Possible Reason Obama Declared a "Hands Off" Policy Regarding the BP Oil Spill in the Gulf

Day after day reporters relay information about the Gulf of Mexico oil spill, the clean up and containment efforts by BP, and ecological and human interest stories.

One possibility that has not been reported is that BP accidentally drilled into an existing Strategic Petroleum Reserve (SPR) owned by the US government.

Strategic Petroleum Reserves were established in 1975 (due to the oil crisis of the 1970s) when Congress passed the Energy Policy and Conservation Act. This act made it a policy of the United States to create a reserve of up to 1 billion barrels of crude oil. By 1977, oil was being delivered to the new Strategic Petroleum Reserve (SPR). Currently, there are four SPR sites located in Texas and Louisiana able to hold a total of 727 million barrels of crude oil (filled as of December 2009), making it the largest emergency oil stockpile in the world.

Storing the Oil

At the SPR sites, the crude oil is stored in underground salt caverns, carved out of underground salt domes by a process called "solution mining."

First, a well is drilled into a salt formation, followed by injections of massive amounts of fresh water to dissolve the salt. In creating the SPR caverns, the dissolved salt was removed as brine and either reinjected into disposal wells or more commonly, piped several miles offshore into the Gulf of Mexico. By carefully controlling the freshwater injection process, salt caverns of very precise dimensions can be created.

Besides being the lowest cost way to store oil for long periods of time, the use of deep salt caverns is also one of the most environmentally secure. At depths ranging from 2,000 to 4,000 feet (610 - 1,220 meters), the salt walls of the storage caverns are "self-healing." The extreme geologic pressures make the walls rock hard, and should any cracks develop in the walls, they would be almost instantly closed. An added benefit of deep salt cavern storage is the natural temperature difference between the top of the caverns and the bottom-a distance of around 2,000 feet. The temperature differential keeps the crude oil continuously circulating in them the caverns, maintaining the oil at a consistent quality.

The fact that oil floats on water is the underlying mechanism used to move oil in and out of the SPR caverns. To withdraw crude oil, fresh water is pumped into the bottom of a cavern. The water displaces the crude oil to the surface. After the oil is removed from the SPR caverns, pipelines send it to various terminals and refineries around the nation.

Filling the SPR

Oil for the SPR can be purchased by the government from oil companies, as was done in the 1970s and the 1980s. In the late 1990s, the SPR also began using royalty-in-kind oil, which is oil that is given to the government by petroleum operators as payment on leases they hold on the federally-owned Outer Continental Shelf in the Gulf of Mexico.

Instead of paying for the leases with money, the companies give the government oil, which is then put into the reserves.

Using the SPR

In an emergency, when a nation's limited oil supply leads to an adverse impact on national safety or on the national economy, the president may order oil to be withdrawn from the reserve. The president can issue a full "drawdown" in which all the oil from the reserve is released. A limited drawdown may be issued in times where the event threatening national energy supplies and the economy is less severe or expected to be of short duration. A limited drawdown has restrictions on the amount of oil that can be released, as well as for how long. The president may also order a test sale, in which the process of releasing the oil into the marketplace is tested to ensure all personnel know the procedures for a drawdown and all equipment is operational.

In the event of a drawdown, the Department of Energy-which manages the SPR-will offer a specific number of barrels of crude oil from the reserve for sale. The department will select those companies to sell to and can begin delivering the oil within 13 days. Oil can be pumped from the reserve at a maximum rate of 4.4 million barrels per day for up to 90 days before the drawdown rate begins declining as the caverns empty out.

At 1 million barrels per day, the reserve can release oil into the market continuously for nearly a year and a half. There have been two emergency drawdowns from the reserve. The first took place in 1991 during the Persian Gulf War. In order to maintain a stabilized petroleum market during Operation Desert Storm, the government offered 33 million barrels of oil from the SPR for sale; a little more than 17 million barrels were bought and deliveries began within a month. The second emergency drawdown occurred in 2005 after Hurricane Katrina damaged oil refineries in the Gulf Coast region.

The Department of Energy is also authorized to exchange oil from SPR. These exchanges have been used in the past to replace less suitable types of crude oil for higher-quality crude oil. It has also been used for limited, short-duration actions to assist petroleum companies in resolving oil delivery problems, such as the CITGO/Conoco Exchanges in 2000, when a commercial dry dock collapsed, cutting off shipping channels to the refineries. (Fossil Energy Study Guide: Oil)

What Happens to the Ocean and Earth When Massive Amounts of Oil Are Extracted?

Typically, oil is found in sand, shale, or porous rock. Once the oil is extracted, the earth's weight from above causes the land to sink-this is called subsidence.

Parts of Long Beach, California dropped almost 30 feet in the 1940s and '50s due to oil removal. The Goose Creek oil field near Houston was a couple of feet above sea level before WWI; now sizable parts of it are underwater. In Venezuela dikes had to be built to prevent flooding of sunken lands around the oil fields at Lake Maracaibo.

Engineers have figured out two ways to keep land from sinking after oil extraction. One way is to pump water into the area after the oil is extracted. The second way is to use carbon dioxide (an ingredient that causes pop to fizz) to fill up the cavern. Both methods are also used to increase oil production from a well after primary oil reserves are removed. Another reason the CO2 is stored in the ocean is to prevent greenhouse gases in the atmosphere. One of the largest containers of CO2 is the Canadian Weyburn oil field, which began filling with CO2 in 2000 and is eventually expected to store 30 million tons of CO2.

Mines Can Collapse

If all goes as hoped, salt mines can slowly seal as the salt deforms beneath the weight of the rock above. In the worst case scenario, the mines can collapse when leaking groundwater dissolves the salt pillars holding up the roof. The Retsof Salt Mine in upstate New York is a prime example of the latter problem: its 1994 cave-in led to gaping sinkholes, a wrecked bridge, and utility damage.

Drillers Can Accidentally Pierce the Roofs of Mines

In 1980 oil drillers at Lake Peigneur, La. accidentally pierced the roof of the Diamond Crystal Salt Mine 1,200 feet below, ultimately collapsing the bottom of the lake.

In the spectacular whirlpool of destruction that followed, 65 acres of land, 11 barges, two drill rigs, and a tugboat literally went down the drain. Fortunately, no one died in this accident. (Do oil wells make huge caves?)

Summary

If BP did hit one of these underwater oil reservoirs, that could be the reason for BP's secrecy and President Obama's "hands off" policy.

The Minerals Management Service, an arm of the Interior Department, oversees the nation's natural gas, oil and other mineral resources. The agency collects and distributes more than $13 billion per year in revenues from federal leases for offshore and onshore drilling. It also enforces laws and regulations that apply to drilling operations.

How much does Mineral Management Services and President Obama know about what is really going on in the Gulf of Mexico?

Sources

Cecil Adams, Do oil wells make huge caves?, http://www.connectsavannah.com/news/archive/10401/

Fossil Energy Study Guide: Oil, http://www.fossil.energy.gov/education/energylessons/oil/HS_Oil_Studyguide_draft2.pdf

John David Mercer, Press Register AP, Reuters & AP, White House to split up oil agency after spill,Critics say MMS shouldn't both regulate and collect revenues from drilling
http://www.msnbc.msn.com/id/37086443/