GL Noble Denton surveyed more than 100 senior oil and gas professionals regarding their comments on new US offshore regulations in the 3 years since the deepwater Macondo well blowout and resulting explosion and fire to the Deepwater Horizon semisubmersible in the Gulf of Mexico.
Survey results were outlined during the Offshore Technology Conference in Houston. Eleven people died on the semi before it eventually sank off Louisiana in April 2010. The incident resulted in a massive oil spill in the gulf. BP PLC operated the Macondo well, which has been permanently sealed. Transocean Ltd. owned the Deepwater Horizon.
Executives working the gulf said they are concerned about rising operating costs as they work in a tougher, post-Macondo regulatory regime. A copy of the survey, “Reinventing Regulation,” can be downloaded from the GL Noble Denton web site.
Of those surveyed, 85% expect the US regulatory regime will get tougher in 2 years, and 61% said the impact of the new regulations on their business had been either “somewhat” or “highly” negative.
Executives listed increased compliance costs and a greater administrative workload as the
two most significant impacts of the new regulations. Yet, many survey participants still consider the US a favorable, stable place for oil and gas operations.
Arthur Stoddart, GL Noble Denton’s executive vice-president for the Americas, said, “It is inevitable that the devastating Macondo oil spill would incur a strong regulatory reaction. No government could fail to act in the wake of such an incident.”
Acknowledging that changes are absolutely necessary to improve safety and prevent future oil spills, Stoddard said industry “will need to adapt to survive in a new climate. Increasing compliance costs, burgeoning legal risks, and a greater administrative workload are just some of the effects.”
Research shows that smaller oil and gas companies operating in the US are most likely to feel the impact of these burdens, he noted.
“Despite these challenges, there are clear opportunities for business growth in the US, and the country remains a leading operating destination for oil and gas companies. Evidence of this is seen in the strong rise in the number of on and offshore drilling permits issued to operators over the past year, suggesting a continued and healthy appetite for investment.”
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