Impact of the Deepwater Horizon Oil Spill on USA’s Environment and Econ

Depleting reserves, high oil prices and spectacular offshore discoveries concentrated a global attention to deep water (National Geographic, p.3). Joel and Bourne (2010) claim â€Å"the Gulf of Mexico now accounts for 30 percent of U.S. production, with half of that coming from deep water (1,000 to 4,999 feet)†. The U.S. government roughly calculated that the deep Gulf might contain 45 billion barrels of oil (NG, p.44). Hence, this fact gave new reasons for oil companies to drill oil wells in that region. The Minerals Management Service (MMS), the national agency that administrated offshore drilling, used to claim that the possibilities of blowout were less than one percent, and that if one did happen, it would not release much oil (National Geographic, Joel.K, Bourne, JR. The deep dilemma, October,2010, vol.218., no4, p.42). But an explosive blowout of the Maconda well that occurred in late April contradicts MMS’s statement. Since Deepwater Horizon rig explosion cause d the most serious accidental marine oil spill in history and instantly acquired major political, environmental and economic importance (Robertson and Krauss 2010). According to Deepwater Horizon Accident Investigation Report, a well control incident allowed hydrocarbons to escape from the Macondo well onto Deepwater Horizon oil rig, causing explosions and fire on the rig. The fire proceeded for thirty-six hours until the rig sank (Deepwater Horizon Accident Investigation Report). For approximately three months, hydrocarbons escaped from the container through the blowout preventers and the wellbore, resulting in a spill of national significance (Deepwater Horizon Accident Investigation Report). Worse still, eleven workers died, 205.8 million gallons of oil gushed into th... ...ng years of failed efforts to recover from past destruction. To accomplish its restoration is the most principal challenge now encountering Gulf despite years of unsuccessful approaches to recover from previous damages. According to Cohen’s (1986) oil spillage damage statistics, the environmental impact from the 5 million barrels of oil spilled by the Deepwater Horizon is to exceed $1.5 billion, nevertheless according to Helton and Penn (1999) is to be approximately $13.6 billion (Cohen 2011). Mentioned statistics exclude clean up costs or compensation to private parties that have incurred economic losses (Cohen 2011). Applying the ExxonValdez per gallon estimates to the Deepwater Horizon oil spill would provide an impact estimate varying in value from $105 billion to $239 billion—a figure that includes both environmental impact and economic impact (Cohen 2011).