Shell UK was recently fined $740,000 for an accidental release of a mixture of crude oil and hydrocarbon on a North Sea oil platform. It was caused by corroded and deteriorated pipework that failed. The affected equipment had not been maintained for 7 years. Platforms have electrical systems with anodes that serve to electrically polarize steel pipes and structures to resist corrosion.
Santa Barbara platforms Harmony, Heritage, and Hondo have similar equipment. After 25 years, their equipment was deemed to be inadequate and was rebuilt in 2016 to extend protection by 25 years. Hondo is the oldest (49 years), while Heritage and Harmony are 36 years old. Besides exposure to continued corrosion, these platforms have been exposed to storm wave action over their lifetimes, with limited ongoing inspections or strengthening during the years they have been shut down.
Now comes Sable Oil, playing the lottery in California’s coastal environment with a get-rich scheme to restart this ancient equipment. Based on past experience, Sable’s track record does not lend itself to much confidence that Sable can do this safely. Shareholders beware.
