AUG 12, 2010 - UPDATE - Another oil industry expert has taken up the baton from fallen Matt Simmons. Bob Cavnar has viewed the recent capping and static kill effort in the Gulf with a healthy dose of guarded suspicion. Cavnar believes the pressure from the well, which should have gone to zero, indicates that there is still subsurface leakage, and that the static kill procedure may have made these leaks worse, creating open communication between the reservoir and the sea. And in fact, these leaks are fairly obvious. There have been numerous video sequences of obvious oil and gas eruption from the sea floor, but now that the constant light of the media has dimmed, these get little attention. But Cavnar asks some nagging questions: “Why is the wellhead leaking? To be clear, dead means dead. If it’s leaking oil, that means it’s not dead... I’m sitting here watching oil leaking from a well that is supposedly dead. I’m listening to Admiral Allen saying the well is dead and to Jane Lubchenco and Carol Browner seriously contending that almost 4 million barrels of oil have disappeared. Is it just me, or are we watching the Matrix in real life?” Cavnar also commented on the pressure, reported at 4300psi: “The fact that they’re getting pressure now tells me that they are indeed communicated to the reservoir below, probably obscured by the fact that they now have mud strung through the annulus. If they are indeed communicated, pressure will build on the wellhead, which is exactly what’s happening.”
Thursday, August 12, 2010
Monday, August 2, 2010
Macondo USA
Our economy is mirrored by the slow motion disaster we have watched the last 100 odd days in the Gulf. The financial world and big rig banks were drilling deep into the dark, little understood world of derivatives sludge, pumping out credit to an artificially heated economy like light sweet crude. Then something went wrong. The line kicked in a massive burp of sub-prime gas, and one of our rigs went up like a firecracker, sinking into insolvency faster than you can say “Deepwater Horizon.” The financial blowout preventers failed, and the markets sank as fast as the rig. Lehman died and the whole system damn near froze in a self-imposed drilling moratorium of fear. CEO's bumbled about with one news gaffe after another, and were replaced. Then the “credit event” began to gush non-performing loans—40% sub prime methane and the rest spewing out the toxic ALT-A and option ARM petrol until our financial world was soon awash in a glistening sheen of failing portfolios.
Predictably, the tarballs of bad debt began to soil beaches from one end of our financial gulf to another. Some said they would migrate into the loop currents of international trade and kill the whole ocean. But like the liberal use of Corexit dispersant applied to hide the problem and keep the oil from rising to the surface where everyone would see it and be forced to deal with it, we applied liberal doses of FASB accounting rules changes, and Fed Programs as fat as “A Whale” to skim off any bad loans that did surface to the top of bank balance sheets. Most of the real damage was just shunted away in the limbo accountants call “Level 3,” an off balance sheet water column where most of the widely dispersed bad debt now still hangs in vast plumes. Then we pumped in billions of freshly printed TARP dollars like heavy mud in an effort to staunch the flow of debt. The ROVs of the formerly brain dead SEC have been hovering over the wreckage of the great firms that fell in the explosion, Bear Stearns, Lehman Brothers, Fannie Mae and Freddie Mac, AIG, Chrysler, GM and all the rest. The public watched it all like a bad summer disaster movie, noting the seeps of oil and gas from one location after another.
The Fed skillfully positioned an array of financial vessels above the gushing hemorrhage of toxic debt, drilling deep into its portfolio to try and stem the flow. They siphoned off as much as they could through the risers of acronym laden programs aimed at sucking up the bad paper, but there was just too much toxic sludge in the financial waters, and the whole ecosystem began to choke on the methane soup of swaps, trades and securities. But eventually they engineered a multi-trillion dollar “cap” and lowered it over the wellhead of insolvency, pretending the problem was solved while they figure out how to kill the damn thing once and for all before something else blows out. They tinkered with the pressure in little "stress tests" and finally decided it was safe to call the show a "recovery." All the while the media ROVs have been beaming images of potential new leaks from the mangled BOP, and the tortured sea floor of the financial world has been seeping from one fault after another. Now they're wondering just how much more bailout mud they'll have to pump in to bolster the markets through the dog days of summer, and then finally seal off this blown out depression of an economy once and for all.
In the meantime, the oil and gas of credit that once greased our world has dried up and all but vanished. And like the carefully underestimated numbers put out by BP as to how much oil was really leaking and how much dispersant they really used to hide it all, no one actually knows just how much more bad debt is out there in the oil dark Gulf of insolvency, and how long it will take us now to clean it all up. All the while bloggers have been barking like Matt Simmons that the whole show was a sham and that there was another leak, (commercial real estate?) just a few miles off that was even bigger and threatened to create a lake of bad debt so big that it could poison the entire financial sea. Nobody listened ... They said he was off his rocker. The BOP was still there. The cap was holding. The recovery wells at the Fed were drilling and, in just a few weeks time, we could forget this moratorium of financial reform and get back to the deep water derivatives drilling again.
Meanwhile, unemployment skyrocketed and people lined up at the government trough like all the ex-shrimpers and oyster men of the Louisiana coast. The price of seafood went up and up, and the folks who lost their jobs and gave up looking have just been quietly removed from the "labor force" so we can continue to pretend unemployment is only 9.5%.
We fixed nothing; learned nothing. We just capped off the well and dispersed all that toxic debt to hide the problem. In the meantime, the banksters are gearing up for the next election in their too big to fail platforms, and when the cameras on the ROVs are finally turned off they can rub their palms in bonus money and get back to the long lost mantra of “Drill, Baby, Drill.”
Predictably, the tarballs of bad debt began to soil beaches from one end of our financial gulf to another. Some said they would migrate into the loop currents of international trade and kill the whole ocean. But like the liberal use of Corexit dispersant applied to hide the problem and keep the oil from rising to the surface where everyone would see it and be forced to deal with it, we applied liberal doses of FASB accounting rules changes, and Fed Programs as fat as “A Whale” to skim off any bad loans that did surface to the top of bank balance sheets. Most of the real damage was just shunted away in the limbo accountants call “Level 3,” an off balance sheet water column where most of the widely dispersed bad debt now still hangs in vast plumes. Then we pumped in billions of freshly printed TARP dollars like heavy mud in an effort to staunch the flow of debt. The ROVs of the formerly brain dead SEC have been hovering over the wreckage of the great firms that fell in the explosion, Bear Stearns, Lehman Brothers, Fannie Mae and Freddie Mac, AIG, Chrysler, GM and all the rest. The public watched it all like a bad summer disaster movie, noting the seeps of oil and gas from one location after another.
The Fed skillfully positioned an array of financial vessels above the gushing hemorrhage of toxic debt, drilling deep into its portfolio to try and stem the flow. They siphoned off as much as they could through the risers of acronym laden programs aimed at sucking up the bad paper, but there was just too much toxic sludge in the financial waters, and the whole ecosystem began to choke on the methane soup of swaps, trades and securities. But eventually they engineered a multi-trillion dollar “cap” and lowered it over the wellhead of insolvency, pretending the problem was solved while they figure out how to kill the damn thing once and for all before something else blows out. They tinkered with the pressure in little "stress tests" and finally decided it was safe to call the show a "recovery." All the while the media ROVs have been beaming images of potential new leaks from the mangled BOP, and the tortured sea floor of the financial world has been seeping from one fault after another. Now they're wondering just how much more bailout mud they'll have to pump in to bolster the markets through the dog days of summer, and then finally seal off this blown out depression of an economy once and for all.
In the meantime, the oil and gas of credit that once greased our world has dried up and all but vanished. And like the carefully underestimated numbers put out by BP as to how much oil was really leaking and how much dispersant they really used to hide it all, no one actually knows just how much more bad debt is out there in the oil dark Gulf of insolvency, and how long it will take us now to clean it all up. All the while bloggers have been barking like Matt Simmons that the whole show was a sham and that there was another leak, (commercial real estate?) just a few miles off that was even bigger and threatened to create a lake of bad debt so big that it could poison the entire financial sea. Nobody listened ... They said he was off his rocker. The BOP was still there. The cap was holding. The recovery wells at the Fed were drilling and, in just a few weeks time, we could forget this moratorium of financial reform and get back to the deep water derivatives drilling again.
Meanwhile, unemployment skyrocketed and people lined up at the government trough like all the ex-shrimpers and oyster men of the Louisiana coast. The price of seafood went up and up, and the folks who lost their jobs and gave up looking have just been quietly removed from the "labor force" so we can continue to pretend unemployment is only 9.5%.
We fixed nothing; learned nothing. We just capped off the well and dispersed all that toxic debt to hide the problem. In the meantime, the banksters are gearing up for the next election in their too big to fail platforms, and when the cameras on the ROVs are finally turned off they can rub their palms in bonus money and get back to the long lost mantra of “Drill, Baby, Drill.”
Sunday, August 1, 2010
Out Of Sight, Out Of Mind
AUG 1, 2010 - A portion of the relief well has collapsed, forcing BP to retool that segment before they can be ready for a potential "Bottom Kill." Discussion on a possible "Static Kill" from the top is still being aired. Since the well is not flowing it will be easier to overcome the pressure. Yet now that the well has been capped, a lot of effort is being made to sweep the story off the news--out of sight, out of mind.
July 30, 2010 - EPA official Hugh Kaufman blew the whistle on BP and the government on MSNBC claiming that the oil that seems to have disappeared is in fact still hovering in the water column in a widely dispersed plume that is likely to remain in the Gulf for years. The amount of oil that actually reached the surface was only a small fraction of the total volume leaked. 95% or more remains beneath the surface in the vast “lake” of dispersed oil that Matt Simmons has been talking about. His claim that “We have poisoned the Gulf” certainly cannot be argued with, no matter what you may think of his other assertions. The use of Corexit dispersant, which BP rep Dudley claimed was “less toxic than dish soap”, has now caused hemorrhaging among cleanup workers and wildlife. It will remain a highly dangerous toxic element of the Gulf region, contaminating the water and rain for years. Called “we hides it” by oil industry insiders, Corexit was used to prevent oil from rising to the surface where it could be seen and threaten beaches. But this tactic also prevented it from being skimmed by ships and removed from the environment. There is no way to mitigate the remaining oil now that it has been dispersed. And I note BP continued to use Corexit even after being ordered to cease by the government, though their PR machine has been active claiming otherwise.
Kaufman believes the EPA is suppressing data on the toxicity of Corexit because “the public can’t handle” the information. “We’ve got hundreds of millions of gallons of oil spread out, mixed with 2 million gallons of dispersant,” said Kaufmann. “And so, what we have to do is accurately monitor the air and water and be very careful with the seafood. But we’ve now poisoned thousands of square miles of the Gulf... ” Other scientists are equally blunt on the subject. Toxicologist Dr. Riki Ott has advised that Gulf residents have three difficult choices now: 1) Leave the region as soon as possible, 2) Stay and wear a respirator, or 3) Become painfully ill.
July 27, 2010 - UPDATE: What’s Leaking? Thad Allen claimed the “seeps” found 3km from the BP well were from “another well,” and suggested it was the Texaco Rigel well. But an independent researcher has accurately mapped the sea floor to find that the Rigel well is only 2km from the BP site, and the area was scanned by US research ships weeks ago and found NO evidence of a seep there. According to Alexander Higgens: “Thomas Jefferson traveled directly over the area, created a highly detailed 3D model and did not detect any leaks near the well.”
Kaufman believes the EPA is suppressing data on the toxicity of Corexit because “the public can’t handle” the information. “We’ve got hundreds of millions of gallons of oil spread out, mixed with 2 million gallons of dispersant,” said Kaufmann. “And so, what we have to do is accurately monitor the air and water and be very careful with the seafood. But we’ve now poisoned thousands of square miles of the Gulf... ” Other scientists are equally blunt on the subject. Toxicologist Dr. Riki Ott has advised that Gulf residents have three difficult choices now: 1) Leave the region as soon as possible, 2) Stay and wear a respirator, or 3) Become painfully ill.
July 27, 2010 - UPDATE: What’s Leaking? Thad Allen claimed the “seeps” found 3km from the BP well were from “another well,” and suggested it was the Texaco Rigel well. But an independent researcher has accurately mapped the sea floor to find that the Rigel well is only 2km from the BP site, and the area was scanned by US research ships weeks ago and found NO evidence of a seep there. According to Alexander Higgens: “Thomas Jefferson traveled directly over the area, created a highly detailed 3D model and did not detect any leaks near the well.”
Subscribe to:
Posts (Atom)
