Offshore Drilling in West Greenland, Relief Well Planning 1. Current Relief Well Drilling Requirements for Offshore Drilling in West Greenland The Government of Greenland requires offshore drilling operations to be supported with two drilling rigs to ensure that one of the drilling rigs can provide relief well drilling services in the event that a blowout occurs while drilling with the other rig. The two-rig policy also requires that drilling must stop with sufficient time to allow enough time to drill a relief well in the same drilling season before ice and harsh Arctic weather make well drilling unworkable. The Government of Greenland’s two-rig relief well drilling policy, requiring the capability to drill a same-season relief well is an international best practice for drilling in Arctic waters. This international best practice is also in place in Canada and the United States. 2. Current Relief Well Drilling Requirements in the Canadian Arctic Canada’s National Energy Board requires offshore drilling operations to have two-drilling rigs operating offshore to ensure that at least one rig is capable of drilling a relief well to kill an out-of-control well during the same drilling season (commonly referred to as the “sameseason-relief-capability.”)1 In 2010, after the United States Gulf of Mexico well blowout, the National Energy Board of Canada reviewed its offshore drilling safety and environmental requirements for offshore drilling in Canada’s Arctic (“the Arctic Review”).2 The Arctic Review reaffirmed Canada’s requirement for a two-rig, same-season relief well capability, despite substantial industry pressure to relieve this requirement. While Chevron,3 BP,4 Imperial Oil,5 and ConocoPhillips6 all heavily lobbied the Canadian National Energy Board to relax its two-rig, same-season relief well policy, no company has been successful. 3. Current Relief Well Drilling Requirements in United States Arctic 1 Canada National Energy Board (NEB), Filing Requirements for Offshore Drilling in the Canadian Arctic, 2011. 2 Canada, National Energy Board, Backgrounder- National Energy Board Report on the Arctic Offshore Drilling Review, http://www.neb-one.gc.ca/clf-nsi/rthnb/pplctnsbfrthnb/rctcffshrdrllngrvw/fnlrprt2011/bckgrndr-eng.html, accessed May 2013. 3 Chevron Canada Limited, Submission to the National Energy Board Policy Hearing for Same Season Relief Well Capability for Drilling in the Beaufort Sea, March 2010. 4 BP Exploration Operating Company Limited, National Energy Board, Hearing Order MH-1-2010, Review of Policy on Same Season Relief Well Capability for Drilling in the Beaufort Sea, Written Submission, March 2012. 5 Imperial Oil Resources Ventures Limited, Calgary, Submission Regarding the Relief Well Policy for Offshore Drilling in Arctic Waters, March 2010. ConocoPhillips Canada, Letter to the Canadian National Energy Board, Re: ConocoPhillips’ Submission in accordance with NEB Hearing Order MH-1-2010 Same Season Relief Well Capability for Drilling in the Beaufort Sea (NEB File OF-EP-Well 05), March 19, 2010. 6 The United States, Department of Interior, requires offshore drilling operations to have tworigs operating offshore at the same time to ensure that at least one rig is available and capable of drilling a relief well during the same drilling season. Shell’s 2012 Chukchi and Beaufort Sea drilling campaign was the most recent approval of offshore drilling in the United States Arctic. The United States required Shell to have two drilling rigs located in the Arctic capable of drilling both the planned wells, and a relief well.7 The United States also required that Shell stop drilling the planned wells, in order to leave sufficient time to drill a relief well during the same drilling season. In 2012, ConocoPhillips proposed to drill in the Chukchi Sea using a single jack-up drilling rig, without a second drilling rig and without the capability to drill a same season relief well.8 The United States Department of Interior held firm on its requirement for a second drilling rig, and the capability to drill a same-season relief well. 4. Industry’s Request to Relax the Greenland Relief Well Drilling Policy Recent reports suggest that the Greenland Oil Industry Association (GOIA) and/or its members may be requesting the Government of Greenland to relax the two- rig, same-season relief well requirement. Canada and the United States, thus far, have rejected proposals to eliminate the two-rig, same-season relief well requirement because there are some circumstances where surface intervention methods are not successful necessitating a relief well. If rapid initiation of relief well drilling is not commenced in the Arctic, and the well is not brought under control during that drilling season, the well blowout could continue unabated during an entire winter season. A blowout persisting through a winter season in the Arctic could be eight to nine months long, resulting in ecological damage of catastrophic proportions. Some operators have proposed drilling a relief well using the same rig that drilled the blown out well. This is an unsafe, risky proposal because drilling rigs and control systems that caused the well blowout malfunctioned, and are typically damaged by fire and explosion, sunk or otherwise unsafe to immediately operate after a well blowout. During a well blowout, personnel are evacuated from the rig as soon as possible. Re-boarding a rig involved in a well blowout to move the rig to another drilling location is usually not safe. Moreover, it would not be prudent to use a drilling rig and blowout control system that just failed, to drill a relief well, until the rig was carefully inspected and verified to be safe and reliable to drill another well. For example, the two most recent well blowouts, the 2009 Timor Sea Montara well blowout and the 2012 Gulf of Mexico Macondo well blowout both resulted in fire and explosions that damaged the rigs. The Montara well blowout damaged the rig to the point that Australian authorities would not authorize anyone to re-board the offshore platform until the relief well was drilled and the well blowout was controlled. The Macondo rig caught fire and sunk to the seafloor. United States, Department of Interior Approval of Shell’s 2012 Chukchi Sea Exploration Plan and United States, Department of Interior Approval of Shell’s 2012 Beaufort Sea Exploration Plan. 7 8 ConocoPhillips 2012 Chukchi Sea Exploration Plan. In 2012, Nuka Research and Planning Group, LLC reported that it reviewed all available data about well blowouts worldwide and did not find a single example of a drill ship drilling its own relief well after blowing out.9 Clearly, this is not a safe or reliable plan. 5. Well Blowout Control Methods – When is a Relief Well Needed? A relief well is the most reliable method of controlling a well blowout and is typically the last resort for well control when surface intervention methods fail. Drilling relief wells can take longer than well capping. However, because well capping operations are not always successful, well capping and relief well drilling operations are typically commenced in parallel. The relief well drilling operations can be stopped if surface intervention methods are successful before the relief well operations are complete. If a well cannot be controlled using surface intervention methods, a relief well must be drilled. Approximately 90-95% of all well blowouts are solved by the well bridging on its own or by surface intervention methods.10,11 However, historical data shows that there is a 5-10% chance that a relief well may be needed to control the blowout and the operator needs to be prepared for that potential situation. 9 Nuka Research and Planning Group, LLC and Pearson Consulting, LLC , Oil Spill Prevention and Response in the U.S. Arctic Ocean, Unexamined Risks, Unacceptable Consequences, November 2010., p. 96. 10 Pidcock, G.A., and Fowler, D.R. (Gulf Canada Resources Ltd.), Relief Well Contingency Drilling Plans for Remote Areas, SPE/IADC Drilling Conference Paper No. 21997, 1991. 11 Skalle, P., and Trondheim, J.H. (Southwest Petroleum Institute), and Nanchong, P. (UT Austin), Killing Methods and Consequences of 1120 Gulf Blowouts During 1960-1996, Society of Petroleum Engineers Paper No. 53974, 1999.