Oil Companies Go Unpunished For Spills And Billions Of Dollars Of Gas Is Wasted
29 October, 2012
In the North Sea , oil companies go unpunished despite thousands of oil spills while because of flaring $50bn worth of gas is wasted annually.
Leo Hickman reported in The Guardian :
Oil companies operating in the North Sea have been fined for oil spills on just seven occasions since 2000, even though 4,123 separate spills were recorded over the same period, the UK Department of Energy and Climate Change (Decc) has confirmed.
The disclosure came as Decc said on Oct. 25, 2012 that the government had offered a "record-breaking" 167 new licences to oil and gas companies seeking to drill in the North Sea . A further 61 "blocks", or licences, are under environmental assessment.
Total fines resulting from prosecutions between 2000 and 2011 came to just £74,000 and no single oil company had to pay more than £20,000.
Two companies received fines of £20,000: BP, for causing 28 tones of diesel to spill into the sea in 2002 from the Forties Alpha platform, and, a year later, Total E&P, for causing six tones of diesel to enter the sea during a transfer between fuel tanks on the Alwyn North platform.
The smallest fines over this period were those imposed on two companies, Venture North Sea Oil and Knutsen OAS Shipping, of £2,000 each, after 20 tonnes of crude oil was spilt during a tanker transfer on the Kittiwake platform.
In total, 1,226 tonnes of oil were spilt into the North Sea between 2000 and 2011, according to Decc's archives. Decc said there is no "volume threshold" determining whether a company will be prosecuted over a spill at sea, although a spill of less than five tonnes is unlikely to go to court.
A tonne of crude oil is broadly equivalent to seven barrels, or, more precisely, 1,136 liters.
A Decc spokesman said: "The UK has one of the toughest and most successful oil and gas regimes in the world and we work closely with industry to ensure the highest standards of environmental protection are in place and enforced.
"There are a number of enforcement options available to Decc, with court action reserved for serious offences. On the rare occasions legal proceedings have been deemed necessary, it is for the court to decide the level of fines to hand down."
Environmental campaigners said it was worrying that Decc viewed itself as operating the global gold standard of offshore regulation, especially as oil companies were now pressing for permission to drill in extreme and vulnerable environments such as the Arctic .
Vicky Wyatt, a Greenpeace campaigner, said: "Ministers and oil companies can spout all the carefully crafted quotes they like to tell us how safe drilling at sea is. But while they're spouting these words, their rigs are all too often spouting oil into our oceans. The government should hit these companies who pollute the oceans in this way with meaningful fines.
"A few grand is not even a slap on the wrist for companies who pocket millions of pounds every hour.
"It's both staggering and wrong that some of these companies are now also drilling in the fragile and pristine Arctic, where a similar oil leak would be catastrophic."
Speaking about the issuing of new drilling licences, the energy minister, John Hayes, said: "Fortune has favored the UK . Oil and gas from our waters provides around half the energy we need to heat our homes, fuel our cars and power our industry.
"It is the single largest industrial UK investor, supporting 440,000 jobs, and benefits the UK 's trade balance to the tune of £40bn."
Fined North Sea oils spills since 2000
Kerr McGee North Sea ( UK ) Ltd – Oct. 22, 2000
Release of about 400 tones crude oil to sea from subsea pipeline: £10,000 fine.
BP Exploration Operating Company – Dec. 2, 2002
Release of approximately 28 tonnes diesel to sea due to accidental draining of fuel to open drain system and sea sump: £20,000 fine.
Total E&P UK PLC – June 17, 2003
Release of about 6 tonnes diesel after diesel transferred from tanks via valve not identified as dump valve: £20,000 fine.
Shell UK Ltd – May 12, 2003
Release of 7.5 tonnes diesel to sea during bunkering operations – return path for diesel supply system found to be closed and plant condition not as expected: £7,000 fine.
Amoco ( UK ) Exploration Company – July 1, 2004
Release of 31 tones diesel to sea from day tank during bunkering operations: £12,000 fine.
Shell UK Ltd – 10 November 2004
Release of 7.33 tonnes oil-based mud to sea during bunkering operations. £3,000 fine.
Venture North Sea Oil Ltd and Knutsen OAS Shipping AS – April 5, 2007
Release of 20 tonnes crude oil to sea from SAL [single anchor loading] during transfer onto tanker. £2,000 fine each.
John Vidal, environment editor, guardian.co.uk , reported :
Gas flaring in 20 of the world's leading oil-producing countries contributes as much to climate change as a major economy like Italy , new estimates show.
While flaring has been cut by 30% since 2005, $50bn worth of gas is still wasted annually, the World Bank said on October 24, 2012.
New satellite analysis of the flares – that are a by-product of oil drilling and which commonly light the night skies in oil fields around the world – suggests that bans and fines in some countries and the introduction of technology in newer oil fields has significantly reduced the pollution and waste in some countries, but has failed in others.
According to the bank, Azerbaijan has cut flaring by 50% in two years, Mexico by 66% and Kuwait now only flares 1% of its excess gas. Other countries, including Qatar and the Democratic Republic of the Congo , now use large volumes of previously wasted gas to generate electricity.
The bank's estimates show that flaring was reduced from 172bn cubic meters a year in 2007 to 142bn cubic meters in 2011. However, most of the reduction came between 2005-07 and only six of the world's big 20 oil-producing countries managed to actually reduce flaring in 2011.
The figures show that the momentum to reduce flaring is now leveling off with only 10% overall cuts achieved by the world's top 20 emitters since 2007 despite pledges to drastically reduce flaring.
The US , ranked fifth for highest volume in the world's gas flaring league table, increased the amount it flared by nearly 50% in 2010-2011 and has nearly tripled the amount it flares in the last five years largely because of shale oil developments in places like North Dakota . Russia , by far the world's greatest flarer, emitted 37.4bn cubic meters of gas in 2011, 1.8bn cubic meters more than the previous year.
The bank urged countries and companies to reduce flaring by at least 30% in the next five years, saying it made financial and developmental sense. "It's a realistic goal. Given the need for energy in so many countries - one in five people in the world are without electricity - we simply cannot afford to waste this gas any more," said Rachel Kyte, World Bank vice-president for sustainable development.
"This major waste of a natural resource can be turned into profitable development investments," said Sir Suma Chakrabarti, president of the European Bank for Reconstruction and Development.
Oil companies agreed that the waste of the gas which could be used for power was a problem, but said that it took time, money and technology, as well as infrastructure developments by host countries to make cuts.
Communities and non-governmental organizations in Nigeria responded to the bank's appeal by saying little had been done and alleging people were being killed by the pollution caused by some of the richest countries in the world.
"Gas flares are nothing short of crimes against humanity. They roast the skies, kill crops and poison the air. These gas stacks pump up greenhouse gases into the atmosphere, impacting the climate, placing everyone at risk. Gas flares go on because it is cheap to kill, as long as profits keep on the rise," said Nnimmo Bassey, director of Lagos-based Environmental Rights Action and chair of Friends of the Earth International.
Nigeria is the world's second largest gas flarer but despite government bans, the federal and state authorities have been unable to force companies to stop. Oil flaring was formally banned in 1984 and declared "unconstitutional" by the Nigerian supreme court in 2005, but the new figures show companies on the delta have only reduced flaring 10% since 2007.
Following is an estimated flared volume, 2007-2011 from Global Gas Flaring Reduction (GGFR) :
1. Includes N. Dakota
2. Reported much lower
3. Incl share of Neutral Zones
4. Reported much higher
Last updated: 2012-06-14
 “Oil companies going unpunished for thousands of North Sea spills”, Oct. 25, 2012, http://www.guardian.co.uk/environment/2012/oct/25/oil-companies-north-sea-spills
 “World Bank urges nations to end 'wasteful' gas flaring”, Oct. 24, 2012, http://www.guardian.co.uk/environment/2012/oct/24/world-bank-gas-flaring
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