Oil Companies Form $1 Billion Venture to Fight Deepwater Gulf Spills

Posted in Alabama Maritime News,Deepwater Horizon,Florida Maritime News,Gulf Coast,Louisiana Maritime News,Texas Maritime News on August 2, 2010

Four of the world’s biggest oil companies said Wednesday, July 28, that they have formed a new joint venture to fight deepwater gulf spills.The four oil companies are Exxon, Shell, Chevron and ConocoPhillips. Each will contribute 25 percent to a $1 billion company that would be able to mobilize a response within 24 hours to capture and contain deep-sea oil spills. The joint venture does not include BP.

According to an article at MSNBC, the companies will create a nonprofit organization called the Marine Well Containment Company to operate and maintain the response system. ExxonMobil will lead the effort and other companies will be invited to participate.



The response team should be able to start mobilizing within 24 hours of an oil spill, and be fully in place within weeks, Sara Ortwein, vice president of engineering for Exxon Mobil Development Company, told the Wall Street Journal.

Frank Verrastro, an energy expert at the Center for Strategic and International Studies, told the New York Times that such an initiative was badly needed.

“The spill exposed the fact that the industry’s capability on capture and clean-up was 1980s vintage, in part because there was so much reliance on blowout preventers,” he said. “Companies have used their technology to get into the deepwater but they didn’t have an adequate plan to intervene at these depths or to contain a large-scale spill.”

U.S. Representative Edward Markey, a Democratic member of the House Energy and Commerce Committee, said the plan was a “positive step,” but urged more attention to the prevention of future blow-outs.

“The oil companies must also invest more in technologies that will prevent fatal blowouts in the first place,” Markey said in a statement.

“While this could be a rapidly deployed system, the oil companies must do better than BP’s current apparatus with a fresh coat of paint,” he said.

Published by Houston maritime lawyer Gordon, Elias & Seely, LLP