Transocean semi fire in BP's GoM operations

Davjo

I hope so too. I'd like to see Hayward come off the ropes swinging and landing a fair few hefty blows on Berk's MMS and Transocean having been playing "rope a dope".

There's plenty of ammunition if needed, let's hope he uses it, especially after Berk's speech just now.

What a speech! He's a hell of an orator. Not so good when its not prepared though.

"BP's reckless" and "I will inform them what they will pay".

So there's the proof - judge jury and executioner. No wonder so many are now saying that his hyterical ranting is unconstitutional.

He knows that he's been caught with his pants down and boy is he flailing around trying desperately to deflect some of the flak. He knows he's toast at the end of this year. In some respects its sad. If only he had started to push harder on a new energy policy beforehand. Maybe that will be his greatest legacy?

Is it possible for BP to argue that as they already had another rig standing by to develop the well for production as soon as the Transocean left, the choice of choosing to install a single string of casing instead of a liner and tieback etc was a made to cover the short period of the changeover between the 2 rigs, and that the points made in the letter are only fine if BP intended to leave the well unattended for a period of months? And so MMS approved this "temporary fix" as the production rig would cover these points.

In reply to alano20, post #407

Hi alano20

Is it possible for BP to argue that as they already had another rig standing by to develop the well for production -choosing to install a single string of casing instead of a liner and tieback etc was a made to cover the short period of the changeover between the 2 rigs

Unfortunately not. Choosing a single string by itself is hardly a problem and for the other oil companies to now turn around and say that they would not have done it this way is a bit rich. The problem that Haywood will have to address is that having made the decision to run a full string and knowing that the formation had been subject to previous losses (no hindsight excuses here) then the cement procedure should be robust and tested (cbl etc) afterwards to prove the cement was where it was supposed to be and confirm a regulatory barrier. 

And before someone comes along and blames Transocean for supplying and running the wrong casing I should point out again that the casing and landing rings, floats etc would be supplied to Transocean by the owner of the items - BP and directed to be run into the BP well by BP.

passinthru

In reply to passinthru, post #395

Hi passinthru

'Intercept' usually refers to milling a hole in the steel casing wall and then pumping mud/cement to kill the flow. A tricky operation and a bit hit and miss...the relief well might just target the reservoir in the first instance and pump merry hell with mud to starve the flow from the reservoir into the casing annulus...and then to the BOP.

I think you're probably right. I can't see them intercepting the well at that in a month of Sundays.

Is ther any significance in having two holes being drilled - othr than just straightforward redundancy? I'm wondering if, assuming the plan is similar to your suggestion, the idea might be to get a 'doughnut' of heavy mud around the initial well to kill it.

(I wonder what the mood is like on those other two rigs...)

SW10

Lots of focus here on the drill string/casings/cement job. However let's not forget this is a contributing factor. Other factors include failed BOP and ingnition on the rig itself possibly by poorly maintained engines.

It seems to me that there are a lot of conspiring factors which all resulted in this terrible disaster. I would hope that a balanced enquiry will not show that any of these particular steps alone caused the problem and thus hopefully BP will not be found grossly negligent.

I guess it will take a long time to play out though and BP will be under a clound for some time to come.

Log

In reply to davjo, post #405

Since Hayward's evidence before Committee is very likely to be an sp moving event, I very much hope he puts in a barnstorming performance

Leaving politics and all else aside, this is how you address a US Senate Committee and turn around ill-prepared inquisitors.

SW10

LONDON (SHARECAST) - From his desk in the Oval Office, President Obama demanded last night that BP hand over control of compensation payments for the Gulf Coast oil spill and challenged America to break a century of addiction to fossil fuels to ensure that such a disaster never happens again.

Personally I'd rather BP kept hold of control over compensation as there's no telling how lax Obama would be in making payouts(without due diligence) to those claiming to be affected - there's nothing like being generous with other people's money! And as a Democrat, a notably left leaning one, with important elections coming up I'm sure he'd be unable to resist handing compensation out willy nilly.

I've done a bit of work trying to work out the size of the total spill and how (in)effective the efforts to contain it have been and I've come up with a basic model. I've done three scenarios one (best case) where the flow rate is 35,000/day and used a modest fine of $1,000/barrel spilt (assuming non gross negligence). Another worst case 60,000/day and $4,300/barrel fine and lastly mid-case 35,000 flow and $4,300. I've taken into account captured oil so far and also an increased capture rate (starting today) of 28,000/day. I've also taken into account burns/skims so far and assumed the same going forwards is achieved.

Clearly the worst case might also mean none of the liabilities are shared with other partners so that would be terrible indeed. The other two cases if no gross negligence is found would be further reduced by 35% and so don't seem particularly terrible.

Interestingly if I've got my numbers right the burn/skim process is pretty effective (I've assumed 20%/80% oil/water in the skim). They actually capture 6K/day+ in oil.

Also something I'm not sure about is if these flow rates from the flow rate estimate team include gas or are just oil. If anyone knows the answer to this it would be most useful.

Even if you add in $20Bn for other claims from affected industry and take worst case we are only up to $40bn which over five years and reduced by tax is horrific but it should not mark the demise of BP.

Best case:

Mid case:

Worse case:

Great piece of work Log. Thanks for that.

I think what most people seem to be forgetting, and this is as a direct result of Obama's partisan rhetoric, is that not only is BP only a 65% owner(Andarko & Mitsui own the other 35% so surely will be footing some of the bill!), but Transocean, as owner and operator of the destroyed rig, itself with a patchy safety record, will also be faced with costs, surely.

Why is it that no one in the press seems to have adequately researched this - Transocean is at the centre of this whole sorry episode yet they seem immune to any White House criticism whatsoever.

Whilst the costs will be high for BP, I doubt they will have to foot 100% (and frankly I'd consider it criminalm if they had to) when there are so many other players involved in this sorry episode, and those that are due will be payable over several years. Obama's demand for $20bn upfront now seems to smack of little more than wanting to bankrupt BP by imposing ridiculous short term liquidity pressures on a sound asset backed behemoth. It's just a pity the majority of the American populace are so misguided as to have fallen for his blatant biased spin.

Value will out eventually but this looks like being a long term game.

If a USD20 billion slush fund is to be formally set up - does this mean that 35% of the 20 billion will be contributed by the partners? If so does Anadarko have a couple of billion available?

From what Obama is saying this $20bn slush fund is to be solely funded by BP as it is only BP he is focusing on!

Which is ridiculous given the involvement of all the other parties and shows how little interest he actually has, despite his protestations to the contrary to Cameron, that he is playing with a straight bat on this - absolutely no mention of all the American companies involved in this - Transocean, Andarko, etc

Very telling imv. Obama simply isn't to be trusted to be objective, and there's absolutely no way I'd want his biased mitts controlling the compensation fund.

I think I'm right in saying if BP are found to have been grossly negligent then there is quite a bit of wiggle room for the other partners. The recent whitehouse five point attack on BP looks to point that way but BP have yet to tell their side of the story.

Anyone know if the flow rate team are including gas flow yet?

Also I'd like to get some idea of how much oil will have evaporated by now to put in my model (I think they will still be fined for that but worth knowing). Should be quite a bit I think but I don't know how to measure this.

Log

In reply to loglorry, post #417

Does that wiggle room extend to Transocean, the owner and operator of the rig in question with an equally dodgy safety record Log?

Still surprised no vocal criticism that transocean are paying a dividend($1bn) from Obama who is still demanding that BP forgo paying theirs! Perhaps I missed it. But the cynic in me says that Transocean are getting away with it because they are an American company;.....

I don't think this has been posted before. Fascinating interim report issued by BP providing lots of technical detail about events over the final days, hours and minutes. It would be great if our resident pros can glean something useful from this. One thing I did note, the blind shear ram in the BOP was apparently working on the morning of the fateful day, since they closed it during one of the operations. I also note the well started flowing 51 minutes before the explosion, so wonder whether any mistakes were made during that period which may have contributed to the outcome?

Deepwater-Horizon Interim Incident lnvestigation - May 24th
http://energycommerce.house.gov/documents/20100527/BP.Presentation.pdf

There's also a presentation on the incident from Transocean dated 8 June :-
http://tinyurl.com/2wgtt44

Just to tag onto the above.....memo from the Committee commenting on BP's presentation :-

http://energycommerce.house.gov/documents/20100525/Memo.BP.Internal.Investigation.pdf

Four hours before the explosion, during efforts to begin negative pressure testing, the system gained 15 barrels of liquid instead of the 5 barrels that were expected, leading to the possibility that there was an “influx from the well.” A cementer witness stated that the “well continued to flow and spurted.” Having received an unacceptable result from conducting the negative pressure test through the drill pipe, the pressure test was then moved to the kill line where a volume of fluid came out when the line was opened. The kill line was then closed and the procedure was discussed; during this time, pressure began to build in the system to 1400 psi. At this point, the line was opened and pressure on the kill line was bled to 0 psi, while pressure on the drill pipe remained at 1400 psi. BP’s investigator indicated that a “fundamental mistake” may have been made here because this was an “indicator of a very large abnormality.”

Very interesting article davjo. Suggests maybe the Transocean guys were not following the drill plan proposed by BP perhaps? T

here are so many factors and parties involved here it is very hard to see what is going on. Many of the big five points raised by the senate enquiry seem to be mitigated by the fact that the MMS signed off on them beforehand for example. It seems it will be a long time before some kind of conclusion is reached in this regard.

Log

Ignore - just double posted the Transocean update report  - see Davjo's post above.

Thanks for posting the articles, davjo. Very interesting, though heavy going for the non-expert.

Concerning "lessons to be learnt", I observe that Macondo was originally an explo well. On success, BP decided to suspend the well as a possible future producer. I note from comments on other threads that more and more companies are reaching the conclusion that it is more cost-effective to re-drill offshore production wells & P&A the explo wells (e.g. Soco's next TDG well), rather than trying to re-enter at a later date.

I wonder whether attempting to suspend an explo well for later re-entry adds an extra dimension of risk? I guess that the design & drilling plan for a production well would be somewhat different from that for an explo well. A key point being that the downhole conditions for an explo well are  unknown & hence, I presume, compromises must be made to deal with a variety of possible outcomes, whereas previous drilling would identify the conditions a development well was likely to encounter, so the latter well type can be designed to cater specifically for those conditions, with a good margin of safety.

The bottom line is, would it be sensible to prohibit the use of offshore explo wells for production purposes and require development wells to be drilled separately? Also, from previous comments from experts, I gather this might not add as much to costs as one might first think, if anything. Surely it is simpler to plan a well that you know is going to be P&Ad, where the only priorities are 1. safety and 2. data gathering, without having the added complexity of 3. making the well suitable for production?

Regards,

Mark

hi mark

(back home again after a very late night courtesy of EJ Abz)

re your point in connection with the pros and cons of permanently P&A'ing successful wells vs suspending them for possible future use as producers....

about 20 years ago I was involved in a major cost reduction exercise for the upstream side of a major integrated oil co. At that time their normal practice was to do "temporary" closures on successful(ish) wells so that they could be re-entered as producers if subsequent analysis so decided. Typically a decision about re-entry would not be made for a long time - often several years. Problem was that after such an interval it was a non-trivial exercise just to relocate the temporary well-head In many places the sea-bed is not static and layers of silt and sand get deposited over the top of the temporary closure making it difficult to locate and re-enter.

The key point was that if you decided NOT to re-enter and re-use for production, you still had to go back and do stuff to the temporary closure to upgrade it to a permanent closure.

We looked at the percentages and concluded that it would save money if every explo well were permanently sealed as a matter of routine. Sure some wells would then end up getting re-drilled but taking the costs of the whole thing into account it was actually cheaper to seal everything permanently and accept a small amount of redrilling, rather than messing around having to go back to every temporarily sealed well years later.

So, what you said, basically, except that it might even save money...

Going through the information in BP's presentation and the letter from Waxman to Hayward, a possible explanation is starting to emerge:

1. The cement job around the 7" casing was compromised by poor centralisation and failure to circulate and condition mud prior to cementing. Both of these are required as good oilfield practise, especially since the cement job was over a short interval which included a high-pressure gas-bearing reservoir.
2. After the cement job was completed the casing seal assembly was set (this seals the annulus behind the casing at the wellhead at sea level). The seal was pressure tested and held pressure. The casing was then pressure tested and held pressure. At this point everything appeared normal. However the cement job had probably failed to isolate the reservoir, allowing gas to migrate through the cement up the annulus behind the 9 5/8" x 7" casing. As gas is very light it means that reservoir pressure would then be transmitted up the annulus to the level of the wellhead (less a small proportion due to the hydrostatic head of gas).
3. The contents of the riser were then displaced from drilling mud to seawater in preparation for suspending the well. This reduced the hydrostatic head at the wellhead. As there was no casing lockdown ring installed the differential pressure across the casing hanger was enough to unseat the seal assembly and lift the casing into the BOP stack (above the seal assembly was only seawater pressure, below the seal assembly was virtually reservoir pressure).
4. Once the seal assembly was unseated and the casing lifted the gas behind the casing then entered the riser.
5. Once clean seawater was observed coming from the riser the returns from the well were directed overboard, so it was not possible to measure the volume returned, and there would have been no indication that gas was rapidly expanding up the riser.
6. At 21:30 the pump was shut down due to high pump pressure and observation of mud. Within 5 minutes there was an explosion - the gas would have hit the rig with violent force (the volume of gas would have multiplied around 800 times its original volume).
7. The EDS button was pushed but failed to seal the well. If the 9 5/8" casing hanger was across the BOPs then this would explain it. Likewise the AMF (Automatic Mode Function) could not close the shear rams after power was lost. With the casing hanger sitting inside the BOPs they would not be able to shear anything and it was impossible to stop the flow.

A lot of this is speculation and grossly simplified, but it does fit the facts reported and is logical. If this is what happened the guys on the rig floor never stood a chance. It also makes the comments about BP's recklessness justified and clears Halliburton and Cameron of any blame. The only question remaining is the source of ignition, but considering the volume of gas at the rig it would have taken only a small spark to cause an explosion, and I don't really see this as absolving BP of any responsibility.