Montara oil spill report will provide clues for handling BP inquiry

The Montara oil spill in the Timor Sea that lasted for three months in late 2009 was large but affected no countries directly and is certainly a long way from the Gulf of Mexico and BP.  However there are enough similarities for considerable media attention to be focused on the investigative report into the incident that was handed to the Australian Government on 17 June 2010.

The Australian Resources Minister, Martin Ferguson, acknowledged the receipt of the commission of inquiry’s final report but will not be releasing it yet.

Greens Senator Rachel Seiwert has said:

“The release of all information available to date is essential for the development of new regulatory and environmental procedures….  We need to be better prepared to respond to future disasters in our precious marine environment.”

Seiwert has at least acknowledged the global context of the report:

“Halliburton is reported to have carried out cementing work on both the Montara well and the US Deepwater Horizon well in the Gulf of Mexico. The failure of this cementing has been linked in the media to both spills.”

Speculation is that the report will recommend a “single national regulator for off-shore drilling” according to the Australian Financial Review (AFR) on 19 June 2010 (p5. not available online).  This is another major issue where the Western Australian government will be in conflict with the federal government not be happy but then, Resources Minister Ferguson has spoken against this option in the past.

The AFR quotes the COO of Roc Oil, Alan Linn:

“It was always our feeling that [Montara] would be a game-changer for the Australian industry….The Deepwater Horizon on top of that will fundamentally change the way the industry is regulated.  It has to.”

In a similar situation to President Obama, government are deciding that the industry must be better regulated but not to the extent that investment is less attractive.  The US is dealing with a British company, Australia is dealing with a Thai company, both have drilling options elsewhere.  The political challenges should not be underestimated but all this does is call on leadership but a new leadership that may be willing to risk a hit on the corporations’ share price or a reduction in tax revenue.

Kevin Jones

7 thoughts on “Montara oil spill report will provide clues for handling BP inquiry”

  1. A good article Kevin, thanks. It\’s indeed a shame that Australia was not so outraged by the Montara spill. It may not have been so visible on the shores but the polluting effect to marine life and our ocean was shocking. This now, the Gulf and BP, surely is the wake up call to all people (and governments) that we must and can turn to alternatives sooner. The environmental cost as well as monetary cost for clean up I hope will soon outstrip the cost of real change. Maybe only then will we learn.
    The WTC Foundation has every right to feel wronged. And our own Mr Rudd approved dozens of new exploration leases for offshore drilling with what seems no regulatory changes.
    And as for Halliburton their track record speaks for itself.

  2. Hi, nice piece. The companies like BP should be penalized heavily. It should give a clear message to all other companies that if you mess up with environment you are going to face such heavy penalties.
    I am very sad about people in India, Bhopal victims. They died of methyl isocyanate 25 years ago and are still fighting for justice. Mr. Sanjay Puri has written good and short article about Bhopal tragedy and BP\’s tragedy and has compared these two mishaps.

    Ashish

  3. It is not right that Montara Oil Spill Disaster is not damaging any countries. May has no impact at all to Australia,because nearly 80% of the oil spill polluted Indonesian waters. Please be fair, we are not third class people

    1. The Montara oil spill has had an economc impact on the countries in region but the slick, to my knowledge, did not reach land and therefore the impact is not comparable to the communities on the Gulf of Mexico. If the Montara impact was different to my understanding please let me know.

      I note the concerns of the West Timor Care Foundation as expressed in this September 2009 article

      The economic significance of the Timor sea oil fields to Timor is an issue that has been sadly neglected by Australians and the Ausrtralian Government. I believe that the agreement between Timor and Australia on the oil reserves was unfairly skewed to Australia\’s benefit, particularly when one of the world\’s newest nations needed the economic stability that the oil fields could have provided. Neocolonialism is not dead.

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