Preliminary Empirical Assessment of Offshore Production Platforms in the Gulf of Mexico
Resources for the Future
Mark A. Cohen
Resources for the Future; Vanderbilt University - Strategy and Business Economics; Vanderbilt University - Law School
Harvard University; Resources for the Future
January 12, 2011
Resources for the Future Discussion Paper No. 10-66
This paper reports on a preliminary analysis of performance indicators on 3,020 platforms operating in the Gulf of Mexico between 1996 and 2010. Statistical analysis reveals that company-reported incidents (such as blowouts, fires, injuries, and pollution) increase with water depth, controlling for platform characteristics such as age, quantity of oil and gas produced, and number of producing wells. In addition to company-reported incidents, we examine government inspections and the type of enforcement action (warning, component shut-in, facility shut-in, or civil penalty review) following an inspection. Fewer incidents of noncompliance are detected during inspections on deep-water platforms compared with shallow-water platforms; however, the magnitude of the effect of depth on noncompliance is not large. We provide a preliminary analysis of the effect of prior findings of noncompliance, suggesting that noncompliance is persistent. We also find significant variability in both self-reported incidents and noncompliance across leaseholders.
Number of Pages in PDF File: 38
Keywords: Noncompliance, Inspection, Offshore Oil and Gas
JEL Classification: Q50working papers series
Date posted: January 27, 2011
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