What does the Gulf spill mean for Russian offshore oil projects?

Timon Singh

With the United States of America facing the worst oil spill in their history and BP being dragged over the coals by both the US Senate and environmental groups, Russia must be looking at future offshore oil projects with a more cautious eye.

Ever since BP's rig exploded three weeks ago, killing 11 workers and sending 5000 barrels of oil per day into the Gulf of Mexico, many oil-producing countries have considered a 'pause' on offshore oil projects pending safety investigations.

Currently both Canadian and US lawmakers are reviewing safety measures with questions being asked such as why wasn't there a remote safety trigger to stem the flow during the rig fire and why is there no clear contingency for oil leaks a mile below the surface?

With Russia offshore oil projects, such as in the Yamal Penisula, a priority for the Russian oil and gas industry, is there the potential for the same happening in Russian waters?

Could there be a Russian oil spill in the Arctic?

Apart from the environmental damage, there is one main reason why Russian oil companies will no doubt that precautions in the Arctic - cost. The damage caused by the Gulf of Mexico spill is already estimated at several billion dollars, and that is not even taking into account long-term damage to the local economy and communities.

It is also more pressing for Russia as offshore oil projects are a major part of their oil and gas industry, with projects all around the world, especially in the Arctic where conditions are much more difficult and hazardous in the Gulf of Mexico. After all, it is one thing to produce oil in the open waters, but it's a different thing to do this under a layer of ice miles from any form of support of specialised clean-up infrastructure.

It is even more worrying when there are currently no effective technologies that have been developed to eliminate large-scale spills under an ice layer. As such, there is a long of pressure by ecologists and environmentalist for this technology to be fully developed before energy companies continue with their offshore oil projects.

There is a plus side for Russian oil companies though. In the Gulf of Mexico, there are several hundred wells increasing the odds of a potential disaster. In comparison, there are a tiny number of wells on the Arctic shelf reducing the chances of an accident... however, anything is possible.

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