Welcome to the ODAC Newsletter, a weekly roundup from the Oil Depletion Analysis Centre, the UK registered charity dedicated to raising awareness of peak oil.
Wednesday saw the release of BP’s Deepwater Horizon Accident Investigation report – the company’s version of the events that led to the explosion of the Deepwater Horizon oil rig. BP admits responsibility for some of the list of technical and human failures which it says led to the disaster, but also heaps blame on both the rig owners Transocean and contractors Halliburton. Both subcontractors claim the report contains inaccuracies. At stake are billions of dollars of additional fines should BP be found guilty of gross negligence, which is less likely if it can persuade the US courts that other companies were also at fault.
Also released this week were the results of an US Interior Department investigation into the agency in charge of off-shore drilling. The agency, formerly known as the Minerals Management Service and now as the Bureau of Ocean Energy Management, Regulation, and Enforcement, was found to have been overwhelmed, underfunded and often lacking in the training and expertise necessary to do its job. US Energy Secretary Ken Salazaar said that the report would be used as a blueprint to transform the agency. What this will mean in reality with regard to permits for increasingly risky oil exploration to greater depths and in the Arctic remains to be seen.
In the UK an Energy and Climate Change Select Committee hearing on deep water drilling heard evidence this week from Paul King head of Transocean. This coincided with the release of a damaging report about a culture of bullying and intimidation at the company. The UK oil industry argues that the US disaster shouldn’t mean drilling restrictions here as the regulatory and safety record has been strong. The latest round of North Sea oil blocks includes controversial deepwater blocks off Shetland. Despite industry assurances though recent Health and Safety Executive figures showed a marked increase in “major and significant” oil leaks which are regarded as “potential precursors to a major incident”.
BBC’s One Planet programme ran a feature on peak oil this week which included commentary from ODAC trustees Richard Miller and David Strahan. The piece also included an interview with IEA Chief Economist of the IEA Fatih Birol in which he described the situation as “definitely depressing, more than depressing, I would say alarming…” (see full quote on our Peak Oil Quotes page). There is nothing factually new in the interview, but it would surely be difficult for any government minister listening to this to conclude that it justifies a position that oil supplies are secure out to 2030.
Oil
BP Says Transocean, Halliburton Have to Share Blame for Gulf Rig Explosion
BP Plc, facing billions of dollars in damages and penalties for causing the largest U.S. oil spill, says its investigation shows other companies made mistakes that led to the Gulf of Mexico oil rig explosion.
BP managers had direct involvement in just one of the eight judgment errors and equipment failures that led to the April 20 explosion aboard the Deepwater Horizon drilling rig, according to the company’s internal investigation. The explosion killed 11 workers and spewed crude oil into the Gulf of Mexico for almost three months…
BP oil spill: after the human cost will come the cost of safer oil production
In the gloom of a Gulf night, 28 workers were either killed or injured as first mud violently and uncontrollably spewed on to the rig floor and then exploded skywards. All the time a great pressure was building beneath the sea floor forcing a fatal mixture of mud, sea water, oil and gas through the rig’s pipework and vents, eventually raining the awful cocktail down on to the heads of terrified workers. All this in the space of just four minutes – no time for calm reflection on how to handle the situation.
Yesterday’s report logs the inevitable panicked call that came next. “The well is blowing out,” by which time the 126 workers on the rig “were enveloped in a flammable mixture” and the noise that any drill operator fears most became audible – the dreaded hissing sound of gas escaping at high pressure. With terrible inevitablity the sound of ruptures gave way to the first alarm piercing the night air. Then a second alarm was triggered, then another, then another as the scale of the gas leak cloaking Deepwater Horizon was confirmed…
Offshore Drilling Agency Overwhelmed, Says Report
The federal agency that regulates offshore drilling rarely conducted unannounced inspections, allowed oil-rig operators to shop around for favorable decisions and gave its inspectors financial incentives for speeding up application approvals, according to an internal report released Wednesday by the Interior Department.
The report, by a panel of top Interior officials, shed more light on the extent of the problems at the Bureau of Ocean Energy Management, Regulation and Enforcement, formed from the agency formerly known as the Minerals Management Service…
MPs warned on deep sea drilling ban
Preventing the drilling of wells in the waters off the UK would send “a very negative message” to investors in the oil industry, the head of Oil and Gas UK, the industry body, has warned…
Oil Rises After U.S. Jobless Claims Decline, China Crude Imports Increase
Oil climbed to near a three-week high as economic indicators from the U.S. and Asia restored confidence that the recovery will stimulate fuel demand.
Oil was set for a weekly increase of 1.5 percent as U.S. jobless claims fell, Japan boosted its estimate of economic growth, and China increased imports of crude. Prices gained after a leak prompted Enbridge Energy Partners LP shut a pipeline that can carry more than one-third of oil to the U.S. Midwest…
BBC One Planet – Peak oil and happy cows
Type the phrase ‘peak oil’ into any popular internet search engine, and you will not be short of results to wade through.
Like the fuel itself, the topic generates a lot of heat and hot air. This week on One Planet, reporter Richard Hollingham seeks to define the term ‘peak oil’ before asking leading experts whether they believe the event is nearing…
Pricey Petrobras Oil Deal Removes Share Sale Hurdle
A deal between Brazil’s government and oil company Petroleo Brasileiro, or Petrobras, has removed some doubts that the company can pull off the world’s largest share offer later this month.
Petrobras and the Brazilian government reached a $42.5 billion agreement late Wednesday that gives the oil giant the right to produce five billion barrels of crude oil in government-held areas…
Gas
US test shows water problem near natgas drill site
U.S. government officials urged residents of a Wyoming farming community near natural gas drilling sites not to use private well water for drinking or cooking because of chemical contamination.
“Sample results indicate that the presence of petroleum hydrocarbons and other chemical compounds in groundwater represents a drinking water concern,” the Environmental Protection Agency said in a statement about tests of 19 water wells around the town of Pavillion…
Pa. Senate GOP writes Marcellus Shale tax bill
State Senate Republicans have begun drafting legislation for a sweeping overhaul of Pennsylvania’s oil and gas law that includes proposals for a new tax on the extraction of natural gas from the Marcellus Shale formation and limitations on municipal zoning that affects drilling.
Senate President Joe Scarnati said Friday the GOP plan is a sincere effort to keep the pledge Gov. Ed Rendell and lawmakers made in this summer’s budget agreement to enact a severance tax by Oct. 1…
Electricity
Smart meters alone may not save much energy -study
Smart meters to boost energy efficiency in homes do not automatically achieve a significant reduction in energy demand, research showed on Wednesday.
Smart meters record energy or water consumption and send the readings back to the utility for monitoring and billing…
Residents, industries in uproar over power cuts
Residents and businesses in a county in Hebei Province are in an uproar over a measure taken by the local government aimed at reducing emissions by regularly cutting off power supplies.
China National Radio (CNR) reported Sunday that Anping county began limiting electricity supplies to local residents and industries on August 27 in order to achieve power consumption targets set by authorities under the country’s 11th Five-Year Plan, which stipulates that carbon dioxide emissions from 2006 to 2010 should be reduced by 1,500 million tons…
German energy watchdog wants faster grid expansion
Germany’s renewable energy future hinges on the fast expansion of power transmission grids, but planning authorities are dragging their feet, the head of the country’s energy regulator said on Monday.
“Many of the planned lines are waiting in local queues, among them ones that have priority,” Matthias Kurth of the Bundesnetzagentur (BnetzA) told reporters during an energy conference…
Flexitricity aims to bolster power grid
A Scottish start-up believes private industry can make millions of pounds annually, and help reduce the UK’s carbon footprint, by selling spare electricity to the National Grid.
Flexitricity has patented technology that brings together the capabilities of standby generators, combined heat and power units and heavy users of power such as commercial greenhouses, cold stores and distribution centres…
Nuclear
Germany agrees to extend life of nuclear power stations
The German government today agreed to extend the working lives of its nuclear reactors by an average of 12 years, in a controversial move that will shape the energy strategy of Europe’s largest nation for decades to come.
Having put the seal on a deal that was hammered out after lengthy talks between politicians and power companies, the German chancellor, Angela Merkel, hailed it as a “revolution in energy provision”. She said it would help to ensure Germany’s place at the forefront of “the most environmentally and worldwide most efficient” energy policy…
‘Floating Chernobyls’ to hit the high seas
“Floating Chernobyls-in-waiting” are coming to a sea near you after a major international agreement was signed last week, according to critics of nuclear power.
China and Russia agreed to expand co-operation over nuclear power, specifically on uranium exploration and safer power plants – but also on floating nuclear reactors…
Renewables
Alex Salmond unveils plan to turn Scotland into ‘world’s first hydro-economy’
The state-owned utility Scottish Water is to be given new powers to build windfarms, hydro schemes and “green” power stations in partnership and competition with established energy companies.
The company, one of the country’s last remaining state-owned firms, could generate £300m or more in extra revenues by using its 80,000 acres of land and vast pipe network for renewable energy projects…
UK ‘heat pumps’ fail as green devices, finds study
Government plans to subsidise green heating are challenged today by the largest ever field study of “heat pump” devices in the UK, which reveals 80% perform so badly they would not qualify as renewable energy under proposed European standards.
The report, from the Energy Saving Trust, reveals the prevalence of badly installed heat pumps that are consequently under-performing. The controversial report could affect the government’s plans to launch its Renewable Heat Incentive (RHI) next April to pay householders for generating heat from such “green” ground and air source heat pumps. There are already fears the RHI could be a victim of spending cuts announced next month…
China Supplants U.S. for First Time on Renewable-Energy Investor Ranking
China overtook the U.S. to lead a quarterly index of the most attractive countries for renewable energy projects for the first time, according to a list compiled by the global accounting firm Ernst & Young.
After sharing the lead with the U.S. in the first quarter, China moved ahead of the world’s largest economy to rank as the most appealing nation for investing in wind and solar power projects, according to the report released today. The move follows the failure of U.S. Congress to pass legislation that would have required utilities to use clean energy…
Severn green energy project loses government funding
The government will this month sound the death knell for the world’s largest tidal energy project – to be built across the Severn estuary between Somerset and south Wales – when it rules out public funding for the controversial £20bn plan.
The announcement will please some environmentalists, who were worried about the impact on bird life in the estuary, but others say such spending cuts will make a mockery of David Cameron’s pledge to be the “greenest government ever”…
UK
Britain’s energy challenge: meeting energy generation and carbon emission targets
Energy policy in the UK is at a crossroads, and the decisions made now will reverberate for decades. At least 43 gigawatts of new electrical generation capacity, equivalent to half of Britain’s current total, will be needed by 2020, as all but one of its nuclear plants are retired and coal-fired power stations closed to meet EU air pollution standards.
A staggering £200bn of investment will be needed not only to maintain energy security against price spikes as North Sea resources dwindle and energy imports grow, but also to deliver the largest single contribution to a low-carbon economy…
Urban development – global solutions
The ways cities around the globe can make themselves smarter are as varied and multi-layered as the different sizes and shapes of the world’s urban areas.
Cities face different problems. For one it might be dealing with transport, or crime, while for another sustainability, or streamlining public service provision and access to technology for all, might be important. There is no one-size-fits-all model…
Rising wheat prices raise fears over UK commitment to biofuels
The soaring price of wheat has raised questions about the UK’s commitment to biofuels as it attempts to wean itself from its dependence on oil.
A network of biorefineries that convert wheat and other crops into bioethanol that can then be blended with petrol are being developed as the UK looks to meet its EU renewable transport fuels obligations…
Climate
Greens Seek `Fast, Furious’ Movement on Climate Under Gillard Government
The Australian Greens plan “fast and furious” action to establish a climate change committee and impose a price on carbon emissions under a government led by the Labor Party’s Julia Gillard.
“This is the best political opportunity collectively we’ve ever had,” Christine Milne, deputy leader of the Greens Party, said in Sydney today before Gillard won the support needed to form a government. With Labor retaining power, “this committee will be on track fast and furious,” Milne said…
A carbon border tax can curb climate change
As global growth picks up after the economic crisis, carbon emissions are going back up too. With China and India back on track to double their gross domestic product every decade, and with coal providing nearly 30 per cent of global energy, the chances of stabilising and reducing emissions are low. Indeed, little progress has been made in the last two decades. Only recessions lower emissions – and then only for a short time.