War of words erupts on deep-sea oil safety

The risk of one "notifiable incident" occurring annually on a deep-sea oil rig rises to 70 percent in the deep waters being explored by Texan oil firm Anadarko in the Taranaki and Canterbury basins over the summer.

The Ministry for the Environment included this advice in a memorandum to Ministers in October last year, which Labour Party leader David Cunliffe produced for media today at New Brighton, Christchurch, after the Environment Minister Amy Adams had initially withheld it.

Ironically, the graphic withheld is one element of the so-called secret document that is available on the Internet in a report produced after the 2010 Deepwater Horizon well catastrophe in the Gulf of Mexico, in which Anadarko was an investor.

The 70 percent figure compares with a 10 percent risk of a notifiable incident occurring once a year on any of the six shallow-water wells currently producing oil and gas off the Taranaki Coast, within sight of land, unlike Anadarko's Romney prospect in the Taranaki Deepwater licence area (PEP38451).

Such wells have been operating without serious incident and, in the case of the Maui platform, since 1979.

Some four exploration rigs will also be operating in New Zealand waters over the coming summer, with the first campaign already under way. An exploration well in the Manaia prospect, operated by OMV of Austria, hopes to give extra life to the nearby Tui field's production platform.

Cunliffe said Adams had tried to cover it up and only released additional elements of the advice after further requests.

That prompted the oil industry lobby group, the Petroleum Exploration and Production Association of New Zealand, to accuse Labour of misrepresenting data. The politically heated issue is boiling now as Anadarko's drill ship, the Noble Bob Douglas, prepares to start drilling 100 nautical miles off the northern Taranaki coast, attended by a small protest flotilla.

"The 70 percent does not refer simply to the probability of a large oil spill," said PEPANZ chief executive David Robinson. "In fact it is saying the more people and machinery you use, the more chance there is of a cut finger, injury, fire or any other incident that you would see on a construction site anywhere."

Cunliffe was able to claim the government had tried to suppress elements of the report because Adams issued two edited versions of the Oct. 12 2012 MfE report both last month and this month.

The November report contained more detail, including a graphic from an American report on the Deepwater Horizon disaster that acknowledges the higher risk of incident on deep-sea rigs.

"Although the analysis does not suggest that the water depth itself is the cause of increased incidents, it does reinforce the suspicion that drilling at increased depths results in greater technical challenges and, therefore, may require novel approaches to industry operation and regulation," says the 'Recommendations for a Safer Future' report.

Cunliffe's move positions Labour between the National and Green parties, supporting oil and gas extraction but adopting a more cautious approach towards deep-sea oil exploration.

Meanwhile, the stand-off between the oil exploration ship Noble Bob Douglas, leased by Texan oil company Anadarko, continues with a Greenpeace-backed protest flotilla of six yachts.

One vessel, the Vega, is remaining at the 500 metre exclusion zone controversially established earlier this year for oil industry infrastructure operating in New Zealand's vast Exclusive Economic Zone, which extends 200 kilometres from the coast.

The latest release follows questions yesterday from the Environmental Defence Society about the regulatory processes involved in vetting the drilling plans for Anadarko's two planned wells, the other to be drilled in the Canterbury Basin's Caravel prospect early next year.

The Environmental Protection Authority was forced to defend the fact that the oil spill response plan is the preserve of the Maritime Safety Authority, not the EPA, with the Ministry for Business, Innovation and Employment responsible for well integrity and workplace safety.

"The EPA is an environmental regulator," its chief executive, Rob Forlong, told BusinessDesk. The newly minted EEZ Act was about regulatory "gap-filling". There had been no environmental regulation for the EEZ in the past.

Maritime Safety had the expertise for spill response, as demonstrated in the response to the grounding of the cargo ship Rena off Tauranga in 2011.

MfE officials note in their advice last year that "no regime assesses the acceptability of the activity taking place in a particular location of the EEZ and continental shelf, given the localised environments and existing interests."

The EPA today called for public submissions on an application to mine ironsands in the EEZ in the southern Taranaki Bight from Trans-Tasman Resources seeking to export seabed mined ironsands to meet demand from predominantly Asian steelworks.

A similar trade has existed at Taharoa, south of Manukau Heads, vacuuming iron ore-rich beach sand to offshore since the 1950s.

(BusinessDesk)