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CURRENT ISSUE

DEEPWATER HORIZON SPILL
How long will the political fall out from the spill delay plans to expand U.S. offshore drilling

Hardly at all
For 1-2 years
For longer than 2 years

May 12, 2010

IADC seeks exemption from drilling ban for shallow water ops

In the wake of the Deepwater Horizon incident, all new drilling in the U.S. Gulf of Mexico is under an interdiction scheduled to last at least three weeks.The International Association of Drilling Contractors (IADC) is seeking a reprieve for drilling operations in the shallow-water Gulf of Mexico.

IADC believes that prohibiting new drilling in water depths less than 1,000 feet could cause the loss of thousands of jobs and spur business insolvencies. IADC is seeking an exemption from the drilling ban for this type of operation, as well as a clarification of the rule.

"The current spill in the Gulf of Mexico was caused by an operation in 5,000 feet of water using blowout preventers on the seabed," remarked Dr. Lee Hunt, president of IADC. "In contrast, drilling in less than 1,000 feet of water using blowout preventers above the sea surface is very different.

Typically, drlling wells by jack-up rigs in shallow water takes 15-40 days. Should the current ban continue through 1 July, IADC estimates that some 60% of Gulf of Mexico rigs could be idled.

Dr. Hunt notes that while deepwater operations primarily explore and develop oil resources, in shallow water the resource is primarily natural gas. Oil remaining in shallow-water reservoirs has largely been produced and is underpressured, limiting its likelihood of spewing out of control. In addition, in shallow water, the sea bed can be much more easily accessed for intervention by remote craft and even divers. Further, temperatures in shallow water are much warmer than in deep water, forestalling the formation of crystallized gas hydrates.


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