Exxon-Led Consortium: Oil Spill Response System Ready To Deploy

HOUSTON (Dow Jones)–A consortium of oil giants led by Exxon Mobil Corp. (XOM) said Thursday that an early version of its containment system for deepwater oil spills is ready for deployment, potentially paving the way for resumption of deepwater drilling in the U.S. Gulf of Mexico.

The consortium said the system will be ready to deploy within 24 hours of a spill and will be able to capture up to 60,000 barrels of oil per day at depths of up to 8,000 feet. The system, similar to the one devised by BP PLC (BP, BP.LN) after months of trying to contain the Deepwater Horizon spill, consists of a capping stack that would be placed atop a leaking well and send captured crude up to vessels in the surface. Its components are now stored on the Texas and Louisiana coasts.

U.S. regulators have said that despite the official end of a deepwater drilling moratorium, they are unwilling to grant drilling permits until it is clear that a spill can be contained. Last week, the head of the Bureau of Ocean Energy Management, Regulation and Enforcement, the agency that oversees offshore drilling, said that he was confident that the oil industry would be able to deploy that containment capability soon.

BOEMRE officials witnessed a test of the system, according to a slide presentation released by the consortium. The consortium, known as the Marine Well Containment Co., was formed by Exxon, Chevron Corp. (CVX), ConocoPhillips (COP) and Royal Dutch Shell PLC (RDSA, RDSB, RDSA.LN, RDSB.LN).