Yahoo Finance Can Big Oil Do More To Prevent Oil Spills?
Oil spills are very much a thing of the present and if Big Oil wants to stay successful in the green transition it will have to clean up its act. With several reports of oil spills in different areas of the world in recent years, it seems that even under mounting international pressure to respond to climate change, oil and natural gas companies are failing to implement the necessary standards to prevent these events. So, just what can energy companies do to prevent oil spills and the devastating effects that follow?
Last year, in North America, Canada's TC Energy Corp was forced to shut its Keystone pipeline in the U.S. after more than 14,000 barrels of oil spilled into a creek in Kansas. This marked the biggest spill of crude in the U.S. in almost a decade. The 662,000-bpd pipeline delivers heavy crude from Alberta in Canada to U.S. refiners in the Midwest and Gulf Coast. But this was not the first spill seen from Keystone, with other major examples in 2011, 2016, 2017, and twice in 2019. Around 12,000 barrels of oil are thought to have been spilt from Keystone since it became operational in 2010.
The spill was a result of a ruptured stretch of the pipeline. And to make matters worse, TC Energy has been accused of allowing the pressure inside parts of its Keystone system — including the stretch through Kansas — to exceed the typical maximum permitted levels in the past, which has long concerned environmentalists. However, the company stated, “At the time of the incident, the pipeline was operating within its design and regulatory approval requirements.”
Elsewhere, in the Philippines, just last month a tanker carrying 800,000 litres of industrial fuel oil sank off the coast of the Oriental Mindoro province. The oil from the MT Princess Empress has since reached the shore of fishing villages in the region and caused many people to fall sick.
The Philippines authorities have declared a state of calamity for the areas affected, as well as a fishing ban while the spill is being cleaned. The fishing ban is already having a major effect on the locals, with over 18,000 fishermen across 60 villages relying on fishing for their livelihoods. It could also harm tourism in the region. Further, the environmental risks could be huge, with the spill threatening 36,000 hectares of coral reef, mangroves, and seagrass.
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And in the U.K., around 200 barrels of reservoir fluid leaked into the Poole harbour, in the southwest of England, last week. Poole Harbour Commissioners (PHC), the harbour regulator, stated that the leak occurred at a pipeline operated by gas company Perenco. The fluid is said to consist of 85 percent water and 15 percent oil. Perenco said that some of the oil had already been recovered and much of the slick appeared to be dispersing. The company closed down and sealed the pipeline to avoid further leakage. Following the leak, thegovernment launched an investigation after MPs raised concerns about sensitive nature reserves and the impact on local fisheries. Environmental campaigners also gathered at the site to draw attention to the situation and warn of the potential impact of oil spills on the environment.
Meanwhile, in Nigeria, residents in the oil-rich Niger Delta are taking action as over 13,000 people sue oil major Shell for years of spills in the region. The health of those living in the region has been long affected by a multitude of spills that have occurred over several years, which have also threatened the livelihoods of fishermen in the region, as many fish have died in tainted waters. There have been 55 oil spills in the last 12 years, with the region now being referred to as one of the most polluted places on earth.
The court case has yet to be resolved, with worried that Shell has repeatedly escaped accountability in the past. However, in 2021, the U.K. Supreme Court unanimously ruled that there was a “good arguable case” that Shell plc, the U.K. parent company, was legally responsible for the pollution caused by its Nigerian subsidiary, Shell Petroleum Development Company and that the case would proceed in the English courts.
As we see repeated instances of oil spills all around the world, from pipelines and sea vessels, just what should energy companies be doing to prevent these events? Firstly, governments must strengthen their regulatory frameworks and give regulators the power to enforce strict standards on all energy companies to prevent spills. Oil and gas firms should be obligated to put new leak detection technologies in place, and ensure they are up to date in line with technological innovations. In addition, the development of industry-sponsored safety institutions would allow for greater research and development, to advise oil and gas operators. Companies should also be required to provide specialised training to their workers on spill prevention and be prepared to carry out emergency response measures. Finally, oil and gas companies should establish spill reduction targets and be transparent about these goals to enhance accountability.
So long as there are oil and gas operations, the unfortunate inevitability of oil spills remains, with several having been seen in the last year alone. However, there are several ways that governments and energy firms can mitigate the risk of these spills and reduce the instances of spills. By strengthening the regulatory framework and holding oil and gas companies accountable for their operational safety, future spills may be prevented and the response to equipment failures improved.
By Felicity Bradstock for Oilprice.com
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