A month ago, Hilcorp Alaska admitted it had a leaking pipeline in Cook Inlet that has been pumping methane and other pollutants into our air and water.
The story made national news. Then we learned the truth: Hilcorp's pipeline actually has been leaking since December 2016.
There's a simple fix to the problem – Hilcorp could simply stop running natural gas through the line to its offshore platforms. But that would mean shutting down production on the platforms for a while, and that, in turn, would mean reduced profits.
Hilcorp's CEO Jeff Hilldebrand didn't get rich foregoing profits. In fact, Forbes reports his net worth at $4.4 billion. Hilcorp's business model in the Inlet and elsewhere? Buy old assets, run them hard, squeeze out profits and absorb worker safety violations and pollution as the costs of doing business.
Hilcorp argues it cannot fix the underwater pipeline now because ice floes make it too dangerous for divers to work. It's true those waters are no place for divers now. But that doesn't take Hilcorp off the hook.
First, Hilcorp assumed the risk of a leak after it started using a pipeline that's been on the bottom of the unforgiving waters of the Inlet for over 50 years. This old pipeline does not have a leak detection system, has a tendency to swing unsupported over the seabed — a known cause of Inlet pipeline releases since the 1970s — and was insufficiently cleaned out when it went from oil to gas service.
But like many corporations driven by profits, Hilcorp made a business decision not to pay to upgrade the pipeline, and to simply roll the dice and continue wringing profits out of the old line, which, incidentally, leaked twice in 2014 according to the Alaska Department of Environmental Conservation.
So, by avoiding the costs to upgrade the pipeline in order to maximize profits, Hilcorp enjoyed a sizable subsidy by passing the risk of polluted water, fish and air onto the backs of Alaskans, including fisherman and fishing communities, who collectively own these public resources under the Alaska Constitution.
According to the Alaska Oil & Gas Conservation Commission, Hilcorp has violated Alaska law more than two dozen times since 2012, including a 2015 incident in which three workers almost suffocated in a confined space (they miraculously lived because one worker fell out of the confined space, regained consciousness in the open air, and pulled the other two to safety).
AOGCC concludes "(t)he disregard for regulatory compliance is endemic to Hilcorp's approach to its Alaska operations."
Finally – and perhaps most glaring – is Hilcorp's inability to address a wintertime problem in Alaska. The public hears time and again about advanced leak and spill response capacities, and how state-of-the-art training and equipment ensure a safe operating environment.
Trust us, oil and gas producers say. Yet if Hilcorp cannot address a leaking pipeline in the Inlet in winter, it has no business operating here or in the Alaska Arctic in the first place.
Now that there's a problem, however, the story has changed, and Hilcorp is telling Alaskans to sit tight for a couple months while it keeps polluting our air and water.
Hilcorp insists there's no harm from the leak, but to date, it has refused to conduct any sampling activities. This is a common ploy, akin to a circular argument: you cannot find harm if you are not looking for it.
And while the science around methane releases in water is not nearly as well-developed as it is for oil spills, natural gas leaks in Russia in 1982 and 1985 produced "serious ecological and fisheries consequences" according to ecotoxicologist Stanislav Patin.
Of course, Hilcorp has invented several reasons as to why it cannot stop production, but every state and federal regulator knows – or should know – Hilcorp simply doesn't want to stop making money for long enough to fix its mess.
Sadly, the federal office overseeing pipeline safety is not sending a strong message to Hilcorp and other operators by giving the company until May to fix the problem.
If there's any risk to divers or other workers, that falls on Hilcorp for making a business decision that put profits over people.
Hilcorp has enjoyed massive tax credits and other subsidies during its short time in the Inlet, and it's reaped healthy profits during a time of fiscal crisis for Alaskans. It routinely flouts the law, and now it refuses to stop polluting the Inlet so it can squeeze out a few more dollars.
That's not just unfair; it's just plain wrong.
Bob Shavelson is executive director of Cook Inletkeeper, a nonprofit organization dedicated to the protection of the Inlet watershed and the life it sustains.