E2 Round-up: Questions follow plan to divide offshore drilling agency, execs point fingers at oil spill hearings, the BP spill reaches Alaska, and the IEA alters its oil forecast

The Los Angeles Times notes that Interior’s announcement “left key questions unanswered about the split, including which arm of the MMS would have final say over whether to proceed with drilling plans.”

* Senators tore into BP as executives pointed fingers

Tuesday featured two Senate hearings with executives from BP, Transocean and Halliburton, the three companies involved with the April 20 offshore rig explosion.

BP had leased the rig from owner-operator Transocean to drill a deepwater prospect, and Halliburton was a contractor on the project that went terribly awry, prompting the continuing Gulf of Mexico oil spill.

The Washington Post summarizes the blame game nicely:

“BP blamed the failure of Transocean's blowout preventer and raised a new question about whether Transocean disregarded ‘anomalous pressure test readings’ just hours before the explosion. Transocean blamed decisions made by BP and cited possible flaws in the cementing job done by Halliburton. And Halliburton said that it had faithfully followed BP's instructions and that Transocean had started replacing a heavy drilling mud with seawater before the well was sealed with a cement plug.”

The Houston Chronicle looks at the fray here. Their piece notes an interesting question that some senators posed. Sens. Jeff Sessions (R-Ala.) and Arlen Specter (D-Pa.) “wondered why a containment dome — built hastily after the spill in a so-far-unsuccessful effort to trap the leaking oil — wasn't constructed and at the ready in case of any disaster.”

* The Gulf of Mexico spill is prompting new criticism of drilling in Artic waters


Time magazine’s Bryan Walsh has a new piece up that looks at new scrutiny of Shell Oil’s plans to drill in Artic waters off Alaska’s coast.

“The energy company Shell has an audacious plan to drill for oil and natural gas in the freezing cold Arctic waters off the state's northwest coast. Shell had planned to begin exploratory drilling this July in the Beaufort and Chukchi seas, where the untouched waters could hold billions of barrels of oil, and the company says it has already spent more than $3 billion preparing for the project,” he writes.

“But environmentalists have seized upon BP's catastrophic spill in the Gulf of Mexico as a reason to slow down Shell's drilling in Alaska. Last week a number of green groups sent a letter to Interior Secretary Ken Salazar urging him to reconsider offshore drilling in that state, citing the even greater safety challenges of the Arctic environment. ‘If you think it's tough to clean up an oil spill in the Gulf of Mexico, it's nothing compared to Alaska,’ says Tom Dillon, the senior vice president of field programs for the World Wildlife Fund (WWF).”

* The International Energy Agency is scaling back projections for the rate of oil demand growth this year

The lower 2010 demand forecast stems in part from “weaker-than-expected consumption in emerging markets,” the Wall Street Journal reports.

“In its monthly oil market report, the Paris-based agency said it expects total crude demand globally this year to average 86.38 million barrels a day, representing a 220,000 barrel-a-day downward revision from April and growth of 1.9%, or 1.6 million barrels a day, from 2009,” their story states.

“Iran and Malaysia have registered lower-than-expected oil demand in recent months, the IEA said, although China—the main driver of the growth in world oil consumption—was still seen logging robust demand.”