Crew members of the Danny Adkins, a drilling rig owned by Noble Corp. (NE), watched new paint dry as they waited for the resolution of the Gulf's biggest drama: whether the temporary ban on offshore drilling imposed by the Obama administration will stick.
Crew members of the Danny Adkins, a drilling rig owned by Noble Corp. (NE),
watched new paint dry as they waited for the resolution of the Gulf's biggest
drama: whether the temporary ban on offshore drilling imposed by the Obama
administration will stick.
The seven-story-tall rig was moved to this spot, 220 miles south of Houston, to
drill a deepwater well for Royal Dutch Shell PLC (RDSA) in late May, a few days
before the Interior Department decreed a six-month moratorium on Gulf of Mexico
drilling in the wake of the Deepwater Horizon oil spill.
Even though a federal court struck down the moratorium, Shell, like other Gulf
producers, isn't letting the rig return to work while an appeal is pending. For
Shell and Noble executives, it's unclear how easy it will be to obtain a
federal permit to drill, even if the ban is permanently overturned. In the
meantime, the Anglo-Dutch oil major is still paying the rig owner an
undisclosed amount. Typically, a rig like the Danny Adkins would fetch between
$400,000 to $600,000 a day but Shell agreed to pay Noble a "reduced
suspension rate" while extending the length of the contract.
Meanwhile, the Noble crew has been engaging in busy work, such as repainting
the brand-new half-billion-dollar vessel. But there's only so much maintenance
work they can do. The workers' frustration underscores a similar malaise among
energy company executives and
Gulf
Coast
officials at what they perceive is an arbitrary disruption of the region's main
economic engine.
"We need to go to work," rig manager Jessie Jordan told U.S. Sen.
John Cornyn, (R-Texas), Rep. Pete Olson (R, Texas) and a few reporters visiting
the rig Tuesday. The company and politicians took part in the trip in an effort
to promote the safety of deepwater drilling and its positive impact on the
economy of coastal states.
"For 20 years, you guys have been doing things right," Olson told the
rig workers.
As the legal battle over the moratorium reaches a critical point--the U.S.
Fifth Circuit Court of Appeals will hear the case on Thursday--the offshore
drilling industry and its political backers are ratcheting up their criticism. At
stake, they say, are 150,000 jobs and the economic lifeline of a region that
has weathered the recession better than the rest of the country.
Contractors fear the tighter regulation will squeeze them out of the Gulf, and
some of the rigs that end up in
Brazil
,
West
Africa
or other offshore areas, may never come back.
"Just about every rig sitting in the Gulf right now is trying to find a
way to get out of the Gulf," said Louis Raspino, chief executive of
drilling contractor Pride International Inc. (PDE). "In a very, very short
period of time we're going to see this industry implode," he said
Wednesday at a gathering of the International Association of Drilling
Contractors in
Houston
.
Backers of the moratorium say it will help authorities make sure drilling is
safe before it can continue, reducing the possibility of another massive oil
spill such as the one unleashed by the explosion and sinking in April of the
Deepwater Horizon drilling rig. The blast killed 11 people, and the spill,
which continues to spew crude into the Gulf, has become one of the worst
offshore leaks in
U.S.
history.
The incident has incensed opponents of expanded offshore drilling in areas such
as
Florida
and
California
, and
has prompted Rep. Ed Markey (D-Mass) to say that investment in deepwater
drilling has far surpassed the industry's ability to deal with unintended
consequences.
At the IADC meeting, drillers took a belligerent stance against the moratorium.
The group's director, Lee Hunt, compared the measure to Venezuelan President
Hugo Chavez's recent move to nationalize privately owned drilling rigs. In
Venezuela
, the
rigs were "nationalized by fiat. We have 33 rigs that have been
neutralized by fiat," he said.
A presentation slide called U.S. Judge Martin Feldman, who overturned the
moratorium, a "hero." Olsen, a speaker at the meeting, was also
hailed as a hero. He called the moratorium was "the wrong decision."
At the drilling rig, which was hired to drill at a depth of 9,000 feet below
sea level, Noble crew members said they have the right safety procedures in
place and the rig has been thoroughly inspected by the Bureau of Ocean Energy
Management, Regulation and Enforcement, the agency formerly known as the
Minerals Management Service. President Barack Obama ordered the reorganization
of the agency after the Deepwater Horizon disaster amid accusations of lax
oversight.
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