A downloadable audio file of the conference is available here; a transcript of the event follows:
June 28, 2010
1:15 p.m. CT
Adm. Thad Allen: … (inaudible) over about five foot of sea (inaudible) they’re going to have to stop the preparations for the Helix Producer, which was the third production vessel we were going to bring in on the 30th of June to hook to the new vertical riser to increase our production up to 53,000 barrels per day by the end of June. That will be conditions-based, based on the sea state, and we’ll provide you a day-to-day update on that.
Regarding our production in the last 24 hours, ending at midnight last night, we were able to produce 24,455 barrels with a combination of the Discoverer Enterprise and the Q4000. Regarding the relief well operations, the Development Driller III, which is a relief well driller, is down to 11,286 feet below the mud line.
They are beginning their third ranging exercise. That is the exercise where they lower an electrical cord down and, after they withdraw the drill pipe, lower the electric cord down and then search for the electromagnetic field surrounding the wellbore and slowly start to close in. This will be happening for the next several weeks as we try and refine the distance to the wellbore to the point where we can actually intercept and drill the relief well in, inject the mud into the cement plug, which will effectively bottom kill the well.
And with that, I’ll finish my comments. Secretary Napolitano…
Napolitano: Thank you. Thank you, Admiral Allen and Carol for a very productive meeting and session here today. I think this is my sixth time to the Gulf since the spill began. It is important that we continue to inspect everything that we are doing to keep oil off of our vital shorelines, and to clean it up when it hits.
As we all know, there is no precedent for a leak of this size and at this depth. The damage continues to unfold over the course of days, weeks, and now months. And it’s not hours or days, which is the way one normally thinks of an oil spill. And, of course, a disaster of this size leads to unforeseen challenges.
I want to emphasize that, throughout this evolving event, we have marshaled the largest response in this nation’s history, and we have continued to adapt at every turn as the disaster itself has evolved. We have created redundancy wherever possible, from directing BP to employ additional methods to contain this leaking oil to finding new ways to keep the oil off of our shorelines, to using multiple scientific methodologies to gauge the size of the catastrophe. Part of the reason for our visit here today was to make sure that these efforts continue to be as effective as possible, given new and evolving challenges, such as the arrival of hurricane season.
It’s also important that everyone understand that the response has grown at every turn since its beginning. About 37,000 personnel are working around the clock to protect the shoreline and to clean up the coast. More than 6,500 vessels are engaged, including thousands of locally-owned boats. About 80,000 claims have been opened so far, and, as you know, President Obama was able to receive from BP a guarantee to establish a $20 billion escrow fund dedicated to paying claims that stem from this disaster. And we have encouraged BP to create additional redundancies in the way that they contain the leaking oil.
Since the beginning, we have dedicated resources to this spill, as if the worst-case scenarios would become true. We have spared no effort. We will spare no effort. Our priorities continue to be making sure that BP stops the leak as quickly as possible, making sure that delicate shorelines are protected to the greatest extent possible, and making sure that the damage is cleaned up and the claims are paid. No response will be finished until these things are done.
So we know that for many affected communities here in the Gulf, the process of recovery will last a long time. We are in the middle of a long effort. We will, and are, working in close partnership with our state and local authorities, ensuring that they have the resources they need to meet the evolving threat from this oil spill. This has included daily outreach from top officials to local leaders, meetings and calls with the President, and dedicated federal liaison officers placed in local areas to coordinate closely with local governments and communities as they meet the needs of their constituencies.
The federal government will be working as long as it takes to make sure, as I said before, that BP stops the leak; that we clean up the damages; and that the claims are paid. Everyone has to continue the effort they’ve already expended, and more, at this continued and evolving catastrophe. We will not stop until the leak is plugged, the oil is cleaned, and the claims are paid. Thank you very much.
Male: Admiral? (Inaudible). Admiral, how confident are you that the relief well has (inaudible) fill the well (inaudible).
Thad Allen: Well the current plan is for Development Driller III to go low enough, just above the reservoir area, where we will intercept this at the optimal point to let us then drill – or insert mud into the wellbore, including going up. There have been some concerns in the past about the condition of the wellbore further up, but this is well below that.
As a risk mitigator, we have started Development Driller II, which is developing – drilling the second relief well. We’re also exploring the potential, and we are not at closure yet, on whether or not we could use pipelines to actually transfer the oil from the wellhead to other facilities nearby. And that’s still under conceptual review, both at BP and in the – and in the government right now.
Male: (Inaudible).
Thad Allen: Well we’re doing that anyway, because that’s another alternate source of production and redundancy.
Male: (Inaudible).
Thad Allen: We talked about kinetic action down there before. I think that needs to be very closely scrutinized around the other implications with the (strata) around there are implications for other long-term problems. And I don’t think we’re going there at this point.
Male: (Inaudible).
Thad Allen: Well, the Jefferson Parish officials actually briefed myself and the President on this in his trip to Grand Isle. We subsequently met with the officials down there. There’s some really complicating factors that need to be taken into account, one of which are underground pipelines. They’re going through some of those passes and the environmental impact of actually closing off the water flows there.
They’d actually talked about an intermediate system where we could do a combination of barges, pilings and booms that would allow us to be able to stop the oil, but also allow the free flow of the (a lot of these) to come and go to maintain the ecosystem. We – I think we came up with a mutually agreeable plan – it’s a matter of executing, and it is a combination of barges and other equipment, including booms and pilings.
Male: (Inaudible).
Thad Allen: Yes, there – there are variations on the same theme. But we’re putting permanent infrastructure in that can support either barges or a permanent booming to give it more durability than a regular ocean boom, which does not survive out there. Variations on the same theme, and we are working very closely with both local governments to do that.
Female: (Inaudible).
Thad Allen: Well there’s no plan with anybody right now, because we haven’t met the threshold. The current speed and direction and wind strength of Alex does not indicate that we should do anything regarding evacuation. The only impact we’re seeing right now is an increase in sea state that’s going to inhibit potentially the preparations we need to bring the third production vessel online. We have a set of criteria by which if we thought we’re going to get gale force winds in 120 hours, we would start to redeploy that equipment, but those criteria are not met in this current storm.
Female: (Inaudible).
Thad Allen: Let me take your first question. We have not seen any oil being pushed much further inland. We have seen the oil change direction. It was generally heading east to the panhandle of Florida. Because of wave conditions and current we now see oil start entering Mississippi sound and areas around Chandelier and Breton Sound. We’re very concerned about that. We’re moving forces there as we speak.
Any kind of a surge from a storm would, obviously, exacerbate the oil, move it further into marshes, and would cause problems for us. So we’re going to face that potential throughout the hurricane season should we have any kind of heavy weather.
Regarding the relief wells, if we have to evacuate the site because of a hurricane, we estimate that there could be a break of about 14 days to take down the equipment, move it off to a safe place, and then bring it back and reestablish the drilling.
Female: (Inaudible).
Thad Allen: Well if we have the (inaudible) coming offsite because of a hurricane, there will be an interruption. I’m not here to postulate on if and when a hurricane will hit, because I don’t think we know. We’re watching very, very closely, and we know what the approximate impact would be if we had to do it, and that would be about 14 days.
Female: (Inaudible).
Thad Allen: Well, I think we’re all hopeful that we’ll get a break from the weather. I’m not saying we’re not going to have to redeploy if the weather comes, but, as it stands right now, absent intervention because of a hurricane, we’re still looking at mid-August.
Male: (Inaudible).
Thad Allen: I don’t think so. The last thousand feet or so that they have to do to penetrate the well has to be done very slowly. They’ll drill several hundred feet, they’ll pull the drill bit back, they’ll put an electronic sensing device down. They’ll find where the magnetic field is and expose it very, very gently.
What you don’t want to do is inadvertently hit that wellbore and somehow nick it. And, for that reason, there’s actually a second vessel standing by with mud; should that accidently happen, they could actually put mud into the well. But they’re trying very, very hard to come very, very close before they make that final entry.
Female: (Inaudible).
Napolitano: Well it is (inaudible) because the well isn’t plugged yet. And that is BP’s responsibility to close that well. But, in terms of the assemblage of vessels on the surface of the sea, in terms of getting control of and taking control of the airspace over the Gulf of Mexico, so that we can control not only the airspace and avoid mid-air collisions, given the number of aircraft that are down here. But also have control from the air to the sea, so the planes spot the oil, they can direct vessels to where the oil is to get it skimmed and to pick it up. And then, also, to muster really a record number of personnel on the shoreline ready to clean up oil if and when it gets there.
Now, I think that’s an important point, because the effort on the surface of the sea has actually kept a lot of oil from reaching the shoreline, given that this is day – I don’t know – they blend together – 69 or 70, since the rig sank. So we keep battling that oil on the surface, we’ll battle it on the shoreline, and then, where there needs to be cleanup, we’ll work with state and local authorities for the cleanup and to get the damages paid.
Female: (Inaudible).
Napolitano: We’re still using dispersants. That’s done in a coordinated decision with the Coast Guard and the EPA. But there is a coordinated use of dispersants.
Moderator: At this point, were going to open the call (inaudible) Operator, do you have any callers on the line for me?
Operator: You do have a question from Kate Spinner.
Kate Spinner: Hi. Im not sure if youve answered this already, but I was wondering was this a wave action expected from tropical storm Alex is going to delay any of your response activities?
Thad Allen: (Inaudible) actual impact of Alex passing by could produce seas of 10 to 12 feet sometime in the next 36 hours or so. The only impact that will have on the operations will be a potential delay of the any preparations through the Helix Producer which will be the third production vessel that would take us to a capacity of 53,000 barrels by the end of the month of June. And it will allow us to move sometime in July, and we’re tracking that very close right now.
Kate Spinner: OK.
Operator: Your next question comes from Kristin Hayes.
Kristin Hayes: Hi. Thank you for taking my question. I understand youre going to be meeting on Wednesday with Secretaries Chu and Salazar on if, in fact, were you going to be making the final decision on whether to switch the caps? And is it still possibly you might not switch?
Napolitano: There will be a meeting in the Secretary of Interior’s office involving the science team that has been working on this spill including Secretary Chu and others. There they will be doing an analysis the second or alternative types of containment cap and whether or not that makes sense in light of the amount of oil that could be collected with a third vessel they’re getting ready to hook up.
So there is that meeting and really is evidence, once again, continue adaptation and accordance with the involving nature of this spill. And as that new methodology get developed – even in the course of this spill to apply the containment.
Operator: Your next question comes from Harry Webber.
Harry Webber: Yes. Harry Webber at the Associated Press. Admiral Allen just so I understand you correctly, are you saying that if a hurricane forced an evacuation of the workers drilling the relief well, that could shut down those operations for roughly 14 days based on the amount of time that it would take to move the equipment?
And two, have you had to move any equipment at all thats being used in the containment zone because of the tropical weather that we heard about?
Thad Allen: Thats correct. The current action that we have right now if we had to break production and stop drilling will be 14 days. There is no impact on the current relief wells that are being drilled on the production right now as a result of the weather thats passing. Though the impact were having right now is delay in the preparation (inaudible) production online. So the product of 53,000 barrels by the end of June will be sometime in early July and were monitoring it.
Harry Webber: Thank you.
Operator: Again, to ask a question, press star, then the number one. Your next question comes from Richard Harris.
Richard Harris: Hi. Admiral Allen, I wonder if you could tell us how rough the seas have to get before the Enterprise has to pull off the well? I think previously you said that once there are 8-foot seas, the cap has to come off. The ship has to move off the wellhead. Is that still your estimate, and if so, it sounds like were getting close to that possibly.
Thad Allen: Well, actually there’s two different thresholds for the Discover Enterprise. One is their ability to lighter the tanker ship that takes oil ashore, and that is actually five to six feet and theyve already lightered and that they can go for eight days.
It depends on the riser piper connection right now. We will become concerned around 12 feet. The decision actually disconnect the cap from the riser would be something that would be made independent, and wed be consulting with BP, the folks on the scene and the others including wind.
Richard Harris: All right. Thanks.
Operator: Your next question comes from Paula Dietrich.
Paula Dietrich: Hi. Thanks, Admiral, for taking my question. I was also wondering about if this height of the waves could impact the collection efforts over the next few days.
Thad Allen: We dont think so at this point. Were closely monitoring it.
Female: Operator, that was our final question. Thank you. Thank you very much.
Thad Allen: Thanks very much.
Female: Stay cool.
Operator: This concludes todays conference call. You may now disconnect.
END