(Transocean drill ship, Discoverer Enterprise, the world's largest. Photo: Company handout/AFP/Getty Images)
by Frank James
One of most relevant news stories in the last 24 hours was in the New York Times. With all the talk about whether to drill for oil offshore or not, there's just this one not so little sticking point that many people probably didn't realize: There's aren't enough ocean-drilling ships to meet today's demand, let alone any signicant new demand.
As President Bush calls for repealing a ban on drilling off most of the coast of the United States, a shortage of ships used for deep-water offshore drilling promises to impede any rapid turnaround in oil exploration and supply.
In recent years, this global shortage of drill-ships has created a critical bottleneck, frustrating energy company executives and constraining their ability to exploit known reserves or find new ones. Slow growth in oil supplies, at a time of soaring demand, has been a major factor in the spike of oil and gasoline prices.
Houston-based Transocean is the largest provider of such ships to the oil industry and sees the logjam in orders lasting for years.
Transocean believes the deepwater market will continue to be constrained until at least 2012. Over three-quarters of the drill-ships currently under construction have already been contracted to oil companies eager to benefit from triple-digit oil prices, Mr. Long said.
And that's with the current orders. If the federal offshore drilling ban were lifted today, that would presumably lengthen the backlog, unless a lot more shipbuilding capacity were added.
Politically, this information would seem to be useful to both sides of the offshore drilling argument. It adds to opponents arguments that such drilling will do nothing to lower present gas prices.
Conversely, advocates could use it to say it argues for dropping the bans urgently since demand since there's such a long lag time before energy from such drilling would come on line.
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Comments
Unleash deep ocean (off-shore is an inaccurate term) drilling and the ships will be built...and quickly. In World War Two, U.S. shipyards built Liberty Ships from keel to launch in four days. With big bucks in the offing, do you think the shipyards couldn't produce oil rig ships in short time? It's amazing to see the arguments that the anti-oil people conjure up.
Posted by: Danforth | June 19, 2008 12:36 PM
Here's another hitch: It is Republican and the Oil Corps' nonsense. President Carter made suggestions thirty(30) years ago and we are still being force-fed the same nonsense: We'll drill our way out of this " crisis "!! When is America going to force our leadership to seek alternative fuels, sources of energy, and not the pollutants, ethanol, coal and nuclear ?!! Don't count on President Bush or Senator McCain, they don't want to see any changes, they like things as they are, just fine !!
SUPPORT OUR TROOPS, BRING THEM HOME, ALIVE AND WHOLE. NOW.
Posted by: Don Fitzgerald, Chicago | June 19, 2008 12:53 PM
Do you think TransOcean is dragging there feet and claiming a blacklog until 2012 to try and get some taxpayer money thrown there way? Nah, I'm sure they believe in lassez fiare economics like every single Republican does, and they would never disrupt the market forces by accepting taxpayer money in the form of corporate welfare.
Posted by: jo | June 19, 2008 1:00 PM
Um, ya, WW2 ships were built real fast so was the Empire State Building (13 months to be exact) When is the last time anything that major was built in such a short time? Ground Zero is still one bit nothing after 7 years!! By the time the pipelines, refineries, ships etc are built it will be YEARS!! Gas is expensive people deal with it! They ay $10 a gallon in Europe HELLO!1 Nobodies starving nobodies dying from it. If they can adjust their lifestyles to expensive gas then we can too! Lets all chip in and save energy as best as we can and invest in other energy options NOW! Gas will never be $1.00 a gallon again, get over it!
Posted by: Scot S. Blakeley | June 19, 2008 1:48 PM
What a great opportunity to revive the U.S.'s shipbuilding industry! The industry is in decline due to labor costs exacerbated by union rules. Cut a deal with the unions and rebuild the industry by using the off shore drilling ships as a primer. You would think that the Democrats would jump at the chance to create jobs.
http://brokengovernment.wordpress.com
Posted by: Ken Moyes | June 19, 2008 1:48 PM
Sounds like the Big Oil companies and their pals in the Republican Party need to build some more oil tankers, like this one:
The SS Chevron Oil/Condoleezza Rice
http://www.hyscience.com/archives/Condoleezza_tanker_LARGE.jpeg.jpg
Posted by: John E | June 19, 2008 1:57 PM
Scot S - do you know one of the reasons why things are not built as fast? Do you think it could be Gov't Regulations. They add costs.
Shipbuilding - great job creator.
Posted by: Terry | June 19, 2008 8:06 PM
John E., two points:
1. That photo looks like a really lousy photoshop job. Can't you do better?
2. The tanker was named for Condoleezza Rice when she was a board member of Chevron Oil. (Chevron frequently names its tankers after its board members.) It was renamed "Altair Voyager" in April of 2001 after she became SOS. So, you're a bit out of date.
Posted by: DaveB | June 19, 2008 9:18 PM
The latest argument being made by some who do not wish to drill for oil domestically both offshore and onshore, is that there are simply not enough ocean going drilling vessels to meet the need.
The U.S. shipbuilding industry, once robust and a world leader, is now nearly gone. A combination of international cost economics and union rules made this industry shrivel up. If it was not for the few military ships being built and refitted, it would have blown away. This is a JOBS opportunity!
Our energy circumstances are calling for drilling both onshore and offshore and a need for ocean going drilling ships. This is a grand opportunity to rebuild the U.S. Shipbuilding industry and create good paying career oriented jobs in the process. These circumstances have placed this opportunity right on our doorstep. Now the question must be asked. What other job opportunities will arise from the search for domestic oil? How many related jobs will be in need of U.S. workers to fill them? The entire supply chain for the drillers and the ship builders, plus the entire delivery chain for both will be, itself, a massive mostly self financed jobs program offering the type of jobs that are the backbone of the American middle class. These jobs would reverberate through the Midwest, especially OHIO, and the Katrina ravaged Gulf Coast. These jobs would require skills to be acquired through training. How about a jobs training program for these and related industries to make these jobs happen? Training means trainers and yet more skilled jobs.
http://brokengovernment.wordpress.com
Posted by: Ken Moyes | June 19, 2008 9:20 PM
DaveB,
It's a real picture and yes it proves that the old saying of "Republicans are in bed with Big Oil" is alive and well and floating in an ocean near you.
Posted by: John E | June 19, 2008 10:09 PM
Yes Terry, government regulations were put into place for a reason. With out these regulations ships/buildings etc would be built without safety in mind and these building companies would cut corners to save themselves millions of dollars. The end result? Sinking ships and crumbling buildings ie: The World Trade Center!!
Because of certain non-regulated tax break rules put in place when the WTC was built, insufficient fire wall protection was applied. You do remember what happened to the WTC right? So lets take government regulations out of oil tankers and have The Exxon Valdez disaster repeat itself all along our shores. Sounds pretty.
Posted by: Scot S. Blakeley | June 20, 2008 7:44 AM
John E, there are two reasons I don't think it's a real picture:
1. The tanker is shown in three-quarter front view, but the Chevron logo and corporate name are shown straight-on. The logo and name were Photoshopped into the picture of the tanker, and the Photoshopper didn't even bother to show the logo and name in the same perspective as the tanker.
2. Ships' names on the bow generally follow the line of the rail; this one doesn't. Again, Photoshopped.
I'm not saying you did the Photoshop job, just that you've been had.
Posted by: DaveB | June 20, 2008 8:23 AM
It is amazing to me the number of excuses the left will throw at the wall in order to delay offshore drilling and exploration in Alaska. Let me make a couple of observations. Essentially, what is at the core of most of their arguments is a jealousy and resentment of people who make more money than they do, plus a deep suspicion of capitalism in general. I guarantee you that if it was the U.S. Govt Oil Company proposing this drilling, these idiots would be all for it. So essentially these people are not opposesed to drilling per say, but who is actually doing the drilling. Now, let's get to the envrionment. The left loves to use this smokescreen as a guise for their anticapitalist motives. Let me just say it as clearly and plainly as I can so these neanderthals can understand - MAN CANNOT DESTROY THE PLANET! The Earth has been around for 4.5 billion years. Species have come and gone, the planet going through violent changes in the process.We are nothing! We are just a mere knat, totally insignificant. We could be gone tomorrow and the Earth would not even shrug. The notion that man can effect the planet is the highest order of arrogance!
Posted by: Mark S | July 2, 2008 12:03 PM