A Thought on a Thursday
A friend of mine was cribbing the other day about how her mischievous cat had jumped on to her cooking table and knocked over a pan of cooking oil that she'd kept there. The oil spilled all over the table and the sink, leaving a clean, polished surface all slick and sticky. I kept quiet, since I really couldn't say anything. You can't ground the cat, she just won't understand. You can' tell the cat that the kitchen is off limits; dogs understand, cats don't care! Neither can you banish cooking oil from your life!
The present BP oil spill off the Gulf coast is a classic story. And somehow I get hit by a sense of deja vu. Oil spills happen all the time, it appears. Not even half way into 2010, and there have been 2 already - the big BP oil spill or Deepwater Oil spill as it is called, caused by an explosion and subsequent sinking of a drilling platform off the Gulf of Mexico and another caused by the collision of a light crude tanker and a bulk carrier in the Singapore Strait. There were 3 spills in 2009, 2 of which were in Australia, losing a maximum of 30230 tons of crude. In 2008, again there was a spill in New Orleans, and just one spill for the year. Maybe the recession put a plug on drilling work too, for there seems no reason why carelessness dropped that one year, only to balloon up again. Over history, US has had the notoriety of 27 oil spills. Can't blame them, since they perhaps drill the most too! The worst ever oil spill though was the Gulf War oil spill in 1991, but then all is fair in love and war and so that can perhaps be disregarded.
So, what's the big deal this time? Why such hue and cry over some oil spilling on some water? My friend's cat isn't getting so much of attention anyway; in fact she is getting the silent treatment from my friend. Anyway, this spill has brought to light technological nightmares that can occur in case of a Black Swan effect in a field other than finance. All the methods of mitigation known and used so far are best suited for surface spills not deep water oil well bursts! The crude here is a sticky kind, that emulsifies easily, meaning it forms an oil-water mixture after which dispersants that disintegrate the oil cannot be used. Every method they have tried so far, after the ping pong blame game that is, has floundered, well, literally. Be it placement of an underwater oil recovery system - which failed because it formed methane hydrate crystals that clogged the system; or even using a smaller containment dome. At last, a permanent closure of the well is the only solution in sight. And how? Using the traditional method of stuffing heavier drilling fluids which push the oil down. Again, it will take 3 days before we know with certainty that the solution has worked.
In the meantime, the arguments have been plenty. And everyone has had more than their 15 minutes of notoriety. From BP vs Transocean, over who goofed up, the lessor or the lessee, to an argument over whether the government was acting fast enough or were they goofing off, lost in a mire of bureaucracy. And then came the numerous questions over why the safety systems especially the 'dead man's switch' which was supposed to have sealed the well, had communication between the drilling platform and the well failed died just when they had to work. Just as in the case of the Bhopal Gas Tragedy in India, where Methyl Isocyanate escaped off a failed safety valve, in just the way it shouldn't have. Why was a special nitrogen foamed cement, which was characteristically more difficult to handle used here? Why was the final capping not done? Who is to blame? Why was an independent assessment of the spill not allowed? What was being covered up?And what can be done to prevent this in the future, or is every spill unique? How can the fish and birds be protected? And what about all that oil lost?
Just like the 2008 crisis was a lesson in finance, over how things could go wrong and how best to brave such situations, I guess this spill is a lesson on how to expect the unexpected. Only that finance perhaps heals faster, but nature is cracked forever, literally. And this is one helluvan expensive lesson indeed.