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Review of Oil Spill Prevention and Contingency Plan 2011

  • <media 387>Download</media> as PDF (132 KB) 

For now two consecutive years there has been oil exploration drillings by the company Cairn Energy PLC (Cairn) along the coasts of Greenland. And with the recently completed drilling season for 2011 the Inuit Circumpolar Council (ICC) – Greenland finds it important to pick up on the event and experiences that both the Government of Greenland, Cairn, ICC Greenland and other organizations have made. It is a good time to stop and look at which lessons we can learn from these experiences of good and bad, and how we can use them in a prospective manner. An evaluation of the processes can help us adapt and improve these processes before any further applications for permission to do exploration drillings. ICC Greenland is of the view that there is still room for improvement.

Review of the contingency plan
Since the Government of Greenland finally chose to publish the Oil Spill Prevention and Contingency Plan in August 2010, ICC Greenland has entered into cooperation with Oceans North Canada to be able to review the contingency plan in detail. To begin with, three important elements have been selected for review by Harvey Consulting, with the aid of an independent expert who has a background as an engineer and with experience from the oil industry. The three elements are:

  • Well blowout flow rate estimates
  • Well capping capability
  • Drilling rig capability

This has concluded in three memorandums, or memos, which go through the elements using the information available in the published contingency plan and other relevant information from the public domain about the oil company, equipment and other conditions.

ICC Greenland has been informed that the contingency plan has already been reviewed by independent third parties from behalf of both Cairn and the Government of Greenland before being approved. One would therefore think that the plan already should have been assessed to be robust and realistic. However, the subsequent criticism of the contingency plan from international environmental organizations have highlighted several weaknesses in the plan. And ICC Greenland's review of the three selected elements indeed demonstrates some weaknesses. But in the light of the many sections crossed out, it is difficult to assess whether the plan is adequate, or whether it really is as flawed as it seems.

There is nothing new in the fact that the secretiveness adds in casting doubt on how robust and realistic the oil spill prevention and contingency plan is. But ICC Greenland believes it is important to pick up on these experiences and use them in a more constructive debate in order to evaluate and improve the processes. ICC Greenland calls for a more open and transparent handling of future contingency plans, to ensure that criticisms and suggestions for improvements can be met. In this way, the civil society and the rest of the world can be more confident that a potential oil spill will be handled in the best way.

About well blowout flow rate estimates
The memo on flow rate is questioning Cairn's estimates of the maximum anticipated flow rate from an uncontrolled blowout of approximately 5,000 barrels of oil per day. The expert notes two values in the calculations, which according to her experience seem too low. One is the so-called net pay zone, which describes the net thickness expected in the sandstone oil reservoir, and the second is the effective permeability, which describes the effective permeability of the sand layer. She has therefore made calculations on Cairn's worst case scenario by increasing each value gradually with numbers that she considers to be conservative and more realistic. As an example, in that way one can see that for every 10 feet that the net thickness increases, the flow rate is increased by approximately 5,000 more barrels of oil per day.

Therefore, Cairn's latest Greenland Operational Update from November 2011 is worrying to read. In it they state that in the AT7-1 well in the Atammik block 202 km from Nuuk they encountered a 113 m gross interval with 53 m of net reservoir quality sands. However, they found no evidence of presence of oil and gas in the samples from the sand reservoir – But it does not change the fact that the estimated net thickness in the worst case scenario has been greatly underestimated. Just with a sand reservoir with a net thickness of 150 feet (equivalent to 45.72 m) a potential blowout according to the calculations would have caused a flow rate of 72,870 barrels of oil per day, and even more if you calculate with the aforementioned 53 m. This is far above the approximately 5,000 barrels of oil per day, which Cairn calculated as their WORST case scenario. Although the flow rate also depends on a number of other factors, it is essential not to underestimate the worst case scenario.

In the worst case an underestimation of the flow rate would have meant that:

  • Spill-response measures could have been inadequate to address a much larger oil spill
  • An assessment of the environmental consequences of a blowout would not have taken into account the full potential scale of an oil spill
  • Any financial reassurances Cairn may have provided the Government of Greenland might not have been sufficient to cover the damage caused by a larger spill

At best, ICC Greenland can now point out that the values used in the calculations of the worst case scenario have been greatly underestimated. In future, these values should be much more conservative in order to ensure a more realistic handling of a potential blowout.

About well capping capability
According to the memo on well capping Cairn's strategy and the equipment's suitability for Arctic conditions are inadequately described in many ways. For example, Cairn estimates that they need 2-5 days to bring the well capping equipment to Greenland in a major oil spill. But the schedule does not describe in detail the individual steps in the process until it has arrived and is deployed at the site of the incident. It is necessary with a more detailed logistics plan, describing the air and sea transportation, equipment deployment and the timelines of such operations. Experience from other spills shows that it is often in the international logistics plans that delays occur and valuable time is lost.

Furthermore, a lot of information have been crossed out in the contingency plan, which seems unnecessary. Especially when most of the information is otherwise available in the public domain, so that one can make a qualified guess on the omitted information. For example, Cairn has not elaborated on which provider of well capping equipment they will use. But they already cooperate with Oil Spill Response Limited (OSRL) and they have indicated that the equipment will arrive from the United Kingdom. And OSRL has the only well capping system in the United Kingdom built for subsea wells, so it is natural to assume that this system will be used. This equipment is, among other things, designed to handle up to 75,000 barrels of oil per day at a maximum pressure of 15,000 psi. However, it is important to take into account the aforementioned underestimation of the flow rate and re-assess the strategy to be able to cope with a larger oil spill in a realistic manner.

About drilling rig capability
The third memo has focused on the drilling rig capability and how Cairn relates to international standards, recommendations and guidelines. The conclusion is that the drilling rigs meet a number of important standards from the American Bureau of Shipping (ABS) and Det Norske Veritas (DNV) respectively, depending on where the vessels were built. However, none of them comply with the recommendations of the International Maritime Organization (IMO) in their Guidelines for Ships Operating in Arctic Ice-Covered Waters from 2002 and the updated Guidelines for Ships Operating in Polar Waters from 2009. These guidelines are only recommendatory, but are targeted at addressing the handling of safety and pollution in ice-covered waters. IMO assess that, in addition to the existing requirements of the International Convention for the Safety of Life at Sea (SOLAS Convention), there is a need for consideration of further measures to take into account the special weather conditions in Arctic ice-covered waters, and to ensure appropriate standards of safety at sea and pollution prevention. It is recommended, among other things, that vessels of ice class polar class should be used in offshore exploration in Arctic waters.

Currently, Cairn or some other companies operating in Greenlandic waters are not living up to these recommended standards. Instead, the companies are trying to compensate by using vessels built for harsh environment, operate during the summer season, monitor the sea ice, use ice breakers for protection and use retreat-strategies as a last resort. And in the contingency plan Cairn has indicated that their drilling season last until December 1, but admits that with the chosen vessels it may not be possible to drill in November, depending on the weather conditions. These compensations are inadequate in ICC Greenland's opinion, especially taking into account the vulnerable Arctic environment and ecosystem, and the importance of the living resources for the population and the culture. In accordance with the principles of best available techniques (BAT) and the best environmental practice (BEP) ICC Greenland recommends that the guidelines of IMO are followed when ships are to operate in Arctic waters.

Arctic Council and Oil Spills
In the Arctic Council there is also an increasing focus on the risks of oil spills, hence representatives of the eight Arctic States met in Saint Petersburg in Russia in mid-December 2011 to discuss how to handle transboundary oil spills. The working group Oil Spill Preparedness and Response Task Force (OSTF) has, among other things, a goal to frame a future instrument between the countries, called the Arctic Marine Oil Pollution Preparedness and Response. The aim is to improve the communication and cooperation so that the countries can more effectively monitor oil spills, and request or provide assistance, including personnel and equipment for control and clean up oil spills in Arctic waters. ICC Greenland was represented as a Permanent Participant of the Indigenous Peoples Organizations. At the meeting several topics were discussed, such as whether the instrument should be binding or not, about joint emergency plans and planned exercises, about special border control and visa rules, about transparency and information to the local communities affected by the oil spill, and what kind of releases that the instrument would apply for. Unfortunately, there was still little support for the earlier proposal of the Danish/Greenlandic delegation about an international oil spill fund, but Denmark and Greenland will patiently work forward on other fronts to spread the idea and increase the support in the long run. ICC Greenland will also continue to work on raising the standards and ensuring a strong instrument with good transparency and involvement of the population. Next meeting will be held in Alaska in March 2012, and it is expected that the negotiations on the instrument are completed at latest December 2012.

Capacity building
In the resource area Greenland is undergoing a rapid development following the increasing interest in our potential resources from the rest of the world. And during this development it is important to ensure that the structuring of institutions and laws are following the democratic rules. There is still a lack of guidelines and a desire for better procedures in several areas. And there is yet no parliamentary control of BMP's activities, which is otherwise standard in most of the countries that we want to compare ourselves with. Fortunately, there is also an increased focus, including from Transparency Greenland, on openness, transparency and structuring of the systems so they are less vulnerable to corruption. The Government of Greenland is still undergoing a capacity building process, and so is ICC Greenland as an organization. It is our intention to be able to contribute with independent third party assessments for the Government of Greenland and other civil society organizations, with the help of international experts. However, ICC Greenland and other organizations still have needs of financial support to ensure the necessary capacity building and continued participation in the consultation processes. In the long term, strengthening of NGO's and other civil society organizations will help strengthen the dialogue with the Government of Greenland and provide valuable input to the processes, so that a more balanced development takes place on the resource area. For this purpose, the establishment of a fund with an independent board could be a way to support this work and add the arm's length principle between the sponsors of the fund and the work of the organizations.

ICC Greenland proposes, in relation to the oil spill prevention and contingency plan, that it will henceforth be put out for public consultation before a project is approved, in the same way as the Environmental Impact Assessment (EIA) and the Social Impact Assessment (SIA). Thus, the Government of Greenland can meet any criticism in a more constructive way, and the civil society and organizations can ensure that the contingency plan is well thought out, realistic and credible. And only an absolute minimum of sensitive information should be crossed out, with the rest of the contingency plan fully public. There is still room for improvement, and ICC Greenland would like a constructive dialogue with the Government of Greenland and other organizations to improve these processes.

The three memos (in English) as well as a summary of these (in English, Danish and Greenlandic) can be downloaded as a PDF here:

  • Rig Capability <media 370 - - "APPLICATION, 9-18-11 Pew Cairn Greenland Rig Capability-1, 9-18-11_Pew_Cairn_Greenland_Rig_Capability-1.pdf, 52 KB">Memo</media> (English)
  • Well Capping <media 369 - - "APPLICATION, 9-15-11 Pew Cairn Greenland Spill Plan Well Capping Memo-2, 9-15-11_Pew_Cairn_Greenland_Spill_Plan_Well_Capping_Memo-2.pdf, 25 KB">Memo</media> (English)
  • Blowout Rate <media 371 - - "APPLICATION, 9-19-11 Pew Cairn Greenland Blowout Rate, 9-19-11_Pew_Cairn_Greenland_Blowout_Rate.pdf, 93 KB">Memo</media> (English)
  • Brief Summary of <media 373 - - "APPLICATION, ICC-ONC Summary Cairn OSCP memos 2011 EN, ICC-ONC_Summary_Cairn_OSCP_memos_2011_EN.pdf, 1.3 MB">Memos</media> (English)
  • Brief Summary of <media 374 - - "APPLICATION, ICC-ONC Summary Cairn OSCP memos 2011 GL, ICC-ONC_Summary_Cairn_OSCP_memos_2011_GL.pdf, 69 KB">Memos</media> (Kalaallisut)
  • Brief Summary of <media 372 - - "APPLICATION, ICC-ONC Summary Cairn OSCP memos 2011 DK, ICC-ONC_Summary_Cairn_OSCP_memos_2011_DK.pdf, 78 KB">Memos</media> (Dansk)