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Oil Explorer: We’Ve Got Tourism, Fishing Covered

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Bahamas-based oil explorer yesterday reassured that the insurance coverage for its first well will cover any tourism or fisheries losses “in the highly unlikely event” of any spill or environmental impact.

Roberta Quant, Bahamas Petroleum Company’s (BPC) environmental scientist, told Tribune Business it had obtained protection “considerably in excess of the minimum levels of cover required by The government” for the Perseverance One well that will be drilled in waters some 91 miles to the west of Andros near the maritime boundary with Cuba.

In written replies to this newspaper’s questions, Ms Quant said the well’s location was not in a Marine Protected Area (MPA) as suggested by environmental activists, adding that its location was some 85 miles from Cay Sal and had been subjected to intense scrutiny that showed “there are no sensitive environmental receptors anywhere near the drill site”.;

A 17-year environmental industry veteran, with a master’s degree in the sector’s engineering discipline, Ms Quant said the risk of any oil spill from BPC’s first well was “minimal” - especially given that it is an exploratory well design to detect whether commercial quantities of oil exist beneath the Bahamian seabed, rather than one that will be used for full-scale commercial production.

She added that efforts by some activists to compare BPC’s activities to the Deepwater Horizon disaster, which occurred in the Gulf of Mexico more than ten years ago, were “technically and geologically inaccurate”.

This, Ms Quant argued, was because the rock structures and pressures on the Bahamian seabed are much less than those in the Gulf of Mexico, meaning that the “risk of a spontaneous flow of oil, or a spill, is dramatically reduced” where BPC is concerned.

However, taking no chances, the oil explorer said all necessary insurance covers for Perseverance One have been secured through the broker, Aon UK, with insurers from Lloyd’s of London and other international markets underwriting it.

“This policy provides cover for the costs of halting and remediating any incident during drilling, including the costs of redrill, the costs of drilling a relief well, and the costs of any remedial or clean-up operations,” Ms Quant told this newspaper.

“The insurance policy also provides third-party liability cover losses that might be suffered in the highly unlikely event of such an incident – for example, losses that a fisherman or hotel might suffer - although, as mentioned, this is considered to be an extremely remote and highly unlikely possibility.

“The level of insurance cover obtained is considerably in excess of the minimum levels of cover required by the Government, as well as commensurate with or in excess of cover in place for similar wells being drilled in other locations in the world,” she continued.

“It is also worth noting that the insurance companies – who will be financially exposed to the costs of responding to any incidents – required BPC’s drilling plan, Environmental Impact Assessment, Environmental Authorisation and Environmental Management Plan to be submitted to a third-party technical review.

“This review assessed all BPC plans, policies and procedures to be of global standard, with risks appropriately identified and planned for, such that the project was able to secure insurances as required. Furthermore, all of our main well contractors, being Stena, Halliburton and Schlumberger, again global names and industry leaders, have extensive insurance policies of their own in place.”

Paul Mailis, director of the National Fisheries Association of The Bahamas, had last week voiced concerns that the well BPC is aiming to spud before Christmas 2020 could threaten the investment made by fishermen in “tens of thousands” of lobster condos and traps laid in the Great Bahama Bank area if there was a spill or any incident.

However, Ms Quant asserted that the well is not located in a Marine Protected Area (MPA) and lies 85 miles away from Cay Sal. She said consultations with fishing communities had for the first time resulted in the production of maps documenting fisheries habitats and environmental zones across The Bahamas.

“Through the co-ordination of the Bahamas Commercial Fishers Alliance, and with active assistance from fisherman from multiple locations, BPC held detailed consultation meetings with many fishing communities. Amongst fishing communities visited were Long Island (north, central and south), Eleuthera (Spanish Wells), Andros, Abaco (Fox Town, Marsh Harbour and Sandy Point), to name a few,” she said.

“An important outcome of these consultations was the creation by BPC of incredibly detailed environmental sensitivity maps, which for the first time ever comprehensively mapped and documented critical habitats and environmental zones across The Bahamas.

“With the collaboration of local communities, these critical maps highlight, define and prioritise all habitats so that all concerned can be fully aware of how best to safeguard and protect key and sensitive areas of the environment.”

Reiterating that the prospects of any oil spill from BPC’s first exploratory well “have to be considered extremely minimal”, Ms Quant urged: “Fear-based sensationalism should not replace facts and science.”

Ms Quant said sea conditions, weather and the Great Bahama Bank would keep all activity at BPC’s drill site “remote from tourism and fishery activities”, with the well already located in a deep-water channel that is a major shipping lane crossed by oil tankers every day.

“Whilst naysayers like to focus on the extremely rare cases of incidents, all over the world literally thousands of offshore wells have been drilled safely in locations characterised by higher pressures, temperatures and at greater depths than the Perseverance One well,” she added.

“For example, approximately 10,000 wells have thus far been drilled in the Gulf of Mexico - and with nearly twice as many onshore - and over 3,000 production platforms are currently operating in the Gulf of Mexico.

“Indeed, in the last ten years the US government (under various administrations) has sanctioned many hundreds of wells to be drilled in the US Gulf of Mexico, notwithstanding the impact of the previous incident, which have been drilled safely.”

Pointing to facilities such as Buckeye Bahamas (the former BORCO) and South Riding Point in Grand Bahama, as well as this nation’s present demand for fossil fuels, Ms Quant said: “From my work over the past decade, and through my interactions across the broader communities in The Bahamas, I have observed that many people don’t realise that The Bahamas is already well and truly in the oil game.

“We have oil tankers passing through The Bahamas archipelago daily, whether to transport bunker C fuel or diesel to generate power, or transporting oil to one of the world’s largest oil berthing facilities and storage tanks facilities in Freeport, Grand Bahama.

“We apparently live comfortably with these risks everyday – as we do in our personal lives with driving cars, flying in planes, and even crossing the roads – but perceive exploratory drilling, although very remote and temporary, in a very different way as if somehow more hazardous,” she added.

“We in The Bahamas are surrounded by other countries, such as Cuba and the United States in the Gulf of Mexico, who all engage in substantial exploration and oil production activities. If anything happens in one of these countries, it will affect us in The Bahamas just as much.

“So really, what this all means is that we in The Bahamas are already exposed to all of the risks of an international oil industry, but without seeing any of the potential benefits from that industry flow to the people of The Bahamas.”

Comments

tribanon 6 months, 1 week ago

Despite all of the big name dropping, the adequacy of the insurance coverage BPC is talking about here really isn't worth the paper it's written on, and our government officials are either too damn stupid or corrupt to know it. As a two-bit, pink-sheet listed (penny-stock) company, BPC does not have anywhere near the financial wherewithal to afford the type of insurance coverage that is warranted in the circumstances.

And someone needs to tell BPC's lackey (Ms. Quant) that most environmentally conscious Bahamians think of the entire sea area of The Bahamas as a Marine Protected Area and not just our National Sea Parks entrusted to the care of The Bahamas National Trust.

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Proguing 6 months, 1 week ago

Exactly, BP spent over $60 billion in court fees, penalties, and clean-up costs. A penny stock can't take insurance for that amount of money, although I am certain that the executives have all the insurance necessary to protect themselves.

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themessenger 6 months, 1 week ago

I'm sure beyond the shadow of a doubt that the thousands of fish, conchs, crawfish, and other diverse marine life that will be killed off as a result of even a small spill will take comfort in knowing that "all necessary insurance covers for Perseverance One have been secured through the broker, Aon UK, with insurers from Lloyd’s of London and other international markets underwriting it."

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tribanon 6 months, 1 week ago

No Bahamian in their right mind should vote for Pintard or Ferreira in the next general election. They're both breast beating lime light loving hot air blowers with no substance or back-bone whatsoever.

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Proguing 6 months, 1 week ago

"We apparently live comfortably with these risks everyday". No, we are not comfortable with these risks and that is the reason the world is moving away from fossil fuel. Have you heard of renewable energy or electric vehicles?

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ColumbusPillow 6 months, 1 week ago

Regarding reliability and economy, wind and solar power are uncompetitive to the use of fossil fuels or nuclear power. Almost all electrical power is generated by burning fossil fuels.....electric vehicles get there power from burning fossil fuels. No country on this planet can survive unless it has access to cheap energy

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Porcupine 6 months, 1 week ago

Hi Columbus oil pillow. Stop talking crap.

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rosiepi 6 months, 1 week ago

The analogies of risk Ms Quant presents ,a car accident, or even God forbid a commercial airline crash are not equivalent examples of the adverse consequences to most every Bahamian industry from an oil spill disaster. And though BPC could theoretically cause an oil spill of the same magnitude as other infamous disasters, their pockets are notoriously shallow to expect ample compensation.

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TalRussell 6 months, 1 week ago

If for a mere second believe single word assurance there is a nice hotel resort property for sale situated on the out island of FREE port.

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Porcupine 6 months, 1 week ago

"It is difficult to get someone to understand something, when their salary depends upon them not understanding it." Hello Ms. Quant.

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Bahama7 4 months, 3 weeks ago

The facts will be lost on the environmentalists who haven’t mastered the art of LISTENING.

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