Mariner Energy: The Company Behind the Gulf's Latest Oil Scare

Mariner Energy oil rig burningThe recent fire at a Mariner Energy (ME) oil production platform off Louisiana sent shock waves through Gulf Coast residents and others still dealing with the aftermath of April's deadly explosion and massive oil spill at BP's Deepwater Horizon drilling rig. Relief was widespread as well when news came that the crew on the Mariner platform was safe, and no oil spill was reported. But it has also brought unexpected, and perhaps unwelcome, focus on Houston-based Mariner Energy.

The company describes itself as "one of the leading independent oil and gas exploration and production companies in the Gulf of Mexico," with about 85% of its production coming from offshore facilities -- including a growing number of deepwater developments. Mariner's Vermilion 380 platform, the site of Thursday's incident, is reportedly operating in about 350 feet of water, a depth considered shallow by industry standards.

Tainted by Enron

Mariner was owned by another Houston company -- Enron Corp. But Enron's collapse following a corruption scandal in late 2001 left Mariner in limbo. According to the Houston Chronicle, "the taint of Enron's collapse made it difficult for the firm to get access to financing for several years."

ACON Investments bought out Mariner from an Enron affiliate several years later, with the approval of the U.S. Bankruptcy Court, for $271 million in 2004 -- and the company went public in 2006. Several of Mariner's senior officers, including President, Chairman and CEO Scott Josey, are former Enron executives.

Mariner remained a midsize oil company that's not very well known outside of the industry. It made some headlines this past April when Apache Corp. (APA) announced a merger agreement with Mariner for about $2.7 billion in cash and stock, including $1.2 billion in debt. At the time, Apache's chairman and CEO said Mariner "provides an exciting new platform for growth in the deep water and complements our strengths in the Gulf Shelf and the Permian Basin."

But the deal has not been finalized, and Apache -- which recently bought $7 billion of North American and Egyptian assets from BP -- is reportedly monitoring the Mariner accident closely.

A Checkered Record

Even before that accident, Mariner had come under scrutiny for other safety issues. The Los Angeles Times, quoting federal officials, says there have been over a dozen accidents at Mariner's Gulf of Mexico offshore facilities in the past four years, "including at least four fires and a well blowout." According to the Times, Mariner also paid $55,000 in fines for safety violations this summer. But the article also points out that, looking at the overall oil industry, Mariner's safety record is not the worst.


"The [industry] standards are much stronger than what you might see from even 20 or 30 years ago," says Dr. Alfred Eustes, associate professor at the Colorado School of Mines' Petroleum Engineering Department . "It's remarkable to me, every time I go out to visit various sites, the level of effort that's being put into safety, health and environment. We're living and breathing and eating it. It's one of those kinds of things that we're incorporating into the academic community."

The Interior Department's Bureau of Ocean Energy Management, Regulation and Enforcement is investigating this latest Mariner accident, "to ensure that we find out what happened, how it happened, and what enforcement action should be taken if any laws or regulations were violated."

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CnOWrms1

Rasmussen Reports: 24% of the nation's voters Strongly Approve of the way that Barack Obama is performing his role as president. Forty-seven percent (47%) Strongly Disapprove. The numbers show a high degree of stability. lol. Overall, 42% of voters say they at least somewhat approve of the president's performance. This matches the lowest approval rating yet measured for President Obama. Fifty-seven percent (57%) now disapprove. rotflmao Some of the president's most enthusiastic supporters, such as young adults, are less likely to turn out to vote. In a book released earlier this year, Scott observed that, "The gap between Americans who want to govern themselves and politicians who want to rule over them may be as big today as the gap between the colonies and England during the 18th century." In Search of Self-Governance is available at Rasmussen Reports and Amazon.com.

September 06 2010 at 6:33 PM Report abuse +1 rate up rate down Reply
joeinbost

What is a 55.000 fine for a Multi Billion Company, one less Golf outing to Aruba in Feb. IN comparison it would be like a 10 cents fine for Speeding for you and me

September 06 2010 at 1:37 PM Report abuse rate up rate down Reply
mac2jr

"On the first page I see 11 comments made by you. This leads me to believe you are an obama operative, if not obama himself on a mission to support the passage of what will actually be nothing more than another democrat slush fund, right along with the $787 Billion stimuless that has done nothing more for 90% of Americans that post signs taking credit for work started, and in most cases near my home, finished long before obama came on the scene. If you insist on making so many inane comments I suggest you have the conjones to post under your real name so the American people will know which of obama's appointees or czars you really are" --- Well Pete, it is this way, I am a person that believes in the TRUTH, and finds that most Republicans have NO Idea what the TRUTH IS. Just an average citizen, not connected with President Obama or any Party Organizations....

September 06 2010 at 12:04 PM Report abuse -1 rate up rate down Reply
mac2jr

President Obama will be asking Congress to approve a JOB Bill that is designed to help small businesses, and to help spur on NEW Technology by an influx of dollars for Research and Development. In the past, for every dollar the government invested in the R & D of a new product, the return was nearly 3 to 1 in the private sector; so if the Republicans want to vote this Down, it is they who are keeping America from jobs and advancement into the future..

September 06 2010 at 9:11 AM Report abuse rate up rate down Reply
1 reply to mac2jr's comment
duet2it

But he is not listening to what small business needs, only what he wants people to believe. First people have to have money to spend in order for business to grow, then we can start hiring.

September 06 2010 at 3:09 PM Report abuse +1 rate up rate down Reply
hbp5

macjr: Though provided the money at times for parts of the inventions you say government created, much of the gadgets you give government credit for were actually developed by companies like Bell Labs and others. The government had needs, private industry most often found solutions. Paint has been around since well the caves of prehistoric man. Toilets were created by Sir John Crapper, not some government bureaucracy, Food has well been around since we emerged as amoeba. Government has given us asbestos though, and cigarettes tainted with a variety of chemicals (as a result of a regulatory structure that encouraged cigarette companies to manipulate the delivery of nicotene into theoretically less toxic cigarettes, government also gave us agent orange and in part the current financial crisis which was largely due to the stupidity of wanting everyone to own a home regardless of whether they could afford it or were mature enough to handle the responsibility. So you are correct the government has sponsored quite a few products as well as economic outcomes--some positive, most incredibly destructive. Radar was actually discovered before the second world war by a pair of Germans, unaffiliated with government. The exploitation of the theory was facilitated by a government need met largely by private enterprise. They did also help facilitate the development of non stick pans although even now the chemical properties of that very same material is being questioned in many countries for its knack for entering soft tissue and may be associated with cancer and of course a government official by the name of Al Gore did create the internet.

September 06 2010 at 7:40 AM Report abuse -1 rate up rate down Reply
3 replies to hbp5's comment
mac2jr

To answer a person who posted that Government does NOT produce, only private industry, this person needs an education into the workings of government, especially USA government and departments like NASA and DOD..... It is the worker that produces product, and most workers are the people that come up with the new inventions and ideas. The computer was though created in Government Labs back in the 1930 era, and it was the government of England that produced the products that lead to television, radar, etc. Govenment during times of wars like WWII and in the space race to the stars produced most of the technology that is being used today in your Ipods, Televisions, computers, etc. Almost everything from paint to food to toilets are a product of some government research program that was eventually turned over to, or adapted by a private for profit

September 06 2010 at 6:39 AM Report abuse rate up rate down Reply
mac2jr

BP, Mariner, are WAKE UP CALLS to AMERICA and AMERICANS; we are getting into deep trouble and the self-policing industry is doing little to solve the problems it is creating. Capped wells are failing due to very old and rusty metal, cement that is falling apart, earth cracks, etc., and oil leakage in the Gulf is increasing daily, and will eventually destroy the entire ecosystem..... More rigs being built closer and closer together will hamper shipping and eventually we will have an out of control ship ram a rig, this fear prevented the Whale from operating in the BP disaster.....

September 06 2010 at 6:30 AM Report abuse -1 rate up rate down Reply
mac2jr

The amazing thing about this Mariner Energy Oil Rig fire is that their stock nearly doubled on the Wall Street Stock Exchange, just hours AFTER the news broke about the fire......

September 06 2010 at 6:26 AM Report abuse +2 rate up rate down Reply
1 reply to mac2jr's comment
tjprice48

Why does this happen like that..........maybe its planned.

September 06 2010 at 12:54 PM Report abuse rate up rate down Reply
mac2jr

The article states that the company has been fined many times for safety violations, therefore the inspectors must be doing something.... As for the comments on Obama's ratings, one has to look at his ratings amoung intelligent people, the people running colleges, businesses, hospitals, etc., the rating is near 90% as these people feel that our President is doing ALL the right things to keep us from drowing in the muck caused by the last Administration.... What has Kenya got to do with Gulf Oil, nothing. But if you want to look at oil in Africa, then look to SHELL and the damage it has done there...

September 06 2010 at 6:24 AM Report abuse +1 rate up rate down Reply
1 reply to mac2jr's comment
pete

mac2jr On the first page I see 11 comments made by you. This leads me to believe you are an obama operative, if not obama himself on a mission to support the passage of what will actually be nothing more than another democrat slush fund, right along with the $787 Billion stimuless that has done nothing more for 90% of Americans that post signs taking credit for work started, and in most cases near my home, finished long before obama came on the scene. If you insist on making so many inane comments I suggest you have the conjones to post under your real name so the American people will know which of obama's appointees or czars you really are.

September 06 2010 at 11:04 AM Report abuse -2 rate up rate down Reply
footsiedown

Where is the article about Sharia Law on AOL? No one is trying to build a mosque in the Gulf yet. We talk about another mishap in the Gulf of Mexico as if it is one of the leading issues of the day.

September 06 2010 at 1:39 AM Report abuse rate up rate down Reply