Thursday, May 27, 2010

BP

This oil spill has been awful and perhaps an interesting lesson in many ways.
I think the most interesting reflection on it comes from a post by Steve McIntyre at Climate Audit, which I suspect few have read as that blog is at best marginally about oil spills.
In the post McIntyre cites BP's VP for Deepwater Development in the Gulf of Mexico:
These are new challenges for the industry, and challenges which are being addressed at an ever-increasing pace. We find ourselves designing floating systems for 10 000 ft of water depth before the lessons of working in 6000 ft have been fully identified. And these new challenges are not just depth-related. Failure mechanisms, such as fatigue, driven by vortex-induced vibration (VIV) and vessel motion, are time-dependent and may take years to become apparent. The same is true of equipment reliability. We know the premium associated with hardware reliability is high, but at this stage, operators still have a limited failure database for forecasting the required levels of intervention in ever-deeper and more remote environments.
He clearly knew this might be a step too far; that nobody knew how to deal with the utterly predictable blowout. Regulatory authorities must have known as well; great job they did.
Of course as we speak it may be that BP is now finally figuring out the answers to some of these questions; we shall see, and I sure hope they do. There is no question the US Federal Government has proven it has nothing useful to add.
The BP Veep put this really well:
In particular, be rigorous in front end loading, and very clear about the scale and nature of the “size of the step” you are seeking to take. Recognize that what may initially appear to be an incremental change can often turn out to be much more profound. Develop multiple contingency plans. And be prepared to work closely with suppliers to drive up reliability and reduce risk.
This whole problem was, as he points out, created utterly at the front end, with the connivance of the government.
McIntyre follows with another thing I like about him - the quant wants a gut feel for the spill rate and asks for a very simple piece of data:
In order to get 5,000 barrels/day, you would have to have a discharge velocity of 0.1 mph instead of my friend’s guess of 2 mph or a smaller effective pipe diameter. [See update below as this latter seems to be the case, though not down to 5,000 bbl/day. Looks like 15-20,000 is more probable.]
I wonder how they arrived at their estimate of 5,000 barrels/day. Maybe their Group Vice President, Research and Engineering should have spent more time trying to figure this out and less trying to hide the trick to hide the decline.

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