Senate oil spill hearing: Statement of Elmer P. Danenberger III, ex-MMS

Statement of Elmer P. Danenberger III

Senate Committee on Energy and Natural Resources

May 11, 2010

My name is Elmer Danenberger.  In January, I retired after a 38 year career with the Department of the Interior’s offshore oil and gas regulatory program.  During my career, I served as a staff engineer in the Gulf of Mexico regional office, Chief of the Technical Advisory Section at the headquarters office of the U.S. Geological Survey, District Supervisor for Minerals Management Service (MMS) field offices in Hyannis, Massachusetts and Santa Maria, California, and Chief of the Engineering and Operations Division at MMS Headquarters.  For the past five years, I served as Chief, Offshore Regulatory Programs, with responsibilities for safety and pollution-prevention research, accident investigations, regulations and standards, and inspection and enforcement programs.

Since retirement, I have closely followed the investigation of the Montara blowout in the Timor Sea northwest of Australia and the ongoing Deepwater Horizon (DWH) blowout in the Macondo field in the Gulf of Mexico.  My comments to the Australian Commission of Inquiry may be viewed at http://www.montarainquiry.gov.au/submissions.html

In this statement, I will briefly comment on the history of deepwater drilling, the compliance and performance record with an emphasis on blowout data, and regulatory issues that have emerged since the Macondo well blew out three weeks ago.  I will then suggest technical and regulatory improvements for your consideration.

Before I begin, I want to extend my sincere condolences to the families and friends of the eleven men who lost their lives on the Deepwater Horizon.  Offshore workers are vital to our economy and energy security; yet their important contributions to society often go unnoticed.  The best way to honor the victims of this tragedy is through our commitment to prevent future accidents.  Everyone I have spoken to, in the US and around the world, is eager to assist in any way possible.

I also want to express my disappointment in certain media comments directed at my former MMS colleagues.  These comments have not only been ill-informed and unsubstantiated, but malicious.  Without hesitation, I can tell you that MMS regulatory personnel – inspectors, engineers, scientists, and others – are 100% committed to their safety and pollution prevention mission.  MMS inspectors are themselves exposed to risks every day when they fly offshore and inspect facilities.  MMS personnel have repeatedly made personal sacrifices to support the regulatory mission.  After Ivan, Katrina, Rita, Gustav, and Ike, MMS employees worked to restore oil and gas production essential to our economy, even when their personal lives had been disrupted by the onshore impacts of these hurricanes.  These personnel work under strict ethics standards, and despite a few isolated and highly publicized incidents that occurred more than four years ago, conduct themselves with the highest degree of professionalism.  While a critical review of the entire offshore regulatory regime is necessary and appropriate, unsubstantiated accusations and personal attacks are not.

History, Compliance, and Blowout Record

Deepwater drilling is not new.  In 1965, the drillship CUSS I ushered in the deepwater era by drilling a well in 632′ of water offshore California.  In 1979, the Discoverer Seven Seas drilled an exploratory well in 4876′ of water off Newfoundland.  This was the first of many wells to be drilled in water depths similar to or greater than those at the Macondo site.  In the early 1980s, the Discoverer Seven Seas drilled a series of deepwater wells in the Mid-Atlantic including a record-setting well in 6952′ in 1984.  The current water depth record is 10139′ – more than twice the depth of the water at the blowout location.  In the Gulf of Mexico alone, 2500 wells were drilled in water depths greater than 1000′ between 1992 and 2006.  Recently, approximately 30 rigs have been operating in greater than 1000′ of water, about half of which are working in depths of 5000′ or more.

Deepwater rigs are typically staffed with experienced and capable personnel, and their compliance records tend to be very good.  I reviewed civil penalties summaries for the past 5 years (2006 to present) on the MMS website.  Not a single case appeared to be related to deepwater drilling operations.  According to recent news reports, the DWH had achieved a milestone of 7 years of accident-free operations

I have written several papers on blowout occurrence rates and causes.  The most recent paper, co-authored with David Izon and Melinda Mayes, reviews the blowout record during the 15-year period from 1992-2006.  I have attached a link to that paper and a summary of the pertinent findings.  According to these data, well control performance for deepwater drilling was significantly better than for shallow water operations. There were no fatalities or major spills associated with deepwater drilling blowouts during the 15-year study period.

Regulatory Issues Raised Since the Blowout

I will briefly comment on some regulatory issues that have been raised by the media since the Macondo blow out began on April 20.  The extent to which these issues are relevant to the blowout has yet to be determined.

Acoustic Backup Systems for Seafloor Blowout Preventers: At this time, there is no evidence that such systems would have made a difference in this incident.  Attempts to close BOPs were reportedly made prior to the DWH evacuation.  The BOP should have also been signaled when the rig lost power and when the riser disconnected.  It is unlikely that additional signals sent acoustically to the stack would have prevented the blowout.

MMS requires a backup system for all seafloor BOPs, and disconnect sequencing that ensures that a well is secured before the marine riser is detached from the well bore.   http://www.gomr.mms.gov/homepg/regulate/regs/ntls/2009NTLs/09-g11.pdf

The DWH backup was a remotely operated vehicle (ROV) which successfully stabbed into the BOP stack and attempted to actuate ram closure after the well blew out. Problems with the rams or other BOP components apparently prevented a full, effective closure.  The press has reported that cost was a factor in the MMS decision not to require acoustic backups.  I never heard cost mentioned in any discussions about these systems.  Concerns were raised that ambient noise from a flowing well would render the ROV systems ineffective, that seafloor topography might affect their reliability and performance, and that there was a risk of unintended actuations.  The internal consensus was that ROVs were the more reliable option.  Further research on this topic is suggested.

Shear Ram Reliability:  Shear rams are intended to cut through pipe that might be in the BOP stack when the well has to be secured in an emergency situation.  Heavier, high strength drill pipe is more difficult to shear, and thus a complete seal of the well bore is not always achieved.  Also, increased hydrostatic pressure at greater water depths and higher well pressure increase the force required to completely shear the pipe.  In 2003, MMS revised its regulations (250.416(e)) to require the submittal of information demonstrating that shear rams on the proposed BOP stack can cut the drill pipe in the hole under maximum anticipated surface pressure.  However, shear rams may not be able to cut tool joints and certain other equipment that is run through the BOP.  Since this is an industry-wide issue, I suggest that an international standard or guidance document be developed for minimizing the risk of shearing failures.  Standardized shearing tests should be required for each BOP model, and test data should be publicly available.

http://www.mms.gov/tarprojects/463/%28463%29%20West%20Engineering%20Final%20Report.pdf

Reduced BOP Testing Frequency: MMS reduced the required BOP pressure testing frequency to once every 14 days (from once every 7 days) after an internal review and a contract research study (http://www.mms.gov/tarprojects/253/AA.PDF)

indicated that there would be no increase in the risk of BOP failure.  To the best of my knowledge, no company or international regulator requires more frequent testing.

Cementing: Cement is used to secure the steel casing installed in the well bore, and prevent the migration of gas or fluids in the annulus surrounding the casing.  As indicated in the attached summary of blowout data, 18 of 39 blowouts during the 15-year period from 1992-2006 involved cementing operations.  An industry standard should be developed to address cementing problems, how they can be prevented, and the actions that should be taken when they do occur. In light of the findings from the Montara blowout (Australia) and related concerns elsewhere, there is significant international interest in such a standard.  The advisability of using external casing packers, in addition to cement, to seal certain annuli should also be considered.

Research – Deepwater and Well Control:  The MMS Technology Assessment and Research (TAR) program has been a leader in deepwater operations (http://www.mms.gov/tarprojectcategories/deepwate.htm) and drilling research (http://www.mms.gov/tarprojectcategories/drilling.htm), and funded a pioneering deepwater well control research center at Louisiana State University.  MMS also participates in the International Committee on Regulatory Authority Research and Development (ICRARD), a consortium that addresses offshore safety issues.  Many operators and contractors conduct related research.  An organized process for reviewing the findings and recommendations of industry and government safety research and proposing follow-up studies is suggested.

Research – Spill Response: The TAR program has conducted oil spill response research (http://www.mms.gov/taroilspills/) for more than 30 years and currently operates the Ohmsett spill response research center in New Jersey (http://ohmsett.com/).  Most boom and skimmer and skimmer performance data have been collected at Ohmsett.  Some of the first in situ burn tests were conducted at the facility.  Remote sensing tests and data on dispersant performance have also been collected at Ohmsett.  The TAR program funded one of the first studies on seafloor containment and collection systems.  The Coast Guard, NOAA, the states of Alaska and California, Norway, and Canada have been important oil spill research partners.  The oil spill research community is rather small, and the communication among researchers has been quite good.  Consistency is critical, and we need to make sure that industry and governmental research efforts are sustained.

Path Forward

In the aftermath of the DWH tragedy, we need to consolidate our efforts and ensure that all pertinent issues are addressed in a complete and timely manner.  I recommend that a single, independent commission be established to recommend operational and regulatory changes to the President and Congress.  The Commission should be comprised of technology, operations, and regulatory policy experts from the public and private sectors, and should draw on, not duplicate, the detailed technical investigation that the MMS and Coast Guard have just initiated.  The following are policy and technical recommendations that I believe such a Commission should consider:

1.    Streamline the OCS regulatory regime to minimize the potential for gaps, overlap, and confusion.  Because of the complexity of the OCS regime, regulatory and industry personnel spend too much time resolving and coordinating administrative and procedural matters.  This time would be better spent focusing on mission critical safety issues.   A single agency should be responsible and accountable for safety and pollution prevention at offshore facilities, and should draw on the expertise of other agencies and organizations as necessary to achieve performance objectives.

2.    Establish an independent authority to investigate offshore accidents, make recommendations, and assess trends.  Such an authority was first recommended by Dr. Don Kash, then a professor at the University of Oklahoma, in 1973 following a series of major offshore accidents.

3.    Either expand the role and jurisdiction of the Coast Guard’s National Offshore Safety Advisory Committee, or establish a new expert advisory board to review technological advances and performance data, and make recommendations regarding new research, standards, and procedures.  This board should also organize an annual public forum for presenting government and industry research and safety performance updates.

4.    Establish a public or private system for collecting and assessing failure data for blowout prevention equipment.  Establish standardized manufacturer testing programs for certain BOP components (e.g. shear rams).  The resulting data should be publicly released.   Existing quality assurance program for surface and subsurface safety valves (producing wells) should also be reviewed.

5.    Conduct a thorough review of BOP performance considerations including redundancy, independent functioning, shearing capability (for pipe or other obstructions), backup actuation options, and riser disconnect and drive-off sequencing (intentional and unintentional).

6.    Expand existing well control training programs or develop new programs to cover well integrity issues. This training should include a review of major historical accidents to remind personnel what can happen and why.

7.    Develop standards that address best practices for cementing operations with decision/fault trees that describe safeguards, problems, and appropriate responses. Consideration should be given to other options, such as external packers, for redundant annular protection above oil and gas reservoirs.

8.    Establish special procedures that will facilitate the prompt publication of safety rules.  The Federal review and publication process for rules is enormously complex, time consuming, and frustrating.  Too many resources must be dedicated to getting rules through the system, and technological advances and new findings cannot be readily addressed.

9.    Require that all OCS operators have comprehensive safety and environmental  management programs.  Compliance with prescriptive rules and standards is only part of the safety equation. Companies must actively manage their activities to minimize safety and environmental risks.  These management programs should also explain how the company will participate in the standards development and research activities needed to make everyone safer.

10.                     Recognize the importance of international cooperation on offshore safety and pollution prevention issues.  The offshore industry is international in scope, as are the operational and regulatory challenges.  Effective international communication reduces risks and burdens.  The International Regulators’ Forum  (http://www.irfoffshoresafety.com/ ) is a model for informal cooperation, but more could be done.

Thank you for the opportunity to participate in this hearing.  I’ll be happy to respond to any questions.

Attachment

OCS Drilling Blowouts – 1992 to 2006

Elmer Danenberger, David Izon, and Melinda Mayes

(http://drillingcontractor.org/dcpi/dc-julyaug07/DC_July07_MMSBlowouts.pdf)

Highlights:

1.    During the study period, blowouts occurred at a rate of one for every 387 wells drilled, compared with a rate of one blowout for every 246 wells during the period covered in my previous blowout study (1971-91).

2.    2493 wells were drilled over the study period in water depths greater than 1000.’ There were five minor blowouts yielding a rate of 499 wells per incident.  This is better than the rate of 387 wells per incident for all water depths.

3.    The severity of blowouts, as measured by their duration and consequences, decreased significantly compared with the previous study period (1971-1991). Only one fatality and two injuries resulted from drilling blowouts during the 1992-2006 period compared with 25 fatalities and 61 injuries during the previous period.  The fatality was on a jackup rig; a crew member was found missing after the rig was evacuated because of well control incident.

4.    The seven fires and explosions associated with the 1992-2006 blowouts occurred either on jackups or platform rigs, not deepwater floating rigs.

5.    Blowouts during the 1992-2006 period resulted in the spillage of 341 bbls of oil/condensate and 982 bbls of synthetic-based mud.  Most of the spillage resulted from an unintended riser disconnect, that caused a release of mud and allowed the well to flow briefly.  The blowout preventers were shut-in by a remotely operated vehicle.  Procedures were changed to automatically close blowout preventers when the riser is disconnected.

6.    Over-pressured shallow gas influxes persisted as a major contributing factor to blowouts. These incidents have minimal environmental risk, but significant safety risk.

7.    While the number of blowouts declined, the percentage of blowouts associated with cementing operations increased significantly.  Cementing problems were a contributing factor in 18 of the 39 incidents.

8.    Half of the blowouts lasted less than 24 hours.  The longest lasted 11 days.  Over 50% of the blowouts were controlled by pumping mud or cement or by actuating mechanical well control equipment.  36% of the wells ceased flowing because sediments bridged or sealed the well. 13 of the wells ceased flowing when trapped gas or shallow gas pockets were depleted. Although relief wells were initiated in two of the blowouts, both wells were controlled by other means prior to completion of the relief well.

9.    Of the 34 blowouts involving mobile drilling units, 28 were bottom-founded jackups.  Only 6 involved floating rigs, all semisubmersibles.

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