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The gulf oil spill is now headed into its eighth week. Many have commented on the inaccuracies and weaknesses of the BP Oil Spill Response Plan, but few have analyzed it for what needs to be done to ensure the same results do not happen again. The plan is inadequate as it exists. BP’s Plan and all other plans like it need to be changed, and the state and federal agencies need to take this opportunity to collect additional information on performance of spill personnel and equipment to assist in the analysis of what is necessary to make future plans more effective.
The BP Oil Spill Response Plan is primarily an outline of the Incident Command structure, the responsibilities of the different members of the Incident Command Team, a listing of State and Federal Agencies that may need to be contacted in the event of a spill, incident forms, flow charts, decision diagrams, response organizations and equipment lists. It sounds like and is more of a resource manual that a response plan. It provides little assistance to the Incident Commander in determining what to expect for response times and effectiveness for deployed equipment or reaction of the oil to the environment.
The models upon which the spill plan is based were so inaccurate that they provided the Incident Commander with little or no understanding of when and where to expect the oil. They were woefully inadequate in assisting the Incident Commander in understanding the volume of the spill, the trajectory of where to look for the spill or the speed of the spill through the environment.
The models should be redesigned to provide more accurate projections now that there is actual data to compare. If the models are inconsistent with what happened, the models are wrong and they need to be changed to reflect reality. Even if the models are changed, they will still be wrong the next time, but they may not so grossly underestimate the speed and trajectory of the oil as to be useless to the Incident Command Team.
Only three pages of the 582 page spill plan are dedicated to a written analysis of the worst case scenario and much of that is merely an explanation of the scenario and a listing of the different response methods and their capacities to recover oil. An Incident Commander would find no assistance in this section of the plan on how to respond to the spill or what to expect from a spill of this magnitude.
There is little anywhere in the spill plan in the way of analysis to assist the Incident Commander in understanding what to expect from the response options he is provided. Equipment lists have nameplate capacities but no analysis of their effectiveness in the environment. Skimmers with nameplate capacities totaling 491,721 barrels per day are identified in the plan and give a false sense that they should be able to easily capture a spill of 250,000 barrels and remove it from the environment. But oil does not collect in one place waiting to be picked up, and nameplate capacities are not the same as effective rates.
Spill plan worst case scenarios should have estimations of how much oil is expected to escape into the environment; estimations of daily rates and how long will it take to contain and stop the spill from continuing; estimations of how much is being dispersed into the water column and how much is suspended in plumes in the water column. Of the oil collecting on the surface, the Incident Commander should have an understanding of how much will probably aggregate in sufficient quantities to be retrieved by mechanical skimmers and what percentage can be attacked with dispersants or burned? The Incident Commander should understand what percentage is escaping, the quantity of oil, the quality of the oil and when and where to expect the oil onshore.
BP needs to collect information regarding effective rates for deployment of its spill response equipment. For each piece of equipment deployed the following information should be collected:
1) the time required for equipment to be deployed onsite should be recorded, from the time it was requested to the time it was deployed onsite;
2) data should be collected regarding standby time for each piece of equipment, transportation time to get equipment to a new location for deployment, and time deployed in response to the spill;
3) during the time deployed the volume of liquid retrieved should be recorded, and data regarding the oil/water ratio should also be captured.
If this information is captured and analyzed it would provide the data necessary to calculate an effective response rate for each piece of equipment deployed. Effective response rates provide the Incident Commander with a more accurate tool than nameplate capacities in planning a response to a major oil spill.
Once the information has been collected from the spill it should be analyzed with the response team, state and federal agencies, and other stakeholders to determine the requirements for future offshore exploration and operations spill plans.
In addition, a plan that is only required to be updated once every two years is going to have a certain number of errors. I recommend annual updates and a certification by the person signing the plan as to the accuracy of the plan. That would require someone in the organization to attempt to verify all the numbers in the plan at least once a year.
Half of BP’s Incident Command Organization Chart did not have individuals identified to fill the incident command positions. I recommend that all leadership positions in the Incident Command structure should be identified in the organization chart and those individuals should be required to participate in a response drill at least annually.
If the above recommendations are followed, they won’t prevent incidents from occurring, but incident responders will have more effective tools to assist them in their response and they will be more prepared to respond to the incident.
Steve Porter is a former exploration permitting manager for a major oil company and was responsible for the preparation and approval of offshore oil spill response plans.
Monday, June 14, 2010
Thursday, May 27, 2010
Evaluation of Exploration in the Arctic OCS
The BP oil spill in the Gulf of Mexico has affected and will continue to affect the environment and the lives of many in the southern coastal states for years to come. For Alaskans the spill brought back memories of Exxon Valdez oil spill in 1989 and the impact it had on their lives.
Today the BP oil spill has resulted in a more direct impact on Alaska and the future of oil and gas exploration in the State. Today President Obama announced the suspension of Shell’s offshore arctic exploration operation plans. There is substantial uncertainty regarding when and if the Administration will allow exploration in the Arctic OCS to continue.
The purpose of this article is to outline the issues that the Administration needs to address before they decide to allow or disallow exploration in the offshore Arctic.
In the weeks following the Exxon Valdez oil spill, as the exploration permitting director for a major oil company, I submitted my first offshore oil spill contingency plan. The issues we were required to address then are the same issues that should be addressed now as the Obama administration evaluates whether or not to make the suspension of offshore exploration drilling long term or permanent.
There are four areas that should be examined during the review: 1) formation pressures and risk, 2) safety and prevention, 3) spill plan preparedness, and 4) effectiveness of equipment and personnel.
First, formation pressures and the potential risk of blowout
The risk of encountering high pressure pockets of gas or oil should be understood and planned for in the drilling and well casing program. Several wells in the Arctic have lost well control due to encountering high pressure gas pockets that were not managed properly in the drilling program. Luckily none involved loss of well control in an oil producing zone. Even though there have been several loss of well control events, statistically the industry has done a good job understanding and preparing for this type of event.
Second, safety and prevention
In the event of the loss of well control, the operator should be able to utilize the safety mechanisms in place on the rig to stop the flow of oil or gas to the surface. The most well know mechanism, especially after the BP blowout, is the blowout preventer. Functioning properly, it should be able to seal off the well and allow the operator to develop a plan to regain control of the well without release of hydrocarbons into the environment. These safety mechanisms are tested regularly and almost always work. But there are now at least two well known events where they didn’t work: the IXTOC in Mexican waters, and now the BP blowout in the Gulf of Mexico OCS.
Third, spill plan preparedness
Shell has committed a substantial amount of equipment to meet the Alaska Department of Environmental Conservation’s Response Planning Standard and to meet the Minerals Management Service requirements. On paper Shell could handle a well blowout that discharged up to 5,500 barrels of oil into the environment for up to 34 days which is the number of days Shell projects it will take to drill a relief well and stop the blowout. On paper it looks like Shell has met the spill plan preparedness standard.
Fourth, effectiveness of equipment and personnel
The Oil Discharge Prevention and Contingency Plan (ODPCP) contains lists of equipment and nameplate capacities but very little analysis in the way of the effectiveness of that equipment in the environment the equipment will probably encounter.
Generally industry spill plans and presentations regarding preparedness make it look like they are prepared and could clean up oil in any environment they encountered in their operations. Pictures of spill response vessels and spill equipment in the Arctic environment give the audience the feeling that the equipment pictured will be onsite and ready to perform the function to the effectiveness that is listed on its nameplate.
The problem is that nameplate capabilities don’t work in the Arctic. Skimmers that performed poorly in the Gulf of Mexico will perform even worse in the Arctic, even if they are “winterized” for Arctic conditions. Sea ice conditions in the Arctic may prevent spill response vessels and equipment from getting close enough to the oil to deploy the equipment. Oil may be entrained in the ice and under the ice where spill response equipment will not be effective. Oil may not collect in sufficient quantities or may be weathered to such an extent that in situ burning is not an available option.
There is documentation of the amount of equipment available to respond to a spill and the potential response times, but there is little analysis of the effectiveness of that equipment in various arctic conditions. The State of Alaska and the MMS need to understand how much oil can be expected to be picked up under different scenarios and what the impact is on the environment from the remaining oil that is not recaptured.
How effective is the use of dispersants in broken ice conditions? What is the impact on wildlife in the water column and on the ice? Some of the dispersant will get on the ice. What if it is injested by wildlife? What would seem unusual for people is not always unusual or uncommon for animals. There is at least one incident on the north slope where a polar bear injested industrial liquids resulting in the death of the polar bear.
Exploration drilling activities are planned to begin on or about July 4th and drilling in hydrocarbon bearing zones would end on or before October 31st, depending on ice and weather. What if a blowout occurred late in the drilling season, or what if sea ice prevented the drillship from getting back on location? There may not be sufficient time to drill a relief well during that drilling season and the drillship may have to return the next summer drilling season to complete the relief well. If the existing drillship burns up in the ensuing fire, the relief rig will not be available to drill a relief well until the next drilling season. What is the impact on the environment from an uncontrolled well blowout that continues to release oil in the environment for 6 months or longer?
Shell’s exploration plan states that “A very large spill from a well-control incident is not a reasonably foreseeable event in connection with the OCS exploration activities set forth in Shell’s EP, and therefore, this EA does not analyze the impacts of such a worst-case scenario.” Lets hope they are right.
You don’t plan for meteors hitting the earth, but you do plan for earthquakes. The likelihood of a catastrophic oil spill in the arctic is somewhere in between the two.
If the state and federal government approve Shell moving forward in the Alaska OCS, they need to understand that a major oil spill from a blowout will not be easier to stop or clean up in the arctic than it was in the Gulf of Mexico. It will be more difficult. The best we can hope for is good management practices and the statistical likelihood that the incident will not occur.
Today the BP oil spill has resulted in a more direct impact on Alaska and the future of oil and gas exploration in the State. Today President Obama announced the suspension of Shell’s offshore arctic exploration operation plans. There is substantial uncertainty regarding when and if the Administration will allow exploration in the Arctic OCS to continue.
The purpose of this article is to outline the issues that the Administration needs to address before they decide to allow or disallow exploration in the offshore Arctic.
In the weeks following the Exxon Valdez oil spill, as the exploration permitting director for a major oil company, I submitted my first offshore oil spill contingency plan. The issues we were required to address then are the same issues that should be addressed now as the Obama administration evaluates whether or not to make the suspension of offshore exploration drilling long term or permanent.
There are four areas that should be examined during the review: 1) formation pressures and risk, 2) safety and prevention, 3) spill plan preparedness, and 4) effectiveness of equipment and personnel.
First, formation pressures and the potential risk of blowout
The risk of encountering high pressure pockets of gas or oil should be understood and planned for in the drilling and well casing program. Several wells in the Arctic have lost well control due to encountering high pressure gas pockets that were not managed properly in the drilling program. Luckily none involved loss of well control in an oil producing zone. Even though there have been several loss of well control events, statistically the industry has done a good job understanding and preparing for this type of event.
Second, safety and prevention
In the event of the loss of well control, the operator should be able to utilize the safety mechanisms in place on the rig to stop the flow of oil or gas to the surface. The most well know mechanism, especially after the BP blowout, is the blowout preventer. Functioning properly, it should be able to seal off the well and allow the operator to develop a plan to regain control of the well without release of hydrocarbons into the environment. These safety mechanisms are tested regularly and almost always work. But there are now at least two well known events where they didn’t work: the IXTOC in Mexican waters, and now the BP blowout in the Gulf of Mexico OCS.
Third, spill plan preparedness
Shell has committed a substantial amount of equipment to meet the Alaska Department of Environmental Conservation’s Response Planning Standard and to meet the Minerals Management Service requirements. On paper Shell could handle a well blowout that discharged up to 5,500 barrels of oil into the environment for up to 34 days which is the number of days Shell projects it will take to drill a relief well and stop the blowout. On paper it looks like Shell has met the spill plan preparedness standard.
Fourth, effectiveness of equipment and personnel
The Oil Discharge Prevention and Contingency Plan (ODPCP) contains lists of equipment and nameplate capacities but very little analysis in the way of the effectiveness of that equipment in the environment the equipment will probably encounter.
Generally industry spill plans and presentations regarding preparedness make it look like they are prepared and could clean up oil in any environment they encountered in their operations. Pictures of spill response vessels and spill equipment in the Arctic environment give the audience the feeling that the equipment pictured will be onsite and ready to perform the function to the effectiveness that is listed on its nameplate.
The problem is that nameplate capabilities don’t work in the Arctic. Skimmers that performed poorly in the Gulf of Mexico will perform even worse in the Arctic, even if they are “winterized” for Arctic conditions. Sea ice conditions in the Arctic may prevent spill response vessels and equipment from getting close enough to the oil to deploy the equipment. Oil may be entrained in the ice and under the ice where spill response equipment will not be effective. Oil may not collect in sufficient quantities or may be weathered to such an extent that in situ burning is not an available option.
There is documentation of the amount of equipment available to respond to a spill and the potential response times, but there is little analysis of the effectiveness of that equipment in various arctic conditions. The State of Alaska and the MMS need to understand how much oil can be expected to be picked up under different scenarios and what the impact is on the environment from the remaining oil that is not recaptured.
How effective is the use of dispersants in broken ice conditions? What is the impact on wildlife in the water column and on the ice? Some of the dispersant will get on the ice. What if it is injested by wildlife? What would seem unusual for people is not always unusual or uncommon for animals. There is at least one incident on the north slope where a polar bear injested industrial liquids resulting in the death of the polar bear.
Exploration drilling activities are planned to begin on or about July 4th and drilling in hydrocarbon bearing zones would end on or before October 31st, depending on ice and weather. What if a blowout occurred late in the drilling season, or what if sea ice prevented the drillship from getting back on location? There may not be sufficient time to drill a relief well during that drilling season and the drillship may have to return the next summer drilling season to complete the relief well. If the existing drillship burns up in the ensuing fire, the relief rig will not be available to drill a relief well until the next drilling season. What is the impact on the environment from an uncontrolled well blowout that continues to release oil in the environment for 6 months or longer?
Shell’s exploration plan states that “A very large spill from a well-control incident is not a reasonably foreseeable event in connection with the OCS exploration activities set forth in Shell’s EP, and therefore, this EA does not analyze the impacts of such a worst-case scenario.” Lets hope they are right.
You don’t plan for meteors hitting the earth, but you do plan for earthquakes. The likelihood of a catastrophic oil spill in the arctic is somewhere in between the two.
If the state and federal government approve Shell moving forward in the Alaska OCS, they need to understand that a major oil spill from a blowout will not be easier to stop or clean up in the arctic than it was in the Gulf of Mexico. It will be more difficult. The best we can hope for is good management practices and the statistical likelihood that the incident will not occur.
Monday, May 3, 2010
The Red Pen Challenge Update
This morning I called and left messages regarding the Red Pen Challenge at the following gubernatorial campaigns:
Ethan Berkowitz
Hollis French
Sam Little
Sean Parnell
Bob Poe
Ralph Samuels
Bill Walker
Donald Wright
If you know of a candidate for governor that is not on this list that would like to be included in the challenge, please ask them to contact me, or if you are one of the above candidates and somehow did not receive my message, please contact me as well. For the sake of convenience I have reprinted the Red Pen Challenge below.
I call this proposal The Red Pen Challenge.
I propose that every candidate for governor should review the capital budget and identify those items they would veto and submit them to the people of Alaska at the same time the Governor submits his signed capital budget bill, with appropriate vetoes if any, to the people of Alaska.
Rules of the Challenge
1) The governor agrees, in advance, to the date and time he will make public his decision on the capital budget.
2) Each candidate will submit their proposed capital budget to the public on the same date prior to the governor’s submittal to the public.
3) Governors Rules apply. – Each candidate will be required to provide the public with a copy of the budget with the specific “vetoed” items lined out and initialed, just like the Governor is required to do.
4) All newspapers will be encouraged to post on their web pages all responses so the Alaska public can compare the “decisions” of each of the participating candidates and add this information to their overall evaluation of who they want to support for governor.
I believe the above proposal will provide the appropriate scrutiny that was not applied during the legislative process to each and every appropriation in the capital budget.
Since the capital budget has not been transmitted to the governor there is still plenty of time for each of the candidates to comply with the above challenge. They will have the same amount of time to review and analyze the capital budget as the governor has.
I am also certain that if a candidate needs more information about the value of a specific appropriation, the recipient of that appropriation will be glad to provide the candidate with as much information as the candidate needs to make their decision.
I will be contacting each candidate and the governor over the next week to see who will be willing to rise to the challenge. The governor is the only candidate that will automatically participate because he is required by law to make a decision on the capital budget. The governor still needs to agree to a specific date and time when he will communicate his decision on the capital budget to the public.
I am looking forward to sharing their responses to the challenge in a future article.
Ethan Berkowitz
Hollis French
Sam Little
Sean Parnell
Bob Poe
Ralph Samuels
Bill Walker
Donald Wright
If you know of a candidate for governor that is not on this list that would like to be included in the challenge, please ask them to contact me, or if you are one of the above candidates and somehow did not receive my message, please contact me as well. For the sake of convenience I have reprinted the Red Pen Challenge below.
I call this proposal The Red Pen Challenge.
I propose that every candidate for governor should review the capital budget and identify those items they would veto and submit them to the people of Alaska at the same time the Governor submits his signed capital budget bill, with appropriate vetoes if any, to the people of Alaska.
Rules of the Challenge
1) The governor agrees, in advance, to the date and time he will make public his decision on the capital budget.
2) Each candidate will submit their proposed capital budget to the public on the same date prior to the governor’s submittal to the public.
3) Governors Rules apply. – Each candidate will be required to provide the public with a copy of the budget with the specific “vetoed” items lined out and initialed, just like the Governor is required to do.
4) All newspapers will be encouraged to post on their web pages all responses so the Alaska public can compare the “decisions” of each of the participating candidates and add this information to their overall evaluation of who they want to support for governor.
I believe the above proposal will provide the appropriate scrutiny that was not applied during the legislative process to each and every appropriation in the capital budget.
Since the capital budget has not been transmitted to the governor there is still plenty of time for each of the candidates to comply with the above challenge. They will have the same amount of time to review and analyze the capital budget as the governor has.
I am also certain that if a candidate needs more information about the value of a specific appropriation, the recipient of that appropriation will be glad to provide the candidate with as much information as the candidate needs to make their decision.
I will be contacting each candidate and the governor over the next week to see who will be willing to rise to the challenge. The governor is the only candidate that will automatically participate because he is required by law to make a decision on the capital budget. The governor still needs to agree to a specific date and time when he will communicate his decision on the capital budget to the public.
I am looking forward to sharing their responses to the challenge in a future article.
Wednesday, April 28, 2010
A System Failure and An Idea
On the last day of the legislative session the Alaska Legislature passed House CS for CS for Senate Bill No. 230(FIN) am H also known as the capital budget. Its largess rivaled any other capital budget in the history of the State of Alaska. Some said they were being good stewards. Others likened the passage of the bill to irresponsible spending. What is clear is that in Alaska where the Permanent Fund Dividend is sacred and a proposal to tax the people to pay for public services might be cause for a revolt, members of the legislature are not rewarded for exercising fiscal restraint, especially in an election year. Did the system fail or did it produce the results it was designed to produce?
In years where there are not enough funds to balance the budget, legislators are rewarded (by reelection) for cutting the budget and minimizing the pain to their constituents. This usually means cutting special programs with limited constituents and cutting or miminizing the increase in administrative budgets.
In years of plenty politicians get elected for obtaining funds for their communities. If there are no short-term negative consequences, there is generally no opposition to spending, even excessive spending, so long as the legislator’s constituents receive a portion of the benefit of that excess.
In the legislature’s defense, they did pay back the remaining funds that had previously been borrowed from the Constitutional Budget Reserve, and they did forward fund education. So what is the problem with spending a little extra when you have it?
Perhaps that question should be asked of the Alaskans who may be most impacted by excessive spending. Perhaps we should ask the Alaskans who are not at the table and who cannot defend themselves against the poor decisions of this generation. Perhaps we should ask the Alaskans who will bear the costs of such a decision. The costs will be borne by those who are not at the table: the future generations of Alaskans. The financial impacts of excessive spending in the short term and the failure to spend in the context of a long term plan are not borne by the present generation. They are borne by future generations when the poor decisions of this generation finally come to roost. The decision makers of future generations will be blamed for the failure, for the failure to plan, for the failure not to forsee the collapse. But it is the current generation of legislators that should be held accountable.
Luckily there is a balance of power in the Alaska political process. The governor has a right to veto those appropriations he feels are inappropriate or excessive. The governor, unlike the legislature, is not accountable to a small group of constituents from a specific district. The governor can provide the leadership necessary to protect both the present and future generations. The governor can examine each appropriation with an eye to the benefit it will provide to the people of Alaska. The governor can examine each appropriation with an eye to the increased maintenance burden placed on this and future generations. The governor can examine each appropriation with an eye to understanding that perhaps saving in years of plenty is a logical choice to meet the needs of those years when there will be budget shortfalls. Perhaps the governor can provide the balance and leadership that was not available during the legislative process.
But this is an election year. Will election year politics affect the governor’s decisions? Will the governor calculate the number of votes lost by every line item veto? Will the other gubernatorial candidates cherry-pick the line item vetoes they think were wrong in an effort to gain advantage over the governor in the election? Will good decision making by the governor be sidelined in an effort to get reelected?
In light of the pressures of election year politics on good decision making, I have a proposal to make that should balance the field between the candidates and should provide a snapshot of how each gubernatorial candidate would lead the State over the next four years.
I call this proposal The Red Pen Challenge.
I propose that every candidate for governor should review the capital budget and identify those items they would veto and submit them to the people of Alaska at the same time the Governor submits his signed capital budget bill, with appropriate vetoes if any, to the people of Alaska.
Rules of the Challenge
1) The governor agrees, in advance, to the date and time he will make public his decision on the capital budget.
2) Each candidate will submit their proposed capital budget to the public on the same date prior to the governor’s submittal to the public.
3) Governors Rules apply. – Each candidate will be required to provide the public with a copy of the budget with the specific “vetoed” items lined out and initialed, just like the Governor is required to do.
4) All newspapers will be encouraged to post on their web pages all responses so the Alaska public can compare the “decisions” of each of the participating candidates and add this information to their overall evaluation of who they want to support for governor.
I believe the above proposal will provide the appropriate scrutiny that was not applied during the legislative process to each and every appropriation in the capital budget.
Since the capital budget has not been transmitted to the governor there is still plenty of time for each of the candidates to comply with the above challenge. They will have the same amount of time to review and analyze the capital budget as the governor has.
I am also certain that if a candidate needs more information about the value of a specific appropriation, the recipient of that appropriation will be glad to provide the candidate with as much information as the candidate needs to make their decision.
I will be contacting each candidate and the governor over the next week to see who will be willing to rise to the challenge. The governor is the only candidate that will automatically participate because he is required by law to make a decision on the capital budget. The governor still needs to agree to a specific date and time when he will communicate his decision on the capital budget to the public.
I am looking forward to sharing their responses to the challenge in a future article.
In years where there are not enough funds to balance the budget, legislators are rewarded (by reelection) for cutting the budget and minimizing the pain to their constituents. This usually means cutting special programs with limited constituents and cutting or miminizing the increase in administrative budgets.
In years of plenty politicians get elected for obtaining funds for their communities. If there are no short-term negative consequences, there is generally no opposition to spending, even excessive spending, so long as the legislator’s constituents receive a portion of the benefit of that excess.
In the legislature’s defense, they did pay back the remaining funds that had previously been borrowed from the Constitutional Budget Reserve, and they did forward fund education. So what is the problem with spending a little extra when you have it?
Perhaps that question should be asked of the Alaskans who may be most impacted by excessive spending. Perhaps we should ask the Alaskans who are not at the table and who cannot defend themselves against the poor decisions of this generation. Perhaps we should ask the Alaskans who will bear the costs of such a decision. The costs will be borne by those who are not at the table: the future generations of Alaskans. The financial impacts of excessive spending in the short term and the failure to spend in the context of a long term plan are not borne by the present generation. They are borne by future generations when the poor decisions of this generation finally come to roost. The decision makers of future generations will be blamed for the failure, for the failure to plan, for the failure not to forsee the collapse. But it is the current generation of legislators that should be held accountable.
Luckily there is a balance of power in the Alaska political process. The governor has a right to veto those appropriations he feels are inappropriate or excessive. The governor, unlike the legislature, is not accountable to a small group of constituents from a specific district. The governor can provide the leadership necessary to protect both the present and future generations. The governor can examine each appropriation with an eye to the benefit it will provide to the people of Alaska. The governor can examine each appropriation with an eye to the increased maintenance burden placed on this and future generations. The governor can examine each appropriation with an eye to understanding that perhaps saving in years of plenty is a logical choice to meet the needs of those years when there will be budget shortfalls. Perhaps the governor can provide the balance and leadership that was not available during the legislative process.
But this is an election year. Will election year politics affect the governor’s decisions? Will the governor calculate the number of votes lost by every line item veto? Will the other gubernatorial candidates cherry-pick the line item vetoes they think were wrong in an effort to gain advantage over the governor in the election? Will good decision making by the governor be sidelined in an effort to get reelected?
In light of the pressures of election year politics on good decision making, I have a proposal to make that should balance the field between the candidates and should provide a snapshot of how each gubernatorial candidate would lead the State over the next four years.
I call this proposal The Red Pen Challenge.
I propose that every candidate for governor should review the capital budget and identify those items they would veto and submit them to the people of Alaska at the same time the Governor submits his signed capital budget bill, with appropriate vetoes if any, to the people of Alaska.
Rules of the Challenge
1) The governor agrees, in advance, to the date and time he will make public his decision on the capital budget.
2) Each candidate will submit their proposed capital budget to the public on the same date prior to the governor’s submittal to the public.
3) Governors Rules apply. – Each candidate will be required to provide the public with a copy of the budget with the specific “vetoed” items lined out and initialed, just like the Governor is required to do.
4) All newspapers will be encouraged to post on their web pages all responses so the Alaska public can compare the “decisions” of each of the participating candidates and add this information to their overall evaluation of who they want to support for governor.
I believe the above proposal will provide the appropriate scrutiny that was not applied during the legislative process to each and every appropriation in the capital budget.
Since the capital budget has not been transmitted to the governor there is still plenty of time for each of the candidates to comply with the above challenge. They will have the same amount of time to review and analyze the capital budget as the governor has.
I am also certain that if a candidate needs more information about the value of a specific appropriation, the recipient of that appropriation will be glad to provide the candidate with as much information as the candidate needs to make their decision.
I will be contacting each candidate and the governor over the next week to see who will be willing to rise to the challenge. The governor is the only candidate that will automatically participate because he is required by law to make a decision on the capital budget. The governor still needs to agree to a specific date and time when he will communicate his decision on the capital budget to the public.
I am looking forward to sharing their responses to the challenge in a future article.
Monday, April 5, 2010
The Point Thomson Unit - The Next Step in the Process.
In September 2005 the Director of the Division of Oil and Gas, Department of Natural Resources disapproved the Point Thomson Unit (PTU) owners’ 22nd Plan of Development (POD) because “it did not set out a plan to bring the PTU into commercial production within a reasonable time frame.”
The Director believed that the pace of prospecting and development for the PTU should be more aggressive than what the PTU owners proposed; so he rejected the POD. Ultimately the Superior Court upheld his decision rejecting the 22nd POD.
After several years of appeals, and after the current appeal to the Alaska Supreme Court, the next step in the process will be for the Director to explain what he considers necessary to diligently develop the PTU. As a part of that explanation the Director can state that if his determination is not accepted by the PTU owners, the unit will be terminated. This explanation would normally take the form of a proposed POD that would be agreed to by the PTU owners. Once the Director explains what he believes is necessary to diligently produce the PTU, the Director will give the PTU owners at least 30 days notice for an opportunity to comment on the proposed POD.
After the hearing the Director will make a final determination regarding the rate of prospecting and development for the PTU. If the PTU owners disagree with the Director’s decision, they can once again appeal that decision to the Commissioner and to the Superior Court.
The PTU owners’ obligation will be to convince the court that what the Director proposed is “in excess of that required under good and diligent oil and gas engineering and production practices.” Because the decision involves substantial agency expertise and not merely an application of the law, the court will apply the reasonable basis test and give deference to the department in its review of the Director’s decision.
To quote the court “Under the reasonable basis standard of review for administrative decisions involving complex issues involving agency expertise, the court is to give deference to the agency’s determination so long as it is reasonable, supported by evidence in the record as a whole, and there is no abuse of discretion.”
This means that unless the Director grossly oversteps his authority, the Superior Court will uphold his determination. The PTU owners understand this and will not risk losing the PTU over an appeal unless the PTU owners believe the Director clearly overstepped his authority in what he required of the PTU owners.
Once this step in the process is completed the PTU will be back on track moving toward development.
The Director believed that the pace of prospecting and development for the PTU should be more aggressive than what the PTU owners proposed; so he rejected the POD. Ultimately the Superior Court upheld his decision rejecting the 22nd POD.
After several years of appeals, and after the current appeal to the Alaska Supreme Court, the next step in the process will be for the Director to explain what he considers necessary to diligently develop the PTU. As a part of that explanation the Director can state that if his determination is not accepted by the PTU owners, the unit will be terminated. This explanation would normally take the form of a proposed POD that would be agreed to by the PTU owners. Once the Director explains what he believes is necessary to diligently produce the PTU, the Director will give the PTU owners at least 30 days notice for an opportunity to comment on the proposed POD.
After the hearing the Director will make a final determination regarding the rate of prospecting and development for the PTU. If the PTU owners disagree with the Director’s decision, they can once again appeal that decision to the Commissioner and to the Superior Court.
The PTU owners’ obligation will be to convince the court that what the Director proposed is “in excess of that required under good and diligent oil and gas engineering and production practices.” Because the decision involves substantial agency expertise and not merely an application of the law, the court will apply the reasonable basis test and give deference to the department in its review of the Director’s decision.
To quote the court “Under the reasonable basis standard of review for administrative decisions involving complex issues involving agency expertise, the court is to give deference to the agency’s determination so long as it is reasonable, supported by evidence in the record as a whole, and there is no abuse of discretion.”
This means that unless the Director grossly oversteps his authority, the Superior Court will uphold his determination. The PTU owners understand this and will not risk losing the PTU over an appeal unless the PTU owners believe the Director clearly overstepped his authority in what he required of the PTU owners.
Once this step in the process is completed the PTU will be back on track moving toward development.
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