An Interview with Rick Steiner on the Kulluk Grounding Impact on Shell Arctic Drilling in 2013 and Beyond

Retired University of Alaska Professor Rick Steiner is, along with Dr. Riki Ott, regarded internationally as a first-rank expert on Alaska's marine ecosystems.  Additionally, Steiner is a highly sought after expert on the effects of oil spills on maritime environments.

Like Dr. Ott, Steiner was recently awarded the Alaska Muckraker of the Year Award from the state's pre-eminent marine environment advocacy group, Cook InletKeeper. Since his retirement, Prof. Steiner has been able to act more independently, and travel significantly more, than he was able to do while working in a university atmosphere and schedule.

After leaving the University of Alaska in 2010, Rick began an organization, Oasis Earth.  Here's the organization's description of what Rick is currently doing with Oasis Earth:

Today, he conducts the Oasis Earth project – a global consultancy working with NGOs, governments, industry, and civil society to speed the transition to an environmentally sustainable society. Oasis Earth conducts Rapid Assessments for NGOs in developing nations on critical conservation challenges, reviews environmental assessments, and conducts fully developed studies. Steiner presents Oasis Earth: Planet in Peril to audiences around the world, a presentation on the global environmental crisis and urgently needed solutions, using over 500 images from the UNEP International Photographic Competition for the Environment and NASA images of Earth from space. He continues to work on oil and environment issues, including oil spill prevention, response preparedness, damage assessment, and restoration. His primary focus is now on ecological habitat and biodiversity conservation; establishing Citizens Advisory Councils to advise industry and government; conservation finance; and extractive industry and environment issues, particularly oil, gas, and mining, in the Arctic and globally. Oasis Earth seeks to persuade government, industry, and civil society of the urgency of the global environment crisis, and the necessary regional solutions, particularly in government policy to incentivize sustainability.

I've known Prof. Steiner for over 20 years.  I dedicated Shadows, my 1993 electroacoustic musical composition about the Exxon Valdez oil spill to Rick, honoring his leadership role in critical decisions early in the spill, that helped save the fledgeling Prince William Sound Aquaculture Corporation Sawmill Bay hatchery from extinction.

I've asked Rick a few questions about what the impact the grounding of the Kulluk might have on how the public perceives Shell as a viable operator in Alaska's Arctic, and about the impact of damage to the vessel on Shell's immediate future plans.  

Near the end of the interview, Prof. Steiner predicts the Kulluk fiasco will keep Shell from drilling at all in the Alaskan Arctic during 2013.  This is significant, as Steiner is one of the most knowledgable people around on this.

Phil Munger:  You’ve been questioning Shell Oil’s methods, plans and equipment for their offshore drilling hopes in Alaska for quite a while. Whether it has been Bristol Bay, the Chukchi Sea or the Beaufort Sea, you have drawn attention to specific shortcomings in each of the company’s projections. Are there common flaws in their efforts and planning that you’ve been able to discern?

 Rick Steiner:  Yes. Shell continues to assert that the company knows what it is doing offshore in the Arctic, and clearly, it doesn’t. Essentially Shell says: “don’t worry, be happy...trust us.” Well, we don’t.

The Kulluk grounding is the most recent in a long line of calamities from Shell’s 2012 Arctic drilling program: the last-minute scramble to retrofit the two rigs, the countless problems with the Arctic Challenger response barge, the failed containment dome test, the near-grounding of the Noble Discoverer in Dutch Harbor, the cursory testing (for about 1 hour only) of the crucial capping stack that would be used to stem a blowout, the stack fire in the Discoverer, the propulsion issues in the Discoverer requiring it to be towed into Seward, the serious safety violations on the Discoverer causing the Coast Guard to detain it in port, and so on. Shell and the Obama administration are in such a rush to drill the Arctic OCS it seems they think they oil may leave…well, it won’t. They are behaving as though this is a Bristol Bay red salmon run, and unless they go and harvest it immediately, they’ll lose it. But this oil and gas has been there for millennia, and there should be no rush to pump it up into our disgracefully inefficient energy economy. These guys need to chill for a bit, and reconsider this folly.

The Kulluk grounding is only the most recent in an embarrassing string of failures not just for Shell, but for the Department of Interior (DOI) as well. (Shell's Arctic drill plan has too many holes).

And that Shell and its contractors did not have a contingency plan for losing a tow on the Kulluk in heavy weather is simply beyond comprehension. It shows the poor safety culture, and contingency planning capability in Shell and the DOI. This is why we need an Arctic Regional Citizens Advisory Council (Arctic RCAC) to involve citizen stakeholders in oversight of all activities offshore.

 Phil Munger:   Shell’s use of the Arctic Challenger, Noble Discoverer and Kulluk seem to be adaptation of proven, hardy hulls, built to withstand the ice, at first glance.  Yet the vessels’ age and long terms of non-use warrant notice.  Shell acquired the vessels rather inexpensively, but spent a lot attempting to update them.  Do you have any thoughts on why they pursued this strategy for important assets of such an expensive campaign?

 Rick Steiner:   Shell’s assertions to the contrary, they seem to still want to cut costs at the expense of safety.  Shell employs a Risk Reduction standard to reduce risk to: “As Low As Reasonably Practicable” or, ALARP.  I have pushed them for years to use a Risk Reduction standard of “As Low As Possible” or, ALAP.   That would entail putting every penny into the system that would enhance safety in any way – like NASA did with the Space Shuttle program after Challenger and Columbia disasters, and the nuclear industry after Three-Mile Island and Chernobyl.  But, Shell still cuts corners.  And this is entirely unacceptable.

Phil Munger:   The failure of the Arctic Challenger’s containment dome package in a benign testing regime was spectacular.  You are seeking more information from the Federal government on what they know about the August and September 2012 tests.  Do you know why your Freedom of Information requests are being delayed while those of others are being met?

 Rick Steiner: We (PEER, where I serve as a Board member) filed several FOIA requests with BSEE and Coast Guard months ago, the agency did not respond, and thus PEER filed suit in US District Court to obtain the information on Dec 21, 2012.  The FOIAs seek information on all aspects of Shell’s Arctic drilling program and government oversight of it; well design and integrity control, BOPs, the capping stack, the containment dome tests, the response barge, their sea ice contingency plans, the oil spill response plan.  Just today, BSEE requested a delay in responding.  This is unacceptable.

Put simply, the federal government is in turmoil regarding its oversight of the Arctic offshore drilling program – The White House, the State of Alaska, the Alaska delegation, and some others in Congress want the Arctic offshore drilling program to go forward without delay, throwing caution to the wind (or on the rocks on Sitkalidik Island).  They are ordering the agencies to facilitate and expedite whatever Shell (and Conoco and others) want.

This is where we, as a society, get into serious trouble, and the Kulluk on the rocks is one recent example of this.  That the agencies cannot even respond to a simple FOIA request within its legally allowed time limit indicates a serious problem.  We need government to do its job here, and that is to act in the highest and best interest of we-the-people, not Shell.  It has yet to be able to do so.

 Phil Munger:   Is the infrastructure of the U.S. Coast Guard in Alaska too thin, too under-funded to support offshore drilling in Alaska?

Rick Steiner:   Absolutely, and the Coast Guard readily admits this.  We know people make mistakes, and equipment fails, and thus there will be more failures in the Arctic offshore environment.  The Coast Guard traditionally does a great job responding to maritime casualties, but not such a great job preventing them.  We need to shift this calculus.  We know that whatever we do in response means little compared to what we do to prevent casualties.

 Phil Munger:   Are there ways to fix that?

Rick Steiner:  Over the last month or so, I have been recommending that the Congress include as part of the fiscal cliff deal, a fix of the federal Oil Spill Liability Trust Fund (OSLTF).  The federal fund, which derives from an 8-cent/barrel tax on oil shipments, now has $2.6 billion in it, but it is almost always used only for oil spill response costs, not prevention. Here is the fix I have been recommending over the past month, forwarded to the delegation, the Coast Guard, and the State:

Summary of proposed amendments to the federal Oil Spill Liability Trust Fund (OSLTF), and oil spill liability provisions of OPA 90 

Rick Steiner (12/14/12) 

Proposed amendments to federal oil spill law: 

1. Raise the per barrel fee on petroleum in OSLTF from 8 cents to a rate of 0.2 percent of oil price, which at $100 oil is 20 cents per barrel. Alternatively, adopt a flat fee of 20 cents/barrel. The fee is currently set to expire on Dec 31, 2017. The proposed enhancement would more than double the current income flow into the OSLTF, from about $500 million/year to over $1 billion/year, and would continue beyond 2017.

2. Impose a new fee in OSLTF on all cargo shipped into and out of U.S. ports, possibly 10 cents/ton, or higher at 0.1 percent of value. Cargo ships involved in spills are covered by the Fund, but pay nothing into it. With over 2 billion tons of cargo shipped into and out of U.S. ports each year, a fee of 10 cents/ton would contribute $200 million annually to the OSLTF. 

3. Clarify and facilitate access to the OSLTF for use for spill prevention measures. Currently, the fund may be used for prevention, but subject to appropriation, and federal appropriators are required to “score” all appropriations against other federal spending. This makes it problematic to access the fund for prevention measures. This language should be changed to eliminate the need for congressional appropriation, and allow the Coast Guard to use the Fund at its discretion, within the Fund’s statutory scope, and continuing its annual report to Congress. As well language should include an annual Request for Proposal (RfP) process, for states, Area Committees, local governments, and others to submit proposals to the Fund. 

4. Eliminate oil spill liability limitations in OPA 90 altogether. This will motivate more responsible conduct by companies, with greater involvement by their insurers in safe operations. 

Currently, there is about $2.6 billion in the OSLTF, and the cap was eliminated in 2008. The enhancements to the fund proposed here will provide a substantial stream of funding available to federal and state agencies to pay costs of reasonable and necessary spill prevention measures in all U.S. waters. This should include rescue and escort tugs where appropriate, continuous ship tracking systems, VTS (e.g. at Unimak Pass and Bering Strait), and additional RCACs (e.g. Gulf of Mexico) as appropriate.

Phil Munger:   Alaska politicians don’t get elected or re-elected unless they support oil development here in ways environmentalists regard as extreme.  Is there a solution to this problem in Alaska’s future?

Rick Steiner:   We certainly hope so.  And this is the essence of the problem.

George W. Bush surprised the world in his 2006 State of the Union address, stating that: “We have a serious problem: America is addicted to oil.”  Very true, but while GW admitted this national addiction, he and his administration did nothing to help the nation break this addiction.

Alaska is even more of a heavy hydrocarbon addict, but has yet to admit it.  The current fossil fuel economy of Alaska is a relatively new phenomenon, becoming dominant only since the discovery of the huge Prudhoe Bay oil field in 1968, and the subsequent construction of TAPS. 

Alaska is now one of the most hydrocarbon-addicted societies in the history of civilization, an oil-sheikdom of sorts. And policies here show that perfectly clearly.  Before joining “government,” our current governor was an oil lobbyist, and even worked with the law firm representing Exxon against Alaska citizens on Exxon Valdez damages.  Go figure!

I have always felt that the greatest toxicity of oil is not its ecological toxicity (although that is a serious problem), but rather, its socio-political toxicity.  Societies rearrange themselves around oil, and in very deleterious ways.  I work a lot around the world on oil and environment social issues (places such as Nigeria) and the “oil curse” is evident virtually everywhere it is produced.  The curse is clearly dominant today in Alaska, and for such a wonderful place, with such a proud tradition and history as Alaska, this is a true tragedy.

The political environment needs to change, to focus on a sustainable future for Alaska, and we are clearly not there yet.  Currently, there is a political panic in Alaska from reduced throughput in TAPS. Well, what the heck did they expect, pumping and selling Alaska oil, a finite resource, as fast as possible at $20 / barrel in the 80s and 90s?  Now the junkies want more.

We certainly need oil money out of politics, and that is a difficult challenge here.  And of course, even the state university system is beholden to oil – I resigned my tenured professorship with the university in 2010 due to the university’s blind allegiance to oil, and its pretentious policies in support of academic freedom only when faculty praise industry.  I criticized risk from oil, and the university, addicted to oil, told me not to, and thus I resigned.

Phil Munger:  We’ve both seen amazing improvements in boat and ship safety in Alaska over the decades.  Yet accidents such as the Kulluk grounding seem to show need for further improvements.  Do you have recommendations?

Rick Steiner:   Just last month, I had a commentary on this issue in many Alaska papers.

We have known for years that the emergency towing/ship rescue capability along the Aleutians and Arctic shipping routes is insufficient.  There are now some 20 large ships each day transiting the Aleutians, each posing a significant threat to the region.  I have been pushing for rescue tugs along the routes since 1995, when the TAPS export ban was lifted.  Then, after Selendang Ayu in 2004, many of us made a strong push for an effective emergency-towing regime across these routes.  But government and industry fell back into their somnambulant state, and did nothing. 

As well, the PWS RCAC has done some remarkable work on this issue, particularly the Aug. 2012 Kallan report.

Phil Munger:   Although the power of the storm that battered the Kulluk and its support fleet hasn’t been attributed to global warming, that may well be the case.  I foresee strong late summer and fall storms off Alaska’s North Slope soon, as the open waters breed weather patterns not seen there in a quarter of a million years.  Is Shell, or anyone, prepared for this?

Rick Steiner:   Put simply, no one is prepared for the dramatic effects of global warming – period.  This is one of the profound examples of humans simply not being able to anticipate and respond to future scenarios of our current hubris.

We are funny monkeys, to be sure.

There is solid information about the relationship between the increase in carbon emissions and the increase in frequency and intensity of storm systems globally, including Katrina and Sandy.  We have had several intense hurricane-force storms in Alaska this past year.  With reduced sea ice in the Bering Sea and Arctic, these storms are much more dangerous to coastal areas, and shipping.  The only real solution to this threat is to reduce global carbon emissions.  Yet Alaska politicians seem hell-bent on continuing our current carbon addiction, thereby compromising the very future of our state.

And we should point out that the storms encountered in the Kulluk travesty are not unusual.  This is indeed winter in the Gulf of Alaska.  Crab fishing boats (which I crewed on out of Kodiak when I first moved to Alaska in the 1970s) work this sort of weather all the time.

Phil Munger:   During the Kulluk emergency and grounding, we’ve seen an interagency, government-corporate structure called the Unified Command created and take over many aspects of the operation.  What have you observed about its workings so far?

Rick Steiner:   The Unified Command (UC) is certainly unified in its defense of Arctic drilling, and in its attempt to minimize public and political the concern over the colossal failure of Shell and government in this affair.

It is simply outrageous that the Kulluk is on the rocks on Sitkalidik Island.  The UC press conferences and positions remind me of the old Zen monk saying that it is: “painting eyeballs on chaos.”  The UC is trying to trivialize the astonishing incompetence of Shell, its contractors, and government.  The command center in the Marriott is a tragic Kabuki dance, where some folks are even running around looking busy in life jackets -- in a downtown Anchorage hotel!

The UC is mostly theater, to assuage the guilt or incompetence in industry and government, and to attempt to allay concerns of the public about this entire program.

The Kulluk grounding is, or should be, another teachable moment…we have had many…after the fact, hundreds of people will seem to care, but before the fact, there are precious few who seem to want to prevent such debacles from occurring.  Again, this equation needs to change.

Phil Munger:  In light of the revelation in the Alaska Dispatch today that Shell was indeed in a hurry to get out of Dodge - eh, Dutch - before New Years to avoid $6 million in taxes, do you have anything to add?

Rick Steiner: I say, great job by the Dispatch reporters on this!

Here again, is perfect evidence that Shell is putting profits over responsible conduct. We have seen this so much in Alaska oil industry and government we are almost desensitized to it.

This entire affair means that we take a "time-out" for 2013...even if the Kulluk (which apparently translates to "Thunder") can be pulled off, it is almost certainly out of commission for 2013. That means not only that their 2013 Beaufort drilling is done, but also their Chukchi as they need the Beaufort rig as a potential relief rig for the Chukchi.

Phil Munger:   Could you describe your ongoing projects for the benefit of readers who are unfamiliar with your work and public service?

Rick Steiner:   Well, I continue to work around the world for a sustainable future for planet Earth, and human civilization.  I am not sure we are being successful.

In light of this, I am currently trying to help to establish local citizens advisory councils for extractive industry projects (oil, gas, coal, and mining) around the world.  We need local people to be empowered to stand up for sustainability.  In this regard, I’m working with Papua New Guinea and other South Pacific nations, on the deep-sea hydrothermal vent mining projects; mining projects in Mongolia, and oil projects in the Caspian, Africa, and elsewhere.  I am currently advancing this concept with the UN Environment Program and IUCN – the World Conservation Union.  And of course, I’ve been trying to establish an Arctic RCAC, and an enhanced safety system for Arctic and Aleutian shipping.

I am also working as an expert witness (with their London law firm) with local Ogoni tribes in the Niger Delta in their pursuit of justice against Shell for environmental damage caused in their region.   And I continue to advise international NGOs, civil society, and governments on energy and sustainability issues. I give presentations called “Oasis Earth”-- using the UNEP/Canon International Photographic Competition for the Environment photos-- everywhere I can, to remind us all to think in different ways about our collective challenge, our collective future on this lovely little ‘wet blue ball.”

I have to say: I don’t really know anymore what works and what doesn’t.  But I do know this extraordinary planet is worth every effort.  We need the writers, artists, bloggers, reporters, musicians, scientists, advocates and activists, the agencies and companies, and politicians to make this work….So, let’s let the good times roll.