Deepwater Drilling

Alexander Liegl
December 11, 2014

Submitted as coursework for PH240, Stanford University, Fall 2014

Introduction

Fig. 1: Deepwater Drilling Systems (Source: Wikimedia Commons).

Deepwater drilling is a method of exploring for oil and gas sources, with approximately 3400 deepwater wells currently in use in the Gulf of Mexico with depths of 150 meters or more. [1] In general, deepwater drilling is very expensive and not economical for smaller corporations. These corporations, amongst others, are expected to increase their deepwater capital expenditure by 130% with a total of $260 billion from 2014 to 2018. [2] Of that, $213 billion is set to be spent in Africa and the Americas alone. While there has been a lot of controversy regarding incidents such as the BP oil spill of 2010, analysts maintain that the resumption of drilling is mainly driven by the high demand for energy worldwide. [3]

Types of Deepwater Drilling Rigs

There are generally two kinds of mobile deepwater drilling rigs: semi-submersible drilling rigs or drill ships used for the conduction of deepwater drilling. Else, there are multiple fixed- position installations that are currently in use:

Arctic Oil Drilling

The drilling in the Arctic is one of the most challenging endeavors present in todays quest for oil. However, significant improvements in technology and a melting of ice in some regions allows for more serious exploration and production of oil. Especially tantalizing to oil companies like Shell is the prospect of producing more than 400,000 barrels of oil a day in the Chukchi Sea alone. However, there have been a series of issues so far, culminating in the grounding of a vessel in late December 2012 due to stormy weather. This has left other companies like ConocoPhillips and Statoil suspend their Alaskan Arctic drilling plans for now. [5]

Criticism of Arctic Oil Drilling

Environmentalists argue that drilling in the Arctic is overly risky because of ice floes, darkness in the winter, and the presence of already endangered species. Environmental groups have formed a coalition, among them Biological Diversity and Earthjustice, to challenge any new assessments by the Interior Department's Bureau of Ocean Energy Management. This Bureau is planning on issuing another assessment to prepare for drilling companies' efforts in the Alaska region. The environmentalist coalitions are expected to oppose any amendments to the Bureau's assessment. They claim that the companies desiring to drill in the Arctic are prepared enough to do so, in their opinion, given their recent efforts. [5]

© Alexander Liegl. The author grants permission to copy, distribute and display this work in unaltered form, with attribution to the author, for noncommercial purposes only. All other rights, including commercial rights, are reserved to the author.

References

[1] W. L. Leffler, R. Pattarozzi, and G. Sterling, Deepwater Petroleum Exploration and Production: A Nontechnical Guide, 2nd Ed. (PennWell Corp., 2011).

[2] B. Rangi, "Deepwater Spend Forecast To Surge From 2016," Oil and Gas Financial Journal, 11 Apr 14.

[3] C. Krauss and J. M. Broder, "Deepwater Oil Drilling Picks Up Again as BP Disaster Fades," New York Times, 4 Mar 12.

[4] K. Sadeghi, "An Overview of Design, Analysis, Construction and Installation of Offshore Petroleum Platforms Suitable for Cyprus Oil/Gas Fields," GAU J. Soc. Appl. Sci. 2, 1, (2007).

[5] C. Krauss, "Shell Submits a Plan for New Exploration of Alaskan Arctic Oil," New York Times, 28 Aug 14.