The oil spill and resulting moratorium and tighter regulations on the oil and gas industry may now be a drag on the US gulf coast region, but analysts say the longer-term impact is likely to be new business. Indeed, several already see the need for their expertise in the region.
The failing of BP’s blowout preventer in the disaster has presented an opportunity for C. Mark Franklin, founder of Innovative Pressure Testing, which has developed equipment to validate blowout preventer tests. The current industry standard – the circulator chart recorder – dates back to 1902, he said. A lot of time, that “antiquated equipment” takes 30 minutes to an hour to perform, and at very high pressures, which creates a safety issue. He notes in an interview:
It was a good piece of technology that suited our industry fairly well until it was taken into deeper water, higher pressure systems.
His new technology, which is being evaluated by Royal Dutch Shell and others, can identify leaks within a few minutes. Mr Franklin established his company in 2009 and began to offer the commercial software in March of this year – a month before the spill. Nonetheless, he believes the spill will focus attention on “100 year-old technology” being used and help to make his product “the new standard”.
Could it be that nobody in the US wants gasoline anymore?
On Wednesday, John Kemp of Reuters observed how the combined stock of crude oil and refined products in commercial storage around the US had surged to 1.130bn barrels — the highest level since weekly records began in 1990.
South Korea’s national oil company on Friday launched a landmark £1.87bn hostile takeover offer for Dana Petroleum, after shareholders owning almost half of the UK oil explorer offered their support. Miles Johnson, companies reporter, talks to Daniel Garrahan about whether KNOC will pay over the odds.
ExxonMobil said earlier this week it was giving up its attempt to get a stake in the Jubilee field that has been touted as a game-changer for Ghana. The share purchase agreement with Kosmos Energy had emerged last October, but it was met with fierce opposition by the Ghanaian government, which had been left out of the $4bn venture.
The US’ biggest oil company declined to explain its decision to terminate the share purchase agreement, noting Exxon does not discuss the details of commercial agreements.
But the reasons for Exxon’s withdraw are clear. Ghana’s interference in attempts to close the deal smack of the interventionist policies of oil-rich countries such as Venezuela. And Exxon has always been one to insist it plays by the rules or does not play at all. It is a policy that has cost the company access to key areas and money in the ground, when nationalization or some other change in policy leads to new rules.