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June 2010

News Letter - 14th June 2010

The major event over the past six weeks affecting the offshore and, therefore to a certain extent, the marine industry has been the blowout and sinking of the rig Deepwell Horizon operated by B.P. It has caused massive pollution in the waters of the U.S. Gulf by spewing out oil of the order of 20,000 or more barrels of crude (3,000 cubic metres) per day! The well is 5,000 feet below the surface of the water (5280 feet equals one mile) and the drilling will be 20,000 feet or more into the earths crust. The technology to ‘win’ oil at this depth was developed initially in the North Sea and continues to be developed and BP is the pioneer of this technology as they were with the development of directional drilling. They and other oil companies are working at the limits of present day technology and when doing such there are going to be accidents. It is easier today to put a man on the moon than it is to produce oil from such depths!!

BP has been attacked fiercely by the President of the U.S. with utterances that he wants the CEO of BP (Tony Hayward) sacked and he wants his head on a plate – these are not phrases one would expect from a person in high office and such utterances do nothing to mitigate the damage or assist in cleaning up or stopping the leak. What BP needs at present is all the help and support they can get so they can focus all efforts on stopping the leak and cleaning up. Once the leak is stopped and the clean up is well in hand then, and only then, should the investigation into what happened begin followed by corrective action and compensation. No one who has never been in a crisis situation of a technical nature can begin to understand the stress that Mr. Haywood will be under – this stress is continuous and unrelenting, even when he is sleeping (if he can sleep) this crisis will be with him. The burden is unbelievable – and that is without the likes of the U.S. President making unsubstantiated accusations against him and the Company.

In 1988 the Piper Alpha rig blew up in the North Sea causing massive pollution and killing 167 workers – there were only 59 survivors out of the total number of workers. The operator of that rig was Occidental Petroleum: an American oil company! Occidental were not subjected to the loud and objectionable rhetoric by the British Government that BP are being subjected to by the American President – this seems to have been conveniently forgotten. The President should know (or be told) that 40% of BP stock is held by the American public so by ‘talking down’ BP he is also hurting America!

The U.S. Gulf is not the only area of the world where such drilling is being carried out; there are similar and deeper fields off the Brazil and African coasts along with Australia’s N.W. coast. We are not trying to make out this disaster is of lesser consequence than it is – it is an environmental disaster on a massive scale and the clean up will go on for a considerable period but the U.S. President would be better explaining why we are drilling for oil at this and greater depths – to try to satisfy the publics’ insatiable demand for more and more energy – led by the American public who are still by far the largest consumers (gas guzzlers) per head of oil and gas in the world. Of course for the U.S. President to say such a thing would be political suicide!