When a fire on the West Atlas rig off the coast of Darwin, Australia, was extinguished, the National Offshore Petroleum Safety Authority (NOPSA) could congratulate itself on a job well done. Thanks to the prohibition notices it served on the rig’s operator, PTTEP Australasia, no one was onboard when it caught fire and tragedy was prevented.

Environmental campaigners have, however, accused the Australian offshore industry of shoddy standards. At least 400 barrels of oil per day were allowed to pour out of West Atlas into the Timor Sea in the ten weeks prior to the fire. With an inquiry into the rig and the immediate response to the leak yet to be concluded, we ask whether the handling of the West Atlas rig was a success or a failure.

Start of the spill

Problems on the West Atlas rig began in the early hours of 21 August, when light crude oil and natural gas began leaking into the sea. In accordance with safety procedures the 69 workers onboard were evacuated, with two small planes and a specialist C-130 Hercules scrambled to spray chemical dispersant over the area.

Global Insight’s Asia Pacific energy analyst Tom Grieder says initial response to the leak was positive from a safety point of view. “The crew members were all evacuated safely, an air exclusion zone was set up around the rig as a precautionary measure and ships were advised to sail no nearer than 20 nautical miles,” Grieder says.

“Environmental campaigners have accused the offshore industry of shoddy standards.”

But in his opinion the response was less impressive from an environmental perspective. “It took three days for the Australian Marine Safety Authority (AMSA) to start spraying dispersant chemicals on the slick, which by that point was already estimated to be about 14km long and 30m wide.

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“That said, monitoring of the slick and what it was doing was carried out right from the start, which is important for assessing the damage to the environment and ensuring that PTTEP pays the right amount for clean-up,” Grieder says.

Plugging the leak

In order to plug the leak PTTEP deployed a second rig to pump mud into the well of West Atlas and stop the flow of oil and gas into the sea. The only trouble was their chosen rig, West Triton, was moored off the coast of Indonesia. As such it took five weeks to tow by boat to West Atlas.

“The remote location of the well meant it took time to get a rig out from Batam island in Indonesia to the site,” says Grieder. “This was compounded by a snapped tow line and a loss of power on a tow ship, which was supposed to escort the West Triton rig.” This further delayed the operation by several days.

Once West Triton was in place PTTEP set about trying to drill through rock 2.6km below sea level and pump mud into a 25cm-diameter pipe. It was a difficult operation and no eyebrows were raised when their first attempt failed. When a second and third attempt pulled up short, however, PTTEP was so worried it called a crisis meeting with competitors and an oil well fire fighting team from Texas, US, to discuss how to fix the leak.

“PTTEP had little idea of the exact location of the leak, which is why it took so many attempts to stop the flow,” says Grieder. “Attempts to drill a sidetrack well also reportedly encountered very deep rock formations, which slowed drilling progress to intercept the well. The operation was also quite dangerous. The relief well had to be drilled from the West Triton rig because the West Atlas rig was not safe to board.”

Try and try again

“PTTEP claims the disaster has cost it A$170m in lost revenue and disaster-fighting expenditure.”

A fourth attempt to plug the leak came and went without success but the fifth, on 1 November, was successful. Any celebrations were short-lived, however, because within hours the rig was engulfed in flames.

The fire was eventually put out but its effects will last longer than the burned-out West Atlas shell that stands in the Timor Sea. PTTEP claims the disaster has cost it A$170m in lost revenue and disaster-fighting expenditure. In addition, it expects the clean-up bill to be over A$5m.

Meanwhile the environmental cost of the disaster is harder to estimate. There have been no official figures yet on wildlife deaths but the Australian Marine Conservation Society estimates that the slick covers 15,000 square kilometres of ocean. The WWF says about 30,000 sea snakes may live in the area.

Australian Marine Conservation Society director Darren Kindleysides says plugging the leak is not the end of the environmental impact of the spill. “Thousands of tons of oil have polluted the Timor Sea, leaving a toxic legacy that will continue to harm the region’s wildlife for years to come.”

Finding conclusions

While the carcass of the West Atlas was still smouldering, the Australian Government announced it would be launching a full inquiry into what is considered one of the country’s worst-ever environmental disasters.

The true merits of the way the leak and fire were handled may not become clear until the inquiry reports back in 2010, but certain conclusions are easy to draw already.

“The Australian Marine Conservation Society has estimated that the slick covers 15,000 square kilometres.”

“The West Atlas leak will go down as a public relations disaster in the oil industry in the region,” says Grieder. “Allegations that PTTEP had been downplaying the scale of the leak have led to criticism from environmentalists and the government.” It is clear the event is going to lead to a significant increase in expenses for PTTEP, which has promised to pay for cleaning up the damage and could face further fines.

“Along with identifying the cause of the incident and the adequacy of the response, the inquiry is also likely to focus on the regulatory regime for tackling such environmental disasters, which could lead to more stringent environmental regulations,” Grieder says.

It is not, however, likely to lead to a slowdown in investment in the industry as the resource potential of Australia and the profits to be made from developing oil and gas deposits are too great.