Sheila McNulty Mariner’s explosion in gulf bolsters case for moratorium

For the oil and gas industry, the timing of Mariner Energy’s explosion in the Gulf of Mexico on Thursday could not be worse. The day before, about 5,000 members of the industry had gathered in a convention center in Houston to call for the lifting of the moratorium on new deepwater drilling in the gulf and to protest against proposed taxes and other measures.

The industry’s point was that deepwater drilling creates jobs and benefits the economy at a time when the country desperately needs more – not less – jobs and economic investment.

Yet the government’s point has been that, above all, the industry must operate safely. The Macondo well incident has raised questions about whether the industry could be operating more safely in the gulf. And while the majors contend that they are safe and would not have had the accident BP had, the Bureau for Ocean Energy Management says it must ensure that is the case. The moratorium is giving the government time to determine what must be done to ensure best practices across the industry.

Those at the rally did not seem to see why it was necessary to stop work in the gulf until improvements are made. One accident should not blacken a record that has been, by any measure, very good over the long term. John Hofmeister, former president of Shell USA and now head of Citizens for Affordable Energy, a nonprofit, told the crowd the US does not shut down the airline industry after accidents and should not shut down the oil and gas industry after the Macondo one.

The point received wide applause in Houston. But now there have been two incidents in the gulf – one in deepwater (BP’s) and one in shallow (Mariner’s), one on a rig (BP’s) and one on a production platform (Mariner’s). The case for higher scrutiny has just gotten a little better.