Shell: If necessary, we have the ability to call on equipment from Singapore

CONCERNED that a disaster similar to the Gulf of Mexico oil spill could hit the Philippines, government and private sector executives have begun the process of tightening safety and contingency measures in the petroleum industry. Ramon Oca, Energy secretary, said in a recent forum organized for this purpose that the Deepwater Horizon oil spill highlighted the need to make sure that necessary preparedness and response measures are put in place by companies doing oil and gas exploration and development work in the country.

“We want to make sure that we are ready and prepared to respond to an emergency like this and more importantly to prevent an incident like the one in the Gulf of Mexico,” he said.

To strengthen Philippine safety and response capability, the Energy department and oil companies agreed to study existing safety policies on oil and gas exploration to see if there is a need for revisions.

“Policy recommendations are already in place. What we will do is revisit them if there is a need to amend, update or upgrade these policies and recommendations,” Oca said.

Government agencies require oil companies to implement stringent standards in the setup and implementation of health, safety and environmental plans. They are also required to submit an emergency-response plan and an oil spill-contingency plan before their work programs are approved.

In the event of an oil spill, petroleum companies are required to shoulder the clean up operations and costs that would arise from any ensuing environmental and livelihood damages.

As an added contingency measure, Edgar Chua, Pilipinas Shell Petroleum Corp. country chairman, told reporters that oil firms have agreed to cooperate on common programs and facilities in case there are oil spills.

“In case yung facilities natin, yung equipment natin locally cannot meet yung requirement natin, we have the ability to call on equipment coming form Singapore which will be flown in. [In case our facilities, our equipment locally available cannot meet our requirements, we have the ability to call in equipment coming from Singapore.].” he said.

Before the previous administration bowed out, Acting Energy Secretary Jose Ibazeta announced that he was convening stakeholders in the oil exploration industry to draft guidelines to prevent oil spills and respond effectively to disaster.

The Gulf of Mexico oil spill came at a time when the local upstream petroleum industry is slowly gaining a headway with the entry of a number of big ticket firms.

Last year, Exxon Mobil Corp. started its drilling operations in the South Sulu Sea. The initial well drilled by the Texas-based oil giant proved to be a success after it found traces of hydrocarbons—the building blocks of oil and gas. This prompted the company to conduct additional drillings to better assess the reserves, if any, in the area.

Exxon’s partners in the project are the world’s largest miner BHP Billiton Ltd. and Malaysian firm Mitra Energy Ltd.

Also, the local unit of Royal Dutch Shell Plc. has started drilling for additional wells at the Malampaya field, the country’s largest natural gas producer.

Australian firm Nido Petroleum Ltd. has started to develop the Tindalo oil field in offshore Palawan.

In addition to these companies there are many other oil and gas exploration and development firms that have committed to drill petroleum wells in the country this year.

The government is banking on these investors to increase local oil production, which now accounts for roughly less than 15 percent of demand.

But while it is up to the Department of Energy to drum up interest in the industry, the Philippine Coast Guard (PCG) is the lead government institution in dealing with oil-spill contingencies.

Capt. Lyndon Latorre, PCG deputy chief for marine environmental protection, said that under present rules, oil firms are responsible for clean ups when spillage is between 1,000 and 10,000 barrels of oil, which is categorized as a “Tier 1” contingency.

At Tier 2 (10,000 to one million barrels), oil firms and government agencies jointly respond to the oil spill. Tier 3 (above one million barrels), on the other hand, would require the help of other countries.

Because of the significant role the PCG would play in an oil spill, the Energy department and oil companies have offered to support the agency through emergency response training courses.

But Oca said that this might not be enough in case oil spills reach mammoth proportions like that in the Gulf of Mexico, which is spewing 35,000 to 60,000 barrels of oil a day.

Chevron cleans up spill

Amusingly, an oil spill in Bacolod City was reported to have been most successfully controlled and cleaned up.

The Philippine Coast Guard reported the success of Chevron Philippines Inc. in dealing with a “product spill” that happened last week off the company’s former terminal facility in Bacolod, Negros Occidental.

The report was issued after a surface surveillance and reconnaissance conducted by the Coast Guard off the area surrounding the spill site.

At the same time, the Coast Guard gave the go-signal to Chevron to proceed with its plugging operations to permanently cap a cut fuel pipeline that was identified as the source of the leak.

Chevron reported the successful clean-up of the product spill, estimated at less than 100 liters, in a containment area measuring some 50 to 80 square meters.

The clean up involved the use of dispersants on the spill, which was characterized as a thin film or sheen covering the affected area.

A Coast Guard dive team led by Lt. Cmdr. Godofredo Vagilidad also confirmed the successful plugging of the source of the leak—a 20-meter stretch of the old bunker fuel-receiving pipeline.

“Chevron in coordination with the [PCG] will continue monitoring the area to ensure that no further leakage of product happens while the permanent capping process is being done,” Chevron said in a statement.

A complaint was filed with the Bacolod City Police Office regarding the theft of pipeline by pilferers, which caused the leakage of residue product into the waters.

“We will leave that part of the incident in the hands of the proper authorities such as the police and local government authorities. We continue to conduct our activities in the area in a safe and reliable manner in coordination with local government officials and the Coast Guard and thank them for their support and assistance,” Chevron said.

The old Bacolod Terminal facility is due for dismantling this year. –EUAN PAOLO C. AÑONUEVO REPORTER, Manila Times