The Gulf Oil Spill Disaster
by ilene - August 14th, 2010 4:54 pm
The Gulf Oil Spill Disaster
Courtesy of John Mauldin at Thoughts from the Frontline
As I mentioned last Monday night in my Outside the Box, I did not make it to Turks and Caicos, but did end up in Baton Rouge for a special seminar on the Deepwater Horizon Gulf oil spill. I have both good news (or maybe more like less-bad news) and bad news. Today’s letter is a report on what I learned.
The conference was sponsored by the Global Interdependence Center (GIC - http://www.interdependence.org/). David Kotok of Cumberland Advisors organized the event with help from people from Louisiana State University. The quality of the speakers was outstanding. They were extremely knowledgeable and well-connected. The meeting was conducted under the Chatham House Rule, which means all the speakers spoke off the record, unless they indicated otherwise. This allows for a more frank discussion. So, much of what you will read from me is my impressions of what I heard, which I cannot attribute to specific speakers. Indeed, some would be at some occupational risk if I did so.
Some of what I write today will be controversial to some readers. That is a risk I will take, as the large majority will find this interesting, or at least I hope so.
From Unmitigated Disaster to Merely Disaster
First, let’s begin with the "good" news. The ecological destruction that was first feared is not going to be as bad as once thought, for a variety of reasons. It is not good, but it is not the unmitigated disaster it could have been.
Edward Overton, PhD, Professor Emeritus, Dept. of Environmental Sciences, LSU, is an expert on oil spills. He was at the Exxon Valdez. The Exxon Valdez (EV) was a big, black, thick tide of oil. The Deepwater Horizon is a much bigger spill: every ten days the amount of the EV spill spewed into the Gulf, from April 20 to July 15. Professor Overton spoke mostly for the record. He is very much a concerned environmentalist, and he is also a very serious scientist.
He reminded us that the Louisiana wetlands are a very important part of the ecological system of the Gulf of Mexico. Oversimplifying, they are the nutrient source for the small animal world which feeds the larger. Without the…
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TLP: Of Course, the Mariner Would Know What to Do
by ilene - June 12th, 2010 5:32 pm
TLP: Of Course, the Mariner Would Know What to Do
Courtesy of Jr. Deputy Accountant
Scarier than the Coast Guard?
But, uh, BP, Waterworld was a movie. Oh well, maybe Costner’s oil-sucking machine will do better than what BP has tried so far.
WWL has the story:
BP has given the green light for funding of a device that can separate oil from water.
Development of the machine, which uses a centrifuge to separate the fluids, has been backed by actor Kevin Costner to the tune of $25 million.
John Houghtaling, Costner’s chief partner in the project, told WWL First News that the oil company has ordered 32 of the devices for use in the Gulf of Mexico.
"In a matter of weeks, we can be manufacturing ten of these a week," Houghtaling said. "So we’re hoping by the first of August to have all 32 of these things in the Gulf."
At $500,000 each, that order from BP has Costner well on the way to recouping his investment. And BP has the opportunity to appear visionary if it works and f*^king ridiculous if it doesn’t.
Here’s a movie, not starring Kevin Costner:
Popcorn, anyone?
Source: Kevin Costner’s anti-oil machines to be deployed
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Oil Slickonomics
by ilene - May 14th, 2010 1:52 pm
Oil Slickonomics
(Parts 1 – 3, including update)
Courtesy of David R. Kotok, Chairman & Chief Investment Officer, Cumberland Advisors
Oil Slickonomics – Part 1 (May 2, 2010)
“At its current leak rate of 5,000 barrels of oil per day, the spill could surpass the size of the 1969 Santa Barbara spill by next week. If the leak cannot be contained, it could exceed the size of the 1989 Exxon Valdez oil spill off Alaska by mid June.” Paul Harrison, Environmental Defense Fund
Three scenarios lie ahead. They rank as bad, worse, and ugliest (the latter being catastrophic and unprecedented). There is no “good” here.
The Bad.
Containment chambers are put in place and they catch the outflow from the three ruptures that are currently pouring 200,000 gallons of oil into the Gulf every day. If this works, it will take until June to complete. The chambers are 30-foot-high steel configurations that must be placed on the ocean floor at a depth of one mile. This has never been done before. If early containment is successful, the damages from this accident will be in the tens of billions. The cleanup will take years. The economic impact will be in the five states that have frontal coastline on the Gulf of Mexico: Texas, Louisiana, Mississippi, Alabama, and Florida.
The Worse.
The containment attempts fail and oil spews for months, until a new well can successfully be drilled to a depth of 13000 feet below the 5000-foot-deep ocean floor, and then concrete and mud are injected into the existing ruptured well until it is successfully closed and sealed. Work on this approach is already commencing. Timeframe for success is at least three months. Note the new well will have to come within about 20 feet of the existing point where the original well enters the reservoir at a distance of 3.5 miles from the surface drilling rig. Damages by this time may be measured in the hundreds of billions. Cleanup will take many, many years. Tourism, fishing, all related industries may be fundamentally changed for as much as a generation. Spread to Mexico and other Gulf geography is possible.
The Ugliest.
This spew stoppage takes longer to reach a full closure; the subsequent cleanup may take a decade. The Gulf becomes a damaged sea for a generation. The oil slick leaks beyond the western Florida coast, enters…
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Oil Rig Expert Talks About Oil Spill In Gulf; Rain, Choppy Seas Halt Cleanup; Spill Images
by ilene - April 24th, 2010 1:07 pm
Oil Rig Expert Talks About Oil Spill In Gulf; Rain, Choppy Seas Halt Cleanup; Spill Images
CNN talks with oil rig expert Bud Danenberger on the rig failure in the gulf and the potential for the oil spill. Click on link to see video. Another video follows.
Oil slick spreads from sunken rig
Rain, Choppy Seas Halt Cleanup
Please consider Rain, choppy seas halt cleanup near sunken oil rig
Choppy seas, strong winds and rain halted Saturday’s cleanup of an oil spill around the massive oil drilling rig that exploded and toppled into the ocean off the Louisiana coast.
Eleven workers are still missing from the Deepwater Horizon rig that sank Thursday about 50 miles from Louisiana’s coast. They are presumed dead.
The bad weather rolled in Friday, bringing with it strong wind, clouds and rain that interrupted efforts to contain the oil spill. Petty Officer Erik Swanson of the Coast Guard said cleanup would resume once the weather cleared.
The cause of Tuesday’s massive blast off the Louisiana coast is unknown. On Friday, Coast Guard officials suspended the three-day search for the missing workers.
An undetermined amount of oil has spilled from the rig, though Swanson said Saturday morning that remotely operated vehicles had not yet detected any leaking oil from the well or rig. However, crews are closely monitoring the rig and well for any more crude that might spill out.
An oil sheen appeared to cover an area about two miles wide and eight miles long Friday afternoon.
BP, which is taking the lead in the cleanup, said it has activated an extensive oil spill response, including the remotely operated vehicles to assess the well and 32 vessels to mop up the spill. The Marine Spill Response Corp., an energy industry cleanup consortium, also brought equipment. …
BP PLC, which leased the Deepwater Horizon, opposes what it says are "extensive prescriptive regulations."
Rough Seas, Thunderstorms Threaten Oil Spill Area
From the Weather Channel: Rough Seas, Thunderstorms Threaten Oil Spill Area
While crews race to contain the Gulf of Mexico oil spill, severe weather and a period of rough seas this weekend will threaten the area as a line of thunderstorms is forecast to move through the region.
Thunderstorms will sweep west to east through the area, bringing thunder, lightning and up to several inches
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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
Ilene is editor and affiliate program
coordinator for PSW. She manages the site