A View from the Big “Greasy”

I am no expert on oil exploration or the environment, and I have not followed every detail of the now catastrophic BP oil spill in the Gulf of Mexico. However, I am a lawyer and lifelong resident of New Orleans, formerly known as the “Big Easy” but now more accurately called the “Big Greasy”. Therefore, I am by definition sitting in the midst of the worst oil spill disaster in U.S. history and on top of that, a massive SNAFU. The following are my thoughts:

I. The Katrina Parallel

President Obama is no more responsible for the BP oil leak than President Bush was responsible for the fact that Hurricane Katrina hit New Orleans. However, the rather slow, lumbering response of the Bush administration was quick and effective compared to the Obama administration’s lack of any effective response at all. Both responses indicate that the federal government is an immobile, top-heavy bureaucracy that is incapable of dealing with emergencies in a fast, effective manner.

II. Obama’s Non-Response

Why do I say that Bush’s response was quick and effective compared to Obama’s?

President Bush had to deal principally with two incompetent Democrat politicians on the state and local levels. The first was Governor Kathleen “MeeMaw” Blanco, who dithered and hesitated for about a day and a half before she agreed to allow the National Guard to be nationalized (or some such bureaucratic nonsense) so that the Feds could take control of the situation in New Orleans. On the local level, Bush had to deal with New Orleans Mayor C. Ray Nagin, a blithering idiot who could have commandeered hundreds of school buses to use for evacuation but did not do so. Nagin also estimated the dead at 10,000 on television, when the actual number from the entire state of Louisiana was about 1,577, including those evacuees who died in the aftermath or evacuation and whose deaths were nonetheless attributed to the storm.

On the other hand, Obama now has to deal with two Republican politicians on the state and local level: Bobby Jindal, who almost always seems to be in control of any situation in which he finds himself; and Billy Nungesser, president of Plaquemines Parish, the most affected area so far, who has shown himself to be capable in the face of the spill and dealing with the Feds and who should be elected to statewide office. On approximately April 23 Jindal and Nungesser began asking—more accurately begging—the Army Corps of Engineers and the Coast Guard to allow the dredging of sand berms along and between barrier islands in order to keep the oil out of the marshes. The federal government waited about 39 days and did not approve the dredging to begin until June 2, 2010. Actually, the Feds gave the go ahead for the berms last week but as of June 2 have only forced BP to pay for 45 miles of the requested 90 miles of berms. Thus, effectively the Feds have still approved only about half of the berms. In the meantime, the oil has intruded into about 3,000 acres of marsh; and of course, the berms are going to take time to dredge.

Most of southeast Louisiana is swamps and marshland. We call the soil in the marshes “coffee grinds” because it has the consistency of used coffee grinds. It is absolutely imperative to keep the oil out of the marsh because there is no question that the oil will destroy the marsh ecosystem for decades to come. In Alaska after the Exxon Valdez disaster, we all saw the pictures of workers pressure washing the beach rocks. We have also seen pictures of workers cleaning sand beaches in other oil spill disasters. In southeast Louisiana such remediation is impossible. What are we going to do, wipe off every blade of marsh grass? The incredibly fertile wetlands and their abundant fish and wildlife will be dead before 100 acres are cleaned.

In view of these facts, the federal government’s excuse for the delay in giving the go ahead for the sand berms is asinine: the Feds delayed the sand berms in order to review their environmental impact (I’m not kidding), even as the oil was hitting the coast and getting into the marsh.

Similarly, immediately after the spill the federal government had a protocol for dealing with a spill of this type: the oil could have been burned in the water. Such burning was pre-approved by the government; but after a token burn that was successful, no further burning has taken place, again because of environmental concerns, even as the oil is now about to hit the beaches of the Florida panhandle, which are among the most beautiful on the planet.

Keep in mind that Obama could have ordered the dredging and can order the burning any time he wants by executive order and/or under specific statutes such as the Oil Pollution Act of 1990. Also, he could commandeer barges and supertankers to suck the oil out of the Gulf of Mexico. Under this process, the oil is sucked up and separated from the water on the tankers, the water is pumped back into the Gulf, and the oil is then pumped into barges and taken to refineries. This technique has been used very successfully in the Middle East, but it is not being used in the Gulf. Why? For that matter, why doesn’t BP try it without being ordered to do so?

Obama made a mistake when he got on television last week during BP’s “top kill” operation and at least to some extent tried to say that he was in control of the efforts to stop the leak, in order, obviously, to take credit. Obama made his pitch before BP announced that the top kill was successful, and unfortunately, the top kill turned out to be a failure. Obama looked ridiculous.

To the dismay of those who voted for him, Obama is not the Messiah. BP and other oil companies have the expertise to deal with oil wells and blowouts, and the federal government does not. Obama’s latest solution is to hire James Cameron, the Hollywood movie director (I’m not kidding about this, either). Obama now looks more ridiculous.


III. The Drilling Moratorium and the Economic Impact

On Tuesday, June 1, 2010, Obama and the Department of the Interior instituted a six month moratorium on all wells drilling in more than 500 feet of water. No one that I know of in Louisiana thinks such moratorium is a good idea. Nevertheless, it makes Obama look like he is doing something instead of listening to Paul McCartney sing to his wife, playing golf, or honoring NCAA basketball champions (Obama was in Louisiana the other day for three hours; he spent more time than that last week at a fundraiser for Barbara Boxer).

The moratorium makes no sense. According to articles in New Orleans’ The Times-Picayune newspaper on June 2 and 3, 2010, about 33% of the United States’ domestically produced oil and 10% of the natural gas come from the Gulf of Mexico; and 80% of the oil and 45% of the natural gas produced in the Gulf come from wells in more than 500 feet of water.

Why are we drilling in such deep water, which is obviously more risky? Isn’t there any oil anywhere else? Yes, but since the Feds won’t allow drilling off Florida, the Eastern seaboard, California and the rest of the Pacific coast, or in ANWAR, the oil companies have to go deeper to get the oil that the whole country needs. The bottom line is that if Obama thinks it’s safe to drill in depths of 500 feet or less, then he should open up those areas for drilling. If not, then he should close all wells, not just the ones in depths greater than 500 feet.

The moratorium will close about 33 wells, which I understand is about 40% of the wells presently being drilled in the Gulf. The economic impact of the moratorium alone may begin to affect the whole country’s economy. Each rig directly employs 180 to 280 workers for a total of about 7,590 jobs that will be lost, meaning tens of millions of dollars in lost wages per month. Of course, that calculation doesn’t include all the indirect jobs that will be lost, such as caterers, cooks, support personnel, helicopter pilots and support personnel, the boat crews who service the rigs, etc., etc.

According to The Times Picayune, rigs rent for $250,000 to $500,000 per day, so if they sit idle for the whole six month moratorium, about $2.97 billion in lost rent and costs will be incurred by their owners. The owners, therefore, will move the rigs to foreign countries and keep them working. The Offshore Marine Service Association believes it might be two years before the rigs would return to the Gulf (if ever). Thus, there will be a long term if not permanent loss of drilling in the Gulf, but then again, Obama is no friend of the oil industry anyway. To paraphrase Rahm Emanuel, “We can’t let this crisis go to waste.”

The effect on fisheries and the culture of Louisiana, the “Sportsman’s Paradise”, will be worse yet. We are only now fully recovering from Katrina. If the oil spill continues and the oil comes into the marshes and estuaries, tens of thousands of people will be affected: fishermen, oystermen, shrimpers, processors, truckers, restaurant owners and workers, etc. In Grand Isle, which is directly on the Gulf, for example, some business owners are already saying that if they have to close again, this time they won’t re-open.

Ironically, the futility of Florida’s ban on drilling is about to become obvious. Yesterday the oil was four miles off the coast of the Florida panhandle, which is packed with hotels, condos, and rental houses and is a tourist economy from one end to the other, as are the coasts of Mississippi and Alabama. People generally do not go to beaches covered with petroleum (other than my mother-in-law, who says she’s going to the beach this summer even if she has to sit in oil. I want to photograph that sight, so I may go also). Again, tens of thousands or even hundreds of thousands of jobs will be affected, and mortgage payments on condos and rental properties will not be made.

IV. Conclusion

There are a couple bright spots. It really pains me, but I’ll give credit where credit is due: Democrat Sens. Schumer and Wyden have sponsored a bill to prohibit BP from paying any dividends until the spill is cleaned up and all damages are paid. BRAVO! BP seems to be doing a yeoman like job trying to stop the spill, but as I noted above, they seem totally deaf, dumb, and blind when it comes to mitigating the damages by containing the oil. I would not be surprised to see BP seek Chapter 11 bankruptcy protection.

In that vein, I have it on good authority that the well could be stopped by implosion, by shoving a (non-nuclear) charge deep into the pipe and blasting it closed. Why hasn’t BP done so? Probably because they still intend to make money off the well once they get it under control (and the moratorium ends).

Another bright spot: crawfish grow inland in fresh water ponds.

By W. Reed Smith