The Canadian subsidiary of an American petroleum giant is preparing to drill one of the deepest offshore oil wells in the world off the coast of Newfoundland - amid fears there are not enough safeguards to stop a mass spill like the one in the Gulf of Mexico.
Chevron Canada is deploying a rig 400 kilometres northeast of St. John's to drill 2,600 metres below the ocean surface in search of crude. The well, located in an area known as the Orphan Basin, would be almost a kilometre deeper than the one that has ruptured off the southern U.S. coast.
The project comes as the Canadian government is talking tough about maintaining strict safety regulations on future offshore drilling in the Arctic. However, questions are arising over whether Ottawa is taking a strong enough stand on existing projects, particularly those on the East Coast.
Like the Deepwater Horizon project in the Gulf of Mexico, which has been spewing thousands of barrels of oil a day since it ruptured April 20, the new well off the coast of Newfoundland is part of a new class of ultradeep projects that present difficult challenges in the event of a disaster.
For the past few weeks, crews have been rushing to drill a relief well at the site of the Gulf of Mexico spill to stem the flow of oil. Such emergency backup wells are used to reduce pressure in the main well so it can be capped.
However, if Chevron's Lona O-55 well off Newfoundland were to rupture, industry observers argue the equipment needed to drill a relief well would not be available fast enough. It could take weeks to get rigs in place.
Only two rigs located off the east coast of Canada could be moved into position fast enough to complete an emergency relief well, and neither of them go deep enough, oil industry expert Ian Doig said Wednesday. One can operate in 1,525 metres of water; the other can handle less than half that depth. A deepwater rig would have to be brought in from elsewhere in the world.
"If Chevron gets into problems at the total depth of its proposed well, neither of those two rigs in the area have the capability of going down to that depth," said Mr. Doig, an energy analyst in Calgary. "They'll just have to stand back and watch."
Facing questions over whether a Gulf of Mexico spill could happen in Canadian waters, Newfoundland Premier Danny Williams told the province's House of Assembly that he wants an independent analysis of whether Newfoundland is prepared for a major oil spill.
However, a spokesman for the regulator that oversees drilling off the East Coast said the Newfoundland and Labrador Offshore Petroleum Board has been assured Chevron has an emergency plan in place.
"I don't think there has been any discussion around suspending this [Chevron]well because of anything happening in Louisiana," said Sean Kelly, a spokesman for the regulator. "Because we don't know what happened [to cause the Gulf spill] So we don't know what the implications are for the Newfoundland offshore."
When Chevron applied for a licence to drill Lona 0-55, the company had to demonstrate to the regulator how it would drill a relief well, among other things. "That's one of the things that they would do, but there are other precautions before they get to that," Mr. Kelly said.
Details of what measures would be employed are not clear. The regulator does not know how fast a relief well could be drilled. A spokesman for Chevron Canada would not comment and directed questions to the regulator.
Ian Jones, a biology professor with the Institute of Biodiversity, Ecosystem Science and Sustainability at Memorial University in Newfoundland who studies offshore drilling, said there is cause for concern. Oil companies install blowout technology to stop a well from gushing, but in the case of the Gulf of Mexico disaster, that equipment failed.
"The question now is: Is the [offshore Newfoundland]exploration, in 2.6 kilometres of water, the same kind of reckless behaviour we saw off Louisiana with the Deepwater Horizon?" Mr. Jones said.
The risks of an accident so deep below the surface are the same as those in shallower water, but repairing leaks is far more problematic. The damaged area cannot be readily seen or manipulated, there are few replacement parts that are rated for extreme depths, and the difficulties associated with drilling a relief well to alleviate the pressure and stop the oil from gushing multiply exponentially.
Mr. Williams has tried to calm fears over a potential spill by suggesting the colder water and thicker crude in the Orphan Basin would mean the oil would sink to the bottom instead of washing toward the coast.
Mr. Doig questions the science behind that argument. "That doesn't give me a good feeling. Here they are supposedly sitting on one of the richest fishing grounds in the world."
Though U.S. President Barack Obama has put a moratorium on future drilling in the Gulf until an investigation into the spill determines what went wrong, and Governor Arnold Schwarzenegger has done the same off the coast of California, the Canadian regulator said it is not changing any plans for the East Coast.
The Newfoundland and Labrador Offshore Petroleum Board performs the same functions for the coast of Newfoundland that the National Energy Board performs in the Arctic. The NEB is in the middle of a policy review that will determine whether relief wells must be drilled in the Arctic at the same time the main well is constructed, so there is an immediate contingency in the event of a rupture.
The Lona O-55 project involves several oil companies. Chevron Canada is the main investor with 50 per cent, while Shell Canada holds 20 per cent. Imperial Oil Resources Ventures and Exxon Mobil Canada each own 15 per cent.