Explanation: More severe storms test aging US offshore oil facilities

A satellite image shows an oil slick after Hurricane Ida near Port Fourchon, Louisiana, United States on August 31, 2021. NOAA / Handout via REUTERS

HOUSTON, Sept. 7 (Reuters) – Stronger hurricanes threatening America’s Gulf of Mexico coast energy hub increase the risk of oil spills from damage to the region’s refineries, oil rigs and pipelines under -marines, according to experts.

On Monday, the U.S. Coast Guard said it was investigating nearly 350 reports of spills in and along the Gulf following Hurricane Ida. Federal and state agencies formed a task force to track the leaks and remedy the damage caused by the storms.

Underwater oil leaks caused by the storm off the coast of Louisiana highlight the dangers of aging and unused energy infrastructure.

“Extreme weather conditions and hurricanes don’t mix with offshore drilling,” said Sarah Giltz, marine scientist for the Oceana Defense Group. “Hurricane damage to oil and gas infrastructure is one of the main causes of oil spills.”

The US offshore regulator does not have a strong enough oversight process to keep offshore pipelines safe, according to a study conducted in March by the US Government Accountability Office (GAO). The report adds that the Bureau of Safety and Environmental Enforcement (BSEE) is also not properly addressing the risks associated with unused infrastructure on the seabed.

“If the pipelines decommissioned in place later pose a risk, there is no source of funding for the withdrawal,” GAO said in its report to Congress.

LOW SURVEILLANCE

Many production platforms installed in the 1960s and 1970s became uneconomic and were phased out during the 1990s. Decommissioned wells must be plugged and structures cut 15 feet below the mud line within a year. following termination of the lease.

But the offshore regulator “does not have a robust oversight process” on pipelines, dismantling of rigs or subsea leaks. study says. BSEE has offered to update the regulations, but little progress has been made so far, she added.

“This helped BSEE and its predecessors allow the industry to leave more than 97% of all decommissioned pipelines on the Gulf seabed since the 1960s,” the report said.

FINANCIAL INSURANCE

U.S. energy officials have sought to extend industry responsibility for removing unused infrastructure, especially after corporate bankruptcies. Regulators should demand higher insurance bonds from producers, officials said.

“We want to make sure that businesses are financially sound and that taxpayers are not burdened with these costs,” Walter Cruickshank, deputy director of the Bureau of Ocean Energy Management, said last month.

This week, offshore producer Talos Energy (TALO.N) led the cleanup of a leak near a former drilling site. The company said its pipelines had been pulled and the leak came from lines other companies had abandoned.

“It was important to mobilize and identify the source and contain the release to reduce safety and environmental risks,” said John Spath, senior vice president of Talos. “We will continue to work with local, state and federal regulators to make this happen.”

AGING OF PIPES

Energy companies have built 40,000 miles of oil and gas pipelines in federal offshore waters since the 1940s. Since the first well was drilled in 1942, approximately 6,000 structures have also been installed on the US side of the Gulf of Mexico, ranging from shallow water platforms to complex deep water installations.

Of these, some 3,500 structures currently exist, with more than 3,200 active and some 200 inactive, according to the National Oceanic and Atmospheric Administration (NOAA).

As of April 2019, there were 1,862 oil and gas platforms in the Gulf interconnected by hundreds of kilometers of pipelines, according to BSEE data.

“As pipelines age, they are more susceptible to damage from corrosion, mudslides and seabed erosion,” GAO said. “In addition, hurricanes can displace the pipeline over long distances.”

Reporting by Marianna Parraga in Houston and Nichola Groom in Los Angeles; Editing by David Gregorio

Our standards: Thomson Reuters Trust Principles.

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