Case Studies: Containment Losses

Let’s look more closely at some representative examples of containment losses from the list presented previously. Each of these situations could have been avoided with the right combination of equipment, processes and people. In each, issues with well integrity and subsurface integrity, combined with human decisions, led to a loss of subsurface containment.

Cold Lake, Canada

Alberta is home to some of the largest deposits of oil sands or bitumen in the world. This unconventional resource is so dense that it can be produced through mining. Drilling techniques almost always employ a form of enhanced oil recovery, such as steam assisted gravity drainage or cyclic steam. Long-term, high-pressure steam injection into bituminous deposits around Cold Lake in Alberta produced seeps of partially liquefied bitumen on the Cold Lake Air Weapons Range. The series of related surface expressions damaged the environment, killed wildlife and cost the operator both resources and the time and expense of cleanup and reclamation. Increased subsurface analysis could have helped to avoid such a costly incident.

Midway-Sunset Oil Field, California

Exploration discovered a large oil field west of Bakersfield, California, in 1894, and since then, operators have produced more than 2 billion barrels of oil from the Midway-Sunset Oil Field. The State of California estimated remaining reserves of about 532 million barrels in 2008, largely due to the success of cyclic steam and steam flooding in the formation. Because of the long history of operations on this site, the subsurface is perforated with thousands of wells through the entire field. The combination of high pressure steam injection and perforation sometimes results in surface expressions manifesting as sinkholes, surface pools of fluid or temporary geysers. Operators prevent against new expressions through a combination of mapping and documentation, as well as changes to their production operations. For example, Chevron ceased injection around a problematic well in this field in 2008.1 Tragically however, nearby operations combined with subsurface integrity issues resulted in a sinkhole of near-boiling water and hydrogen sulfide, which claimed the life of an employee on 21 June 2011.2 At best, surface expressions due to losses of subsurface containment can be isolated, remediated and cleaned. The very worst cases result in loss of human life.

Deepwater Horizon, Gulf of Mexico

Offshore drilling is not within the scope of this course, but the well-known subsurface containment loss that occurred at the Deepwater Horizon drilling rig presents a varied case for study. Both technical failures and human decisions coalesced into one of the worst disasters in the oil and gas industry. One of our experts outlines exactly what happened.


Case Study: Deepwater Horizon – Paul Bommer – The University of Texas at Austin

The Deepwater Horizon was an ultra deep water off-shore drilling rig that was owned by the drilling company Transocean and leased by BP. On April 20th, 2010, during an exploration of the Macondo Prospect, a blowout caused an explosion that eventually sank the rig and killed 11 crewman. Let’s review some events that led up to this disaster, examining corporate culture, communication and decision-making within an industry where safety and profit are both important parts of the equation. And in that equation, safety should always come first.

In 2005, the BP Texas City Refinery explosion killed 15 and injured 180. OSHA, the Occupational Safety and Health Administration of the US Department of Labor, claimed BP had a systemic safety problem. BP was fined 87 million dollars. In 2007, the BP Alaska pipeline leaked 4,760 barrels of oil in a wilderness area. Investigation found that BP was aware of the corrosion problem. 16 million dollars in fines.

In 2007, an investigation panel chaired by US Senator* James Baker concluded that BP had a false sense of confidence about safety. In 2009, a major gas leak at Alaska Central Facility went undetected, and in 2010, the Center for Public Integrity claimed that 97% of OSHA fines went to BP.

This corporate culture paved the way for the Deepwater Horizon incident. The negative pressure test that should have indicated trouble was not correctly interpreted by the crew. This test lowers the pressure inside the well below the reservoir pressure. If a leak occurs, the inside of the well becomes pressurized, and flow occurs. The negative test indicated that the reservoir did indeed have a pathway to the surface, despite all odds that it should not. The pathway was through a failed cement job that was, in part, set up to fail by the cement design and cement job implementation. So the crew missed the definite signs of trouble brewing by coming up with alternative scenarios to justify the test results, and they proceeded with business as usual.

They circulated out the heavy mud for disposal while replacing the mud with seawater in preparation for temporary abandonment operations. As the heavy mud was replaced by seawater, the pressure in the well was made lower and lower. This allowed increasing flow to enter from the reservoir and flow towards the surface. Finally, enough oil and gas had entered the well bore so that the rising and expanding gas began to push the mud ahead undetected by the crew. This resulted in mud rising above the rig floor and extending up into the derrick.

The driller tried to close several blowout preventers, or BOPs, but this had no effect on the oil and gas already in the riser above the BOPs. The mud was followed by gas and oil at the rig floor. The gas then flowed to the closest ignition source, most likely an engine, and exploded. As tragic and disastrous as the explosion and ensuing fire were, the environmental consequences came after. Once the rig sank, enormous amounts of gas and oil flowed into the ocean.

In this satellite image, you can see the impact. The uncapped well flowed uncontained for 86 days and released approximately 3.2 million barrels or more of oil into the ocean. In addition to technical problems and budgetary pressures, several communication errors contributed significantly to this disaster. Here are some important questions to consider. Where were the BP supervisors during the discussion of the negative test? Why were the results of the negative test not required to be communicated to the drilling engineering team on shore before any other actions could be undertaken? Why were these important decisions, tests, and subsequent actions left up to the drilling crew?

Today, the Macondo blowout has been at least the fourth largest in history. At the end of the day, the total cost related to the spill is estimated at 53.8 billion dollars, not to mention the loss of life and the environmental impacts that are, as yet, not completely understood. The underwater memorial to the 11 men who lost their lives because of this disaster stands as a reminder that the industry can never place profit before safety.


1. The Bakersfield Californian, 2014, Oil companies square off over sinkhole death, (accessed April 22, 2017)

2. Los Angeles Times, 2015, What happened to California regulators’ vows to make steam injections safer?, (accessed on April 20, 2017)

*Errata: Video, 01:30 mark; Secretary James Baker

Images: “Deepwater Horizon offshore drilling unit on fire 2010” by United States Coast Guard