In major environmental upset, Arctic oil drilling begins off Norway

Eni Norway and Statoil's Goliat rig in Arctic waters. (Photo: Statioil)

Publish date: March 15, 2016

MURMANSK – Despite vociferous environmental protest and safety concerns, Norway’s Goliat oil platform, the world’s northernmost rig, has gone into service in the Barents Sea, drawing fire from Bellona over Norway’s zero emissions promise and safety demands for the project.

MURMANSK – Despite vociferous environmental protest and safety concerns, Norway’s Goliat oil platform, the world’s northernmost rig, has gone into service in the Barents Sea, drawing fire from Bellona over Norway’s zero emissions promise and safety demands for the project.

But, at the moment, the oil companies couldn’t appear to be more psyched, despite these concerns.

The 65,000-ton Goliat platform, a floating rig, is the first attempt to produce oil from the Norwegian portion of the Arctic Ocean’s shelf where the Barents Sea and Norwegian Sea meet.

Hauled nearly 25,000 kilometers from a South Korean shipyard aback the Dockwise Vanguard the floating rig is a spearhead effort between the Italian oil giant Eni, and Norway’s state oil concern Statoil to bore into assumed Arctic hydrocarbon riches. Eni owns a 65 percent stake in the operation, and Statoil 35 percent.

By most accounts, everything about the Goliat platform is, as its name suggests, huge, reports National Geographic indicate. At 175 meters, reports the magazine, the Goliat is 16 stories taller than Norway’s highest skyscraper, Trondheim’s Tyholttårnet broadcasting tower, measuring in at 124 meters. That’s bloody tall. And Goliat’s mooring lines, says the same report, are more than a meter thick.

Its accommodations on the Goliat aren’t shabby either: With a 17-story elevator for service crew, it can comfort 120 beleaguered worker, who can take their downtime in a movie theater, health club and Italian designed kitchen and cafeteria while 9-meter waves and paving winds lash the rig in polar darkness, noted National Geographic.

It all sounds pretty lush, were it not for major environmental concerns, and the fact that the rig has already broken a number of conditions laid out for it by the Norwegian government.

Bellona President Frederic Hauge’s concerns lay with the practices and professionalism of Eni Norway, the project’s chief operator.

“The main promise for operating the Goliat platform in the Arctic was that it would produce zero emissions,” said Hauge. “But that promise seems to have gone by the wayside right out of the gate – everything has gone out of control and Eni is not able to uphold that promise.”

Goliat’s first difficulty is leaks of fire retardant foam, which contains so called “black chemicals” which effused during the test stages of the platform. Such leaks occurred numerous times, spilling some 800 kilograms of perfluorinated compounds, or PFCs, which contain a blend of fluourocarbons, and are known to be harful to the climate, said Hauge.

“This is a direct violation of the ‘zero emissions’ terms, which were the most important conditon of the project as established by Norwegian Parliament,” said Hauge. “In early March, Bellona filed an official police report, and I am ineffably surprised, even shocked, that the authorities have up to now not initiated an investigation.”

Karl Kristensen, Bellona’s advisor on industrial waste, said the environmental group is deeply concerned about the numerous violations of Norwegian safety requirements by Eni as well as its flaunting of direct instructions from the Norway’s oil and gas safety oversight body, the Petroleum Safety Authority, on how the violations should be addressed.

“We believe this shows a critical lack of willingness or capability by Eni Norge to comply with the safety standards demanded by the Norwegian government,” said Kristensen.

“For this reason Bellona questions whether Eni Norge should be allowed to continue as operator of the Goliat field, or on the Norwegian continental shelf at all,” he said.

The Goliath platform’s checkered past

The Goliath platform is the second offshore drilling project in the European portion of the Arctic.

The first was the Russia State Corporation Gazprom’s storied Prirazlomnoye platform and field in the Pechora Sea, which in 2014 opened production with 70,000 tons of substandard, low cost crude blend called ARCO.

But at latitude of 71.3 north, said National Geographic, the Goliat is 225 kilometers closer to the North Pole than the Prirazlomnoye.

Still, the Prirazlomnoye drew the first vial of black blood in environmental conditions that years of studies and analyses have concluded is far from fit for industrial oil operations.

The customer of the Prirazlomnoye’s ARCO crude was France’s Total, which in 2012 had sworn off its own Arctic development plans, but was apparently happy to buy Arctic crude produced by others.

There were also numerous construction problems with the Prirazlomnoye platform – which is largely cobbled together from old, failed Norwegian rigs – and a consensus of opinion that any spills that might result from its operation would be impossible to deal with because of Russia’s lack of Arctic oil spill containment infrastructure.

“There is a more than a likely chance of an oil spill resulting from the operation of the Prirazlomnoye platform,” Viktor Petrov, head of the Kola Center for the Defense of Wildlife told Bellona in an interview in 2014. “Even in the event of a medium size spill, oil would coat the entire aquatic area of the Pechora Sea, and in Arctic conditions, oil products will continue to be present for hundreds of years.”

The construction of the Goliath in South Korea was no breeze for Eni either, The Independent Barents Observer news portal reported. The many delays in finishing it, said the portal, drove the platform’s price up from €1.8 billion to €5 billion.

The beginning of drilling was likewise planned for 2013, but that was put off by Norway’s Petroleum Safety Authority until January 2016.

The Goliat field was discovered 16 years ago, and it’s estimated production by the end of the year will be some 100,000 barrels per day, reported the Independent Barents Observer, adding oil will be stored in the floater itself before being reloaded to tankers and sailed to the markets. It will process this oil from its 11 subsea production wells.

The project is expected to be profitable, according to Russian and Norwegian experts, once oil hits $95 a barrel. According to Bloomberg Business, Brent crude was trading on Tuesday for $38.91 per barrel and US WTI at $36.38. Oil prices are expected to remain in this lull for the remainder of the year.

(Anna Kireeva wrote from Murmansk and additional reporting was supplied by Charles Digges in New Orleans.)

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