al Gore were its CEO. The group chief executive of BP, Lord John Browne, warned of the dangers of hydrocarbons, a little like the city fathers of Newcastle in the 19th century inveighing against coal. In a speech at Stanford in 2007, Browne advocated an “international climate agency” that would entail “a move beyond the limitations of national sovereignty.”
This green one-worldism was awfully rich coming from an executive of an oil company that couldn’t even drill responsibly. Despite all the hokum, BP spent vastly more resources on fossil fuels than green energy. In so doing, it compiled an atrocious safety record that made the poor decision-making that led to the blowout in the Gulf unsurprising to industry insiders.
And now tens of thousands of barrels of petroleum a day are fouling the Gulf, courtesy of the corporation that spent so much convincing people it was “beyond” it.
Got that right.
Lowry also notes that the whole “Beyond Petroleum” spiel was cooked up by BP’s pollster Stan Greenburg – the same Stan Greenburg who’s married to Democrat Connecticut congresswoman Rosa DeLauro and the same Stan Greenburg who owns the pad Rahm Emanuel has been living in rent-free for a decade.
It’s funny, because instinctively conservatives want to defend a private company engaged in commercial activity from rapacious government vultures like the Obamas and Waxmans, Boxers and Markeys of the world. But upon any examination in depth at all it’s quite obvious that BP simply doesn’t fit that narrative. This is a crappy, rent-seeking company which spent millions lobbying our government in an effort to saddle us with a cap-and-trade policy which would provide lots of subsidies for its “alternative energy” boondoggles while jacking up the price of its core products, all the while compiling a safety record which would make John Rockefeller blush. And the fact that BP is lousy with lefty luminaries – Tony Podesta, Jamie Gorelick – simply adds to the story.
As Lowry says, a free market philosophy is perfectly consistent with a seething hatred of BP. BP doesn’t like free markets any more than Obama does. They like a rigged corporatist game. And that’s not capitalism.
6-22-10, 7:30 a.m. – We were going to get to this yesterday, but lots of things intervened. It’s an AP article putting the Gulf oil spill in perspective.
While not minimizing the size of the disaster – it’s very bad – the coverage of the spill has from the beginning conveyed the impression that the Gulf of Mexico was going to be filled top-to-bottom with crude oil. And when the oil hit shore, it got even worse.
The fact is, even by the time this is over you wouldn’t even be able to fill the Superdome with the oil that has come out of that well.
The Mississippi River pours as much water into the Gulf of Mexico in 38 seconds as the BP oil leak has done in two months.
On a more human scale, the spill seems more daunting. Take the average-sized living room. The amount of oil spilled would fill 9,200 of them.
Since the BP oil rig exploded on April 20, about 126.3 million gallons of oil has gushed into the Gulf. That calculation is based on the higher end of the government’s range of barrels leaked per day and the oil company BP’s calculations for the amount of oil siphoned off as of Monday morning. Using the more optimistic end of calculations, the total spill figure is just shy of 68 million gallons.
For this by-the-numbers exercise, The Associated Press is using the higher figure.
For every gallon of oil that BP’s well has gushed into the Gulf of Mexico, there is more than 5 billion gallons of water already in it. And the mighty Mississippi adds another billion gallons every five minutes or so, according to the U.S. Environmental Protection Agency.
So BP chief executive officer Tony Hayward was factually correct last month when he said the spill was “relatively tiny” compared to what he mischaracterized as a “very big ocean.”
But another big number that Hayward provided on Thursday also offers some troubling news. He said the reservoir of oil under the sea that is the source for the leak is believed to hold about 2.1 billion gallons of oil. That leaves about 2 billion gallons left to spew. So there are about 16 gallons of oil underneath the sea floor yet to gush for every gallon that has already fouled the Gulf. If the problem were never fixed, that would mean another two years of oil spilling based on the current flow rate.
More not-so-dreadful context: The amount of oil spilled so far could only fill the cavernous New Orleans Superdome about one-seventh of the way up. On the other hand, it could fill 15 Washington Monuments and two-thirds of the way up a 16th. If the oil were poured on a football field — complete with endzones — it would measure nearly 100 yards high.
So if you de-mystify the numbers on this and you recognize the size of what we’re actually talking about, the answer you get is that if there were real leadership and if a coherent and intelligent plan was being followed, this spill could be dealt with. We’re going to get our fishing industry back. Oysters and shrimp, too. And the birds and turtles will survive after taking a hit. We’ll even keep the nutria around.
How hard it is to come back from this disaster, though, depends on the amount of leadership we get. And while it appears we’re in such a colossally better position locally with this spill than we were five years ago when Katrina came to town, that simply isn’t true on a national basis. And of course, BP sucks.
Speaking of BP, they say their first relief well is now nearly 16,000 feet deep, so they appear pretty close to the bottom of the Macondo wellbore. At some point they’re going to turn the drill and try to hunt for the bottom of that wellhead. There are people who will tell you the well bore is so compromised that even a relief well won’t stop this problem, and that at some point the sea floor is going to collapse and the wellhead with it – and at that point the site will turn into a caldera of oil and gas. This theory suggests that what’s really going on is a race in which BP has to complete the relief well before all this happens.
Not being blessed with more than a sliver of geologic or engineering knowledge, we can’t comment intelligently on that – but logic would dictate that if you can drill the relief well down to the bottom of the Macondo bore and then plug the thing, the problem goes away. It certainly appears that’s what BP thinks, and while they’ve proven to be untrustworthy on lots of things and evidence continues to tumble out that their safety performance was nothing short of abysmal it’s not a major reach to trust their basic statements on engineering, particularly when they’re backed up by folks from other companies who concur that a relief well which intersects Macondo at the bottom will finish this saga.
Time will tell. Meanwhile, three Republican Senators – Kay Bailey Hutchinson and John Cornyn of Texas and George LeMieux of Florida – have authored a bill that would provide a blanket waiver of the Jones Act in the Gulf so that foreign-flagged skimmers could come in and help out. But some of this Jones Act stuff has been overblown, say opponents of the bill, as beyond three miles from shore the Jones Act doesn’t apply – and foreign skimmers can work the area close to the spill site without any problem.
Of course, what the opponents aren’t saying is that a skimmer which collects oil off the water has to offload it somewhere, and that somewhere usually involves a port – in America in this case. While you could make the argument the Jones Act still wouldn’t apply, it’s a little sticky. Seems like you’d want to remove all the obstacles to getting help from anybody who’s willing, particularly since the Jones Act is a protectionist union-driven law anyway and ought to be junked.
Finally, we have this – the spill is wiping out beach weddings along the Gulf Coast.
Now it’s a tragedy.
6-20-10, 10:00 a.m. – Things seem to be getting dumber as the spill gets worse.
As we discussed Friday, BP CEO Tony Hayward got fired, more or less. He still technically has a job, but BP’s chairman Carl-Henric “Small People” Svanberg is taking over as the company’s front man and VP Bob Dudley, an American, is now going to be the go-to guy on the oil spill. That makes Hayward something of a “Minister Without Portfolio” for now, and since BP isn’t likely to build him a ghost army of inflatable drilling rigs a la George Patton, the likely outcome is that he’s going to get a check and a trip to the gate.
So the guy got fired, he’s probably looking at a ruined career and a reputation and life which, to his way of thinking, has been stolen away despite working his rear end off for it. And on a Saturday, after he’s basically been fired, Hayward went on a boat trip to get his mind off his troubles.
And for this he’s getting excoriated yet again.
BP CEO Tony Hayward has faced fresh criticism for taking time off to go boating with his son instead of dealing with the Gulf of Mexico oil spill.
The White House said the move was one of a “long line of PR gaffes and mistakes” by Mr Hayward.
Environmental groups said the Isle of Wight outing was “insulting” to those affected by the environmental disaster.
BP defended Mr Hayward, saying it was his first day off since the spill began after a deadly rig blast on 20 April.
We’re not particularly in the business of taking up for Tony Hayward. He represents a company with an abysmal safety record we think is a direct result of wasting its money on crap like windmills and biofuels and which helped, along with Enron, to invent the idea of Cap-And-Trade back in 1997, has made a fortune on it in Europe and has funneled a huge amount of money to Democrat politicians in an effort to inflict it on the United States. On Hayward’s watch, moreover, we think BP bribed the Obama administration to have its MMS look the other way as it cut corners on a nightmare well the wellbore of which appears to have been compromised as far back as February, and that’s of a piece with all these residual Clinton-era lefties who seem to have a check coming from BP – Jamie Gorelick shows up at the White House Wednesday as BP’s outside council, Tony Podesta is their chief Capitol Hill lobbyist, Rahm Emanuel lives rent-free in an apartment owned by Stan Greenberg (BP’s pollster who helped craft their $200 million “Beyond Petroleum” corporate makeover). Presumably none of this is going on over Tony Hayward’s objections, and it’s hard to imagine he’s not aware of it.
So as far as we’re concerned, if Tony Hayward’s career is ruined we just want it to be a cautionary tale that if you’re going to run an oil company try not to suck at it by focusing on things which aren’t your core business. But once those chickens come home to roost and you get a pink slip, it’s none of our business what you do on Saturday. Even in Grand Isle, which is Ground Zero for the recovery effort where mayor David Camardelle was quoted ripping Hayward for going on a boat, they had a big party last night with a bunch of chefs from New Orleans feeding the folks.
“Everything is about the oil,” one Louisianan said, “and we need a little break.”
Besides, Barack Obama’s performance with respect to this oil spill has been every bit as dishonest, incompetent and calamitous as Tony Hayward’s is – and not only won’t he get fired until January 2013 at the earliest, he got to spend his weekend going to baseball games and playing golf.
Tim Newman, a Brit with an oil background who runs a good energy blog at White Sun Of The Desert, does a nice job going through the last few days of Hayward’s life, including getting ramrodded by the simpering troglodyte Henry Waxman at that committee hearing Thursday, and concludes as we do that the outrage (largely manufactured by a White House attempting to pin everything on Hayward while its machinations with Svanberg go on in the shadows) about the outgoing CEO and his boat trip is asinine.
Besides, what would these idiots have him do on his one day off in almost two months of fire-fighting? Run around town in a hair shirt before spending a couple of hours standing on hot coals self-flagellating?
After all, it was Rahm Emanuel who offered up the quote about Hayward’s “PR gaffes” which poured gas on this story in the first place. You’d think Emanuel, whose accomodations are paid for by that company, would have the good taste to shut up. But this is about throwing Hayward under the bus and sacrificing him to preserve the benefits the Obama administration seeks to derive from their continued cozy relationship with BP. Things like intellectual honesty, consistency and relevance aren’t part of the mix.
6-18-10, 2:00 p.m. – We saw some of the Passion Of Tony Hayward yesterday, and it occurred to us that he was at the same time dispirited, evasive and disconnected. It almost looked like he didn’t give a damn, and he was just trying to get through that hearing rather than attempt to make his company look good (or given that result is impossible, at least minimize the damage).
Hayward might have felt like it was impossible to get a fair shake, we thought, and that might be an explanation for his rather dispassionate or even petulant attitude during his testimony. What we also thought was a legitimate possibility turns out to have been the case – namely, that he knew he was on his way out at BP.
A day after he was grilled by Congress, BP chief executive Tony Hayward is being demoted. According to Britain’s Sky News, BP Managing Director Bob Dudley will take over day-to-day oversight of the Gulf of Mexico oil spill while BP’s chairman Carl-Henric Svanberg (he of the “small people” comment) will assume major PR duties. (Yes, you read that right—the BP executive who famously expressed his compassion for “the small people” will be tasked with enhancing the company’s public image.)
The main reason for the shift is plain enough for anyone who’s been following the spill: BP executives acknowledge Hayward has blown it as the company’s face during the crisis. Svanberg, while defending the BP CEO, acknowledged the Hayward’s comments have not been helpful to the company’s efforts to control fallout from the disaster.
“It is clear Tony has made remarks that have upset people,” Svanberg tells Sky News. “This has now turned into a reputation matter, financial and political and that is why you will now see more of me.”
So the elitist Swede, who gave away three quarters of dividends and in so doing impoverished the small people British pensioners and American mutual fund investors while consenting to a $20 billion shakedown (yes, it was a shakedown regardless of how inarticulately and clumsily Joe Barton described it as such) during a private meeting with President Obama Wednesday to map out a strategy by which BP could help Obama get cap-and-trade passed and thus secure billions in government subsidies for their uneconomic windmill and biofuel projects and thus get back into the good graces of stylish leftists the world over, is now going to be the public face and the day-to-day CEO of BP now.
He doesn’t sound like an arrogant ass at all. What could go wrong with this?
If there’s any good news here, it’s that Tony Hayward is going to get his life back. It’ll be in the same shape as Louisiana’s Gulf Coast, but he’s getting it back.
6-17-10, 3:30 p.m. – Rep. Joe Barton has pulled back from his “shakedown” statement, apologizing if it’s been “misconstrued.”
We’re kinda lukewarm about what Barton said. He’s right to note that the $20 billion escrow demand from President Obama is extralegal; it violates long-standing principles of law. And that escrow in the hands of Kenneth Feinberg is an absolute joke as a “third party” administrator. Feinberg works for Obama; he’s his TARP pay czar. Obama has an established record of widespread abuse when it comes to giving his administration access to off-budget money, and that’s precisely what this is. This is a slush fund with virtually no safeguards keeping that money from being misappropriated and stolen by ACORN and SEIU just like every other Obama slush fund has been; while BP might be too slow paying claims, at least we can be virtually sure that BP is going to try to keep its money going to people it actually owes it to.
So from that perspective, Barton is right on the money to scream about what Obama has done.
But to apologize to BP? We can’t go there. Maybe it’s us, but BP caved to Obama on that $20 billion and waiving dividends for the rest of the year – and then agreeing to a $100 million slush fund to pay off Obama’s moratorium victims (a fund which even if it’s used properly, which it won’t be, would cover at best about 10 days of lost salaries as a result of the Obamoratorium), which is ludicrous – far too easily. We smell a big, fat European rat in this entire show being put on this week. And while Republicans like Barton should stand for the rule of law and rightly oppose with justifiable outrage the absolute crass incompetence of this administration, they should not do so on behalf of a rent-seeking foreign-owned corporation with a shameful safety record which has been engaging in meddling in American politics in an attempt to shackle us with cap-and-trade and donated some $70,000 to Obama’s campaign.
BP is not our friend, and BP doesn’t deserve a break from us. We should be reasonable in our expectations of them as they attempt to stop the leak and we should recognize the logistical difficulty involved in building a response to something this big. And we should oppose public grandstanding that damages BP’s shareholders beyond what’s necessary – since 39 percent of their shares are owned by American investors. And we should defend the rule of law to the utmost, particularly when Obama has raped it and left it on the side of the road as he has in this case.
But not on behalf of a company whose board president demeans everyday Americans as “small people,” and not on behalf of a company which bribed the government into looking the other way as it cut corners on safety and hasn’t come clean about its actions since. And certainly not on behalf of a company which spent millions of dollars to lobby the federal government for subsidies of uneconomic alternative-energy boondoggles when those funds could have been used on industry best practices to avoid accidents like the one which killed 15 people at BP’s Texas City refinery in 2005 or the Deepwater Horizon fiasco and its 11 victims.
Barton’s statement was an example of a good thought horribly executed. On balance, a mistake – and one which obscures the message of dissatisfaction and outrage with what he correctly described as an extralegal shakedown.
6-17-10:15 a.m. – Our thinking on this entire saga is evolving very quickly, as BP’s quick capitulation on the $20 billion escrow to be administered by Obama’s “pay czar” as a third party gives off a strong odor of collusion and calls things into question we haven’t looked at yet.
So while we would have agreed with Joe Barton a day or so ago when he apologized to BP CEO Tony Hayward this morning for Obama’s “shakedown,” we’re no longer convinced. See below for the video.
6-17-10, 12:30 a.m. – Oooooh, I’m hot.
I’m red hot. Straight out of the oven hot.
I’m on fire because while it was on TV earlier today, I had the sound down and didn’t catch Carl-Henric Svanberg, this pinhead Swede, this blue-blood rent-seeking Cap-and-trade sluicebag, this corporate limousine liberal, call the people of the Gulf Coast the “small people” the company cares so much about.
But now I’ve seen it. And the arrogance and noblesse oblige of this man and his faltering, festering, malfeasant firm is more than I can bear.
Since this entry won’t contain much hard news, you can read up on what this gilded imbecile said here.
But in case you missed it as well, here’s video…
Hey Svanberg, you might have small people in that snowed-in suckhole you live in. You’re a European, after all, and throughout your continent you’ve accepted dictators, warlords, monarchs, spoon-fed nobility, theocratic despots and the tyranny of petty bureaucrats such that you wouldn’t know the first damn thing about what real freedom truly is.
But here in America, we don’t have “small people.”
Our forefathers bled and so have their progeny through the generations – and so have the millions of us whose ancestors rejected mediocre, closed little societies like yours in favor of a New World unshackled by your tyranny – so that none of us are “small people.”
We stand astride the world as a beacon for freedom, for unbridled prosperity, for human rights and for the betterment of mankind in ways that decadent and increasingly dhimmified Swedes like you wouldn’t have the stones to comprehend. We’ve made more significant contributions to humanity in a little over 200 years than your insignificant society has in two millenia.
Your country was neutral during the Cold War, for Christ’s sake – you either couldn’t understand the difference between freedom and communist tyranny, or you didn’t have the balls to take a position.
So don’t you dare address us as “small people.” You don’t have that right.
Perhaps I’m being too harsh on this man. Perhaps its his command of English that’s lacking rather than his respect for the people his slovenly, negligent and corrupt firm has grievously injured. Maybe he meant something else and didn’t have the words to express it. But if that’s the case he still doesn’t have an excuse. If you can’t speak the language worth a damn, then shut the hell up. You people have already run your mouths enough for a lifetime without offering one bit of positive achievement since your dysfunctional operation on the Deepwater Horizon destroyed our Gulf.
Did he think belittling his victims while expressing his love and paternalism was going to win us over?
Go back to Stockholm, you pussified plutocrat. And stay out of our politics. You people have done quite enough already. This blog has taken your side for two months in an attempt to provide some perspective and ward off the lynch mob. That is over. You’ve done the impossible. You’ve made it look like Obama was right about you.
6-16-10, 6:00 p.m. – Louisiana Gov. Bobby Jindal put out a rather long statement this afternoon on the sand-berm, oil cleanup and Obamoratorium issues. It’s a pretty informative piece – some highlights follow:
Governor Jindal said, “We saw the operations underway on the Northern Chandeluers today. It was a great sight to see these barrier islands being enhanced to protect our interior wetlands from the oil that continues to surge toward our coast. We are absolutely in a war to protect our way of life and seeing all of the supply ships and the huge dredger operation out there blowing sediment to create sand boom shows just how intense our efforts must be in this battle. Thankfully, we finally prevailed in getting this segment and five others in our 24-segment sand boom plan approved by the Corps of Engineers and the Coast Guard, and funded by BP, after fighting red tape and bureaucracy for many weeks.
“The Great Lakes Cutterhead Dredge, called the California, arrived onsite this past weekend and began initiation procedures, safety protocols, and hookup of floating flexible discharge pipes between the dredge and the discharge pipe. Over ten support vessels, including barges, crew quarters and ferries have been mobilized to the site. The California is dredging and moving an average of 54,000 cubic yards of dirt a day. Thus far, 108,000 cubic yards of material have been placed as the beginning base for the barrier berm. We can already see the beginning of the above water segment of the berm beginning to form. Dredging has also begun on the west side of the Mississippi River – with the Stuyvesant dredging Cubit’s Gap in the mouth of the river and moving the material toward site W9, Pelican Island.
Jindal said eventually the state will have over 150 vessels, including 10 dredges, working at the same time on the six segments of sand barriers – which would be one of the largest projects of that type in American history. He said 40 miles of sand berms will protect 2,000 to 3,000 miles of tidal shoreline.
Then he turned to Obama’s speech last night..
“I was glad the President took time to address the spill last night and bring national attention to our ongoing needs. The bottom line is that we know the President is good at speeches but we need the federal government to understand that we are in a war to protect our way of life. What we want is results – we want them to show us that failure is not an option.”
“DSS Secretary Kristy Nichols sent a letter this morning following up on the President’s announcement that he is bringing in a third party organization to ensure all claims from this disaster are paid. This announcement seems like a good step forward in a process that has been very frustrating to date. The state has requested access to BP’s claims database and procedures for weeks now and we have received only drips and drabs of information from BP. Their claims system absolutely needs to be reformed and whatever the final system is, the state must be assured full and complete access to the claims system in order to ensure our people’s claims are being handled fairly and quickly. We are also concerned that around 75 percent of small business claims being turned into the SBA are being rejected and we are asking the SBA to improve their process so our people are getting the help they need while their businesses are suffering from this spill.
“Again, no one in Louisiana wants a claims check from BP or an unemployment check – I want to be clear on that point. All of our workers and businesses would much rather go back to work. We want BP to clean up this oil and restore our water and our marshes to their healthy and productive status before this spill. But, the losses for many have already been significant and we will absolutely ensure that BP is held responsible for every loss associated with this spill. In particular, we are asking federal officials how this new independent claims process will be established, how it will operate in conjunction or away from the current system, and what degree of transparency it will have to ensure the state has access to claims information.
Jindal wasn’t impressed with Obama’s suggestion of getting Navy Secretary and former Mississippi governor Ray Mabus to run a study group on the Gulf Coast…
“Last night, the President also mentioned that he was calling for a long-term study to restore our coast. We’ve had many studies throughout the years and we are sharing with federal officials an outline for rebuilding coastal Louisiana. More important than studies, again, is action. We already have $9 billion in projects authorized by Congress. We need to move forward on projects, not have another study. We also need to get our fair share of OCS drilling revenue, just as many states get for on-shore drilling. Making OCS revenues for off-shore drilling match the current formula for on-shore drilling would be a tremendous help in giving us the funding we need to restore our coast. We also support our delegation’s efforts to speed up revenue sharing with the state to allow us to restore our coast.
Then he got to the Obamoratorium…
“On the drilling moratorium, the President did not announce an expedited process as we had hoped he would – which could save tens of thousands of Louisiana jobs that the six-month, or longer, deepwater drilling moratorium threatens. We are worried that the Administration still doesn’t understand that this moratorium is a job-killer for our state. This is about our jobs, our economy, and our way of life. Lt. Gov. Scott Angelle is in DC today meeting with Secretary Salazar and ask him to listen to his own experts – the eight out of 15 of his own scientists who studied this issue and are against the six-month drilling moratorium.”
Jindal then noted that federal red tape is still screwing up efforts to remediate the spill.
During the press conference at Fort Pike today, Governor Jindal expressed concern about a recent move by the Coast Guard to shut down vacuum barge operations so barges could be inspected and certified with the Coast Guard. The Governor said, “I brought this up on the White House conference call this morning and stressed that we were very concerned about any pause in these operations that are actively removing oil from our shores and our marshes. The federal government needs to do their inspection and certification process quickly and ensure these barges operate safely. We cannot afford to lose weeks or even days in our war against this oil.”
The Governor also stressed again the need for a quick resolution on Grand Isle Mayor David Carmadalle’s plan to narrow the five passes into Barataria Bay and protect the interior wetlands there. Mayor Carmadalle continues to work to get the Army Corps of Engineer’s final approval for the rock and barge plan.
One wonders if the president is capable of embarrassment, having taken credit for Jindal’s sand-barrier plan (75 percent of which, as Rep. Steve Scalise noted on Hannity last night, has still not been approved) while at the same time impeding the efforts to use vacuum barges to siphon oil from the coast and sinking barges to help fill holes in barrier islands.
6-16-10, Noon – 58 days, 20 minutes.
On the 58th day after the Macondo well blowout, President Obama met with BP’s executives for 20 minutes. That’s it.
In that meeting he was able to extract agreement from the company to put up a $20 billion escrow account that Kenneth Feinberg, who handled disbursements of insurance settlements to 9/11 victims, will manage.
This might work. Or it might entail trying to staff up another operation to pay claims after BP spent two months trying to do that. In other words, what guarantees do we have that starting over is going to make things better or get money to the victims any faster?
We’re not convinced. We smell FEMA, circa Katrina. And God help Obama if he makes this worse by sticking his nose in it.
UPDATE – Ben Stein calls Obama the Caudillo President, seeing as though he has zero legal authority to demand BP escrow those funds. And we neglected to mention that Feinberg is Obama’s “pay czar” who thinks it’s OK for the federal government to cap salaries at $500,000 per year for Wall Street execs; while the TARP debacle is a completely different animal than BP claims are, if this guy starts trying to impose social judgements on who should get what based on his concept of fairness rather than the merits of the claim, it’s going to be a mess of gargantuan proportions.
6-15-10, 2:00 p.m. – Now the collection efforts have been suspended, thanks to lightning hitting the Discoverer Enterprise this morning, which started a fire that was, thank God, put out quickly. Considering that the Enterprise is the ship attached to the collection cap and it’s that ship flaring natural gas to the tune of a 200-foot jet of fire over the side, the temporary shutdown probably came as a result of a collective heart attack as likely as anything else.
They’ll be back at it this afternoon.
We’re now splitting our Gulf spill updates into two threads going forward – this one will focus on efforts to stop the spill at the source, while another thread starting today will cover the Obamoratorium and the devastation it wreaks on the economy of Louisiana. For previous updates on the spill, click here for updates from June 1 to June 14. Also, click here for updates from May 26 to June 1. For updates dated from May 16 to the early morning hours of May 26, click here. And for older updates prior to May 16, click here.
6-15-10, Noon – Kevin Costner is now officially a hero of the Gulf oil spill, as BP has tested his centrifuge machines and found that they work. They put in an order for 32 of the suckers (not a colloqualism; that’s what they actually do) and at long last they’re going to use them to siphon up some of the oil they’ve been spewing into the Gulf.
Better late than never, eh?
In other spill-related news, ABC News also reports that BP’s safety record is hideous and far, far outstrips that of the rest of the oil business – so much so that it gives the industry a bad name. That’s consistent with the narrative coming out of a document dump by the House Energy and Commerce Committee yesterday – a narrative described by the AP as a careless company which was behind on both time and money in attempting to get a “nightmare” well drilled and producing:
Meanwhile, congressional investigators have identified several mistakes by BP in the weeks leading up to the disaster as it fell way behind on drilling the well.
BP started drilling in October, only to have the rig damaged by Hurricane Ida in early November. The company switched to a new rig, the Deepwater Horizon, and resumed drilling on Feb. 6. The rig was 43 days late for its next drilling location by the time it exploded April 20, costing BP at least $500,000 each day it was overdue, congressional documents show.
As BP found itself in a frantic race against time to get the job done, engineers took several time-saving measures, according to congressional investigators.
In the design of the well, the company apparently chose a riskier option among two possibilities to provide a barrier to the flow of gas in space surrounding steel tubes in the well, documents and internal e-mails show. The decision saved BP $7 million to $10 million; the original cost estimate for the well was about $96 million.
In an e-mail, BP engineer Brian Morel told a fellow employee that the company is likely to make last-minute changes in the well.
“We could be running it in 2-3 days, so need a relative quick response. Sorry for the late notice, this has been nightmare well which has everyone all over the place,” Morel wrote.
The e-mail chain culminated with the following message by another worker: “This has been a crazy well for sure.”
BP also apparently rejected advice of a subcontractor, Halliburton Inc., in preparing for a cementing job to close up the well. BP rejected Halliburton’s recommendation to use 21 “centralizers” to make sure the casing ran down the center of the well bore. Instead, BP used six centralizers.
In an e-mail on April 16, a BP official involved in the decision explained: “It will take 10 hours to install them. I do not like this.” Later that day, another official recognized the risks of proceeding with insufficient centralizers but commented: “Who cares, it’s done, end of story, will probably be fine.”
The lawmakers also said BP also decided against a nine- to 12-hour procedure known as a “cement bond log” that would have tested the integrity of the cement. A team from Schlumberger, an oil services firm, was on board the rig, but BP sent the team home on a regularly scheduled helicopter flight the morning of April 20.
Less than 12 hours later, the rig exploded.
BP also failed to fully circulate drilling mud, a 12-hour procedure that could have helped detect gas pockets that later shot up the well and exploded on the drilling rig.
BP, meanwhile, is bringing in a fleet of ships to work on processing and lightering the oil from the well. The company admits that the current operation at the spill site is dangerous as hell, with 200-foot jets of flared natural gas shooting off drillships and live hydrocarbons everywhere. “Several hundred people are working in a confined space with live hydrocarbons on up to four vessels,” BP ops chief Doug Suttles wrote. “This is significantly beyond both BP and industry practice.”
If something goes wrong, there’s a risk of a “major surface accident.”
On shore, the response to the spill is becoming as much of a nightmare as the well is. The company has already spent $1.6 billion on the recorvery effort, including a “Responder’s Village” in Venice with trailers and port-a-potties everywhere – moving from “disorganized complexity” to “organized complexity” in seven weeks, according to Coast Guard commander Pat Eiland, who’s handling things in Plaquemines Parish. Since BP isn’t a claims-processing company, they’ve had to stand up a system to pay them and doing so is understandably slow. They’re trying to fight a PR battle on that, but losing badly. The fact that both the White House and the states – including Louisiana, whose treasurer John Kennedy has seized on BP’s solvency as a big issue to be made hay of – are hustling to get their hands on BP’s money in escrow and take over the claims process – doesn’t make it any easier. BP has lined up $7.5 billion in funds to pay claims in an attempt to ward off all the government moves, but that’s probably not going to be enough.
BP is probably doing a crappy job on these claims. The benchmark on paying claims in massive volumes, however, was set by FEMA after Katrina. By that standard it’s hard to criticize BP. And it’s worth asking whether anybody really thinks giving Barack Obama control of BP’s money to pay claims with would constitute an improvement. But that’s precisely what Obama is going to talk about tonight. Chief White House press flack Robert Gibbs:
On the matter of the disputed damage payments, Gibbs said, “We have to get an independent claims process. I think everyone agrees that we have to get BP out of the claims processes and, as I said, make sure that fishermen, hotel owners have a fast, efficient and transparent claims process so that they’re getting their livelihoods replaced.”
“This disaster has taken their ability to make a living away from them,” he said. “We need to do this quickly, and we have to make sure that whatever money goes into that — that in no way caps what BP is responsible for. Whatever money they owe to anybody in the Gulf, they’re going to have to pay regardless of the amount.”
He noted in one interview that Obama “has the legal authority” to make the claims process independent. And Gibbs said “the best way to prevail upon BP is to take the claims process away from BP.”
“The president will either legally compel them,” he said, “or come to an agreement with BP to get out of the claims process, give that to an independent entity.”