More Safety in future Rig design and operation? More cost ?

The aftermath of the Deep Horizon rig explosion in the Gulf of Mexico has left a lot of lesson to be learnt for those in the offshore industry as well as those classification socities reviewing and approving the design and construction of rigs in various region in the world. For the majority of those who are non-offshore industry people, an oil well gushing uncontrollably into the sea for over two months seems bewildering and there still is no sign that BP, having mobilised many rigs and support vessels, is able to plug the powerful gush and luckily the recent Tropical Storm Alex veered away from the Gulf of Mexico oil spill Saturday but experts warned that strong waves and winds could still upset efforts to halt the environmental disaster.

For Americans, the accident has been catastrophic and costly, and for the offshore oil industry, the reputation has taken a severe hit. US President Barack Obama and his administration are also feeling a political backlash. The widespread pollution as a result of the gushing oil is wreaking havoc on the ecosystems of the Gulf and the livelihoods of affected Americans. Entire industries across the Gulf coast, from fishing to tourism, have been devastated. This makes the issue a political hot potato on top of everything else.

The political and regulatory fallout from this disaster will be analysed and discussed for many years, as happened following the Exxon Valdez oil spill some 20 years ago. New regulations to govern the industry are already in the works, and hopefully the commissions of inquiry and Congressional hearings will produce conclusions that will be helpful and instructive for the industry. But the question remains: how is it that the world's most powerful nation - with the most sophisticated scientific and technological resources at its command - looks so helpless in the face of an oil leak? It must be asked: is leaving the job of plugging the leak to just one company a satisfactory approach? It's high time the Obama administration considered the possibility that this is something BP cannot solve on its own. There is also the danger that as the bills mount, and its run of unsuccessful attempts continue, BP may just give up the ghost.

The option of pooling global resources and tapping the collective expertise of the entire oil industry should be seriously examined.

Meanwhile, for us in Singapore, the Deep Horizon rig disaster contains a cautionary lesson. We must remember that Singapore is not just an international maritime hub, but also the world's biggest oil rig builder. Keppel Offshore & Marine and SembCorp Marine together account for around two-thirds of the rigs built in the world currently. Our port and waterways are among the busiest in the world with most of the oil tanker fleet plying this route. Woe be the day when a manufacturing fault of a Singapore-made rig becomes the cause of a disaster elsewhere. Or when a major accident of a similar nature occurs close to our own shores as seen recently, the spill occurred when the Malaysian-registered tanker MT Bunga Kelana 3 collided with the St. Vincent's and The Grenadines-registered bulk carrier MV Waily in May2010 at the Singapore Strait about 13km to the southeast of the city-state's east coast.

Such minor spill have already created much inconvenience to shore lovers, sea-going businesses,etc.

The oil industry will continue to boom for several years yet. But as the Deep Horizon disaster has made clear, it is an industry exposed to unpredictable and enormous risks. The need for safety first cannot be overemphasised. And if that calls for tighter regulation here as well, so be it and we as rig builders in Keppel O&M will have to take a further step to look at our rig designs and what kind of possible prevention or pre-empt to the future possibility of repeat incident and upholding and sustaining the reputation of "world class" rig builder in the offshore business sector.


Mid July 2010, BP has halted the Gulf of Mexico oil leak for the first time after struggling to cap the well for three months, raising hopes yesterday that the worst oil disaster in United States history may finally be ending.


In London, BP shares were up after the latest development in a disaster that has cost the company US$3.5 billion (S$4.8 billion). Compensation for damage caused by the oil spill could reach 10 times that amount.

Mr Obama, who has encouraged, cajoled and outright ordered BP to stop the leak, welcomed the news as 'a positive sign' but reminded everyone that 'we're still in the testing phase'.

BP is hoping to choke off the oil flow from the well, estimated at between 35,000 and 60,000 barrels a day. But doing so from the top could force oil out in new leaks if the wellbore has been damaged.
During the tests, engineers will take multiple readings from the 9m capping stack placed on top of the wellhead on Monday to monitor the pressure inside. High pressure readings would allow the three valves to remain shut and the well would effectively be sealed, but low readings could mean there is a hole or holes somewhere else in the casing of the well where oil is escaping. After 48 hours, the engineers will open up the system again and begin capturing the oil through two surface vessels to allow a new seismic survey to be done, said the official in charge of the US response, Coast Guard Admiral Thad Allen.

A final solution is not expected before the middle of next month, when crews will complete the first of two relief wells, allowing the oil reservoir to be permanently plugged in a 'kill' operation.

The disaster began on April 20 when the BP-leased Deepwater Horizon oil rig exploded 80km off the coast of Louisiana, killing 11 workers. Two days later, the still-blazing rig sank to the bottom of the Gulf.


Oilwell Plugged