New Scrutiny Slams Near-Shore Exploration

Heightened regulatory scrutiny brought on by the Gulf of Mexico oil spill is taking a toll on companies that drill much closer to shore than the deep-sea depths where BP PLC's Macondo well blew out. Heightened regulatory scrutiny brought on by the Gulf of Mexico oil spill is taking a toll on companies that drill much closer to shore than the deep-sea depths where BP PLC's Macondo well blew out. Shallow-water drillers, which operate in less than 500 feet of water and drill mostly for natural gas, have lurched back to activity after work briefly halted in the aftermath of April's BP well disaster. But they rely on short-term, 30- to 60-day contracts with energy companies, making their revenue stream more vulnerable to disruption than deep-water rig owners that sign multiyear contracts. These companies say they shouldn't have to pay the price for a mistake made by their deep-water brethren. But industry critics contend that the Gulf oil spill has brought about needed scrutiny to all offshore drilling...more