The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas Petroleum Company (BPC) is warning that "significant and unnecessary health, safety and environmental risks" will be created if opponents now obtain a court-ordered halt to its oil drilling.

Simon Potter, the oil explorer's chief executive, alleged in an affidavit filed with the Supreme Court on Monday that it had "limited options..... to suspend or abort the drilling" of its Perseverance One well in waters 90 miles west of Andros if environmental activists succeed with their Judicial Review challenge.

With the Supreme Court due to rule tomorrow on whether Waterkeepers Bahamas and the Coalition to Protect Clifton Bay have provided sufficient evidence for the action to proceed, Mr Potter revealed that a 26-inch hole had already been drilled in the seabed by the Stena IceMAX drill ship by 8am on December 21, 2020.

"Given that drilling has now commenced into the rocks below the seabed, implementing any of these options to suspend or abort drilling at this stage would all pose potentially severe health, safety and environmental consequences, in addition to extreme logistical challenges and financial ramifications," Mr Potter alleged.

Revealing that his assertions were based on a report from BPC's drilling manager, David Bond, he added: "By virtue of the options and concerns raised by Mr Bond in his memorandum, it is my belief that the drilling operations cannot be suspended without creating significant incremental, and unnecessary, health, safety and environmental risks.

"The drilling operations have been commenced and are being conducted in strict accordance with the environmental protocols established in the Environmental Impact Assessment (EIA) and Environmental Management Plan (EMP)."

Mr Bond's December 18, 2020, report, which is attached to Mr Potter's affidavit, argued that none of the three options available to the Stena IceMAX were satisfactory from a health, environmental or logistical perspective if a Supreme Court "stay" forced it to suspend drilling operations.

Should the environmental activists succeed, he wrote that among BPC's options is for the Stena IceMAX and associated safety equipment to "hold in place" at the drilling location until the Supreme Court determines that it can proceed and complete Perseverance One.

The other two choices, Mr Bond added, were to "permanently abandon" Perseverance One before it is finished or "temporarily abandon" the well hole, then re-enter it later on to either complete the project or bring it to a total stop.

Citing his 40 years' experience in the international oil and gas industry, and role in directing the drilling of onshore and offshore wells, he wrote that it was essential to safety to protect the well hole and ensure there was no "uncontrolled" movement of fluids and gases between it and the surrounding marine environment.

Noting that Perseverance One's well hole was just 36 inches in diameter, and could already extend 1,200 metres (4,000 feet) below the seabed in the early stages of drilling, Mr Bond said: "Thus in reality, once drilling commences, if a court were to order BPC to 'stop' it would not be as simple as BPC ceasing activity with the drilling vessel and equipment moving away.

"Rushed or arbitrary removal or interruption to the presence of any or each of the 'protective measures' identified above would immediately threaten the integrity of the well, and potentially leave the seabed open to reservoirs and associated gases, fluids and influx materials."

The 'protective measures' were identified as including the "casing", or steel pipe that is cemented in then drill hole to form a barrier with nearby rocks; the blow-out preventer; and managed pressure drilling system that controls pressures "inside the wellbore".

Going through the three so-called "options" available to BPC in more detail should the Supreme Court order a halt, Mr Bond said "holding in place" would be equivalent to carrying on drilling as the Stena IceMAX and more than 100 crew would have to remain at the Perseverance One location.

Given that drilling Perseverance One was expected to be a 45-60 task, he argued that "holding in place" was not "something that can be sustained for long, if at all" given that the drill shop as well as BPC's contractors, supply boats and helicopters are all booked for work elsewhere once The Bahamas project is finished.

Noting the "financial cost and logistical challenge" would be significant, Mr Bond said BPC may be unable to secure the specialist personnel needed to properly cap Perseverance One if it took the second option of abandoning the well early.

Warning that this process would have to be "rushed", he added: "With that comes the potential for it to be ill thought through, and without all significant risks fully and thoroughly assessed. This would therefore represent a considerable increase in safety and environmental risk."

Mr Bond said the premature full abandonment of Perseverance One would see BPC forfeit the $25m spent on it to-date, while reviving the well at a later date would cost "roughly double the original $35m contemplated" to complete it.

As for temporarily abandoning the exploratory well, he suggested the drill ship could have difficulty in finding the 36-inch hole on the seabed whenever it returns. The well would also be "considerably less secure", with Mr Bond arguing that BPC cannot be held liable for "leaking materials on to the seabed".

"If drilling operations get underway and a court in The Bahamas were to then order drilling to cease, it would be completely impossible to 'stop'," Mr Bond warned. "To do so would involve removing the rig and various tiers of safety equipment, which would leave the half-drilled hole open and unprotected. It is not anything that any competent operator would ever do....

"For this reason, it would be my strongly held view that once drilling operations commence the safest, most responsible course of action would be for those operations to be allowed to run their course in accordance with the current drilling plan. Any early suspension of activities would introduce additional health, safety and environmental risk for no good technical reason."