The People of America's Oil and Natural Gas Indusry

Oil Spill Activities Converging

Jane Van Ryan

Jane Van Ryan
Posted July 30, 2010

Several activities are underway today that could have a significant impact on America's energy policy. They include congressional efforts to pass energy legislation as well as the killing of the leaking Macondo well.

Today the U.S. House of Representatives is expected to vote on the Consolidated Land, Energy, and Aquatic Resources Act of 2009 (CLEAR) Act. This bill is purported to be a response to the Gulf oil spill, but it reaches far beyond the accident.

If passed, it would impose higher energy taxes, require the federal takeover of state offshore waters, restrict offshore energy development and remove the liability cap on oil spill damages, which would exclude small- to mid-size energy companies from operating in the Gulf.

The bill is a jobs killer and API opposes it. The House is likely to recess after the vote and not return to Washington until mid-September.

The U.S. Senate is expected to take up its own energy bill next Wednesday. Politico reports that the Senate vote could be postponed if Speaker Nancy Pelosi isn't able to round up enough votes to pass the House's CLEAR Act. The Senate is scheduled to depart Washington for the August recess next week.

In the Gulf, Retired U.S. Coast Guard Adm. Thad Allen says engineers will take a two-pronged approach to kill the Macondo well starting as early as this weekend. As soon as the drilling on the relief well is completed, crews will initiate a maneuver called a "static kill," in which heavy drilling mud is pumped into the top of the well. Then using the relief well, crews will use a "bottom kill" to pump heavy mud and cement into the wellbore. The entire process is likely to take several days or possibly a few weeks.

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Transocean's Development Driller III (pictured above) is in the process of drilling the relief well Image Source: BP

Yesterday, Adm. Allen assured Gulf Coast residents that BP and the federal government will not abandon the cleanup as soon as the well is killed. The Coast Guard expects oil to continue washing up on beaches for four to six weeks.

BP's incoming CEO Bob Dudley announced today that the company is putting $100 million in a charitable fund to help unemployed rig workers. According to CNN, he also announced that James Lee Witt, President Clinton's director of the Federal Emergency Management Agency (FEMA), will be advising the company on relief efforts.