Exxon Spill Spells Pipeline Problems

Everyone remembers the Exxon Valdez tanker ship and Deepwater Horizon drilling platform—both spilled millions of barrels worth of oil into Alaskan and Mexican waters, respectively, killing thousands of animals and severely impacting local environments. It’s no surprise, then, that both consumers and government agencies now watch oil companies very closely, and as a recent Exxon Mobil spill in California demonstrates state decision-makers aren’t afraid to shut down operations as required.

Plan To Fail

According to U.S. Coast Guard Lt. Matthew Mitchell, oil spills are a matter of “when”, not “if”. That’s why the Bering Strait region developed a contingency plan to limit the damage caused by burst pipelines or damaged oil rigs—according to the Alaska Dispatch News, while the plan isn’t due for an update until 2017, Lt. Mitchell hopes to fast-track the process for next year and ensure that both local community and coast guard resources are quickly brought to bear in the event of a spill.

The message is clear: Alaska knows that oil doesn’t always flow where it should and is making efforts to ensure the longevity of its unique coastal environment. But as noted by The Guardian, other states like California are doing more than just drafting plans to mitigate disaster. Instead, they’re taking the fight to oil companies directly—if there’s a spill, consequences are swift and certain.

No Flow

In May, three Exxon Mobil platforms were shut down after a spill saw 101,000 gallons of crude dumped into the sea off Santa Barbara. What’s more, the country rejected an emergency application by Exxon to truck the oil, saying the “the company’s problem did not constitute an emergency so it could go through normal procedure,” which in this case requires extensive environmental review before any trucking is permitted.

So why the stonewall? Because the spill wasn’t caused by an act of nature or earthquake but rather a severely corroded pipe which gave way and began spewing crude oil into the water. Opponents argue that refusing a truck permit denies Santa Barbara much-needed taxes whenever rigs are shut down, while legislators looking for greater accountability from big oil see the move as show of confidence by the county when it comes to protecting environmental resources.

What does all this mean for oil companies? It’s simple: Whether you’re operating a pipeline, offshore rig, shipping crude or simply involved in the maintenance side of oil distribution, government agencies are no longer willing to look the other way if spills happen, nor will they allow “business as usual” to continue simply as a way to generate tax revenue.

Instead, there’s a crackdown happening on production until companies can prove they’re taking steps to maintain oil delivery systems both moment-to-moment and over the long term. In other words, regular cleaning and maintenance are no longer performed only to meet minimum government requirements and reduce spend on new physical components but as a key component in revenue strategy: Damaged pipes drive profit into the ground.

States are taking steps to protect their interests when it comes to big oil. In Alaska, this means preparing for the worst; in California, legislators are now holding companies accountable to do their very best.

Next Steps:

One comment

  • Informative article. I think it is good news that the government’s surrounding the oil companies should be more concerned about the environment then revenue. Hopefully, the repercussions of an oil spill are worse then the cost of avoiding the the spill.

    October 16, 2015

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