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
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
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
footsiedown

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. Gallup Daily: Obama Job Approval: 45% approve, 48% disapprove FIRE OBAMA!!!!!!!!!!!

September 06 2010 at 12:40 AM Report abuse -1 rate up rate down Reply
wbearl

Again the big question that no Liberal Press is asking, why aren't the Great Governement Inspectors finding these safety violations and fining these oil companies? The US tax payers are paying these Inspectors good money to protect us from companies who want to cheat the system. The Oil Companies as well as the Air Lines, Railroads and numerous other ccompanies will push the safety standards to the limit to save a dollar, all that stands between our safety and them, are the Governement Inspectors. In cases like BP's and now this one, the Inspectors shopuld be held equally responsible and any criminal charges should apply equally to them.

September 06 2010 at 12:31 AM Report abuse rate up rate down Reply
mossypond

Most, if not all, oil and coal companies are owned and run by republicans. No wonder these companies have no respect for the environment, the law, or their neighbors.

September 05 2010 at 11:42 PM Report abuse rate up rate down Reply
1 reply to mossypond's comment
wbearl

Most Oil Companies are public traded stocks. In most cases their largest stock holders are retirement funds. I'm sure that they have stock holders who are Prepublicans. I'm also sure it's a very safe bet there are quite a few Democrats owning stock in oil, since 8 out of the 10 richest politicians in Washington DC are Democrats.

September 06 2010 at 12:24 AM Report abuse +1 rate up rate down Reply
mossypond

Most, if not all, oil and coal companies are owned and run by republicans. No wonder these companies have no respect for the environment, the law, or their neighbors.

September 05 2010 at 11:38 PM Report abuse -2 rate up rate down Reply
sheriff508

Let me continue- Kenya, where BHO's half brother lives, has virtually NO flush toilets!!! Kenya has virtually NO infrastructure to speak of-they have NO toilet paper, use leaves!!! Kenya, and other sub-Saharan countries are the way of SOCIALISM-No wonder they ALL want to come here!! Ever heard of a mass exodus to Cuba??? Great country if you HATE capitalism!!! Some of you nimrods need to go to our neighbor-Canada! Beer is $50 per case, cigs, $10 per pack and higher! Gas is over $1 per liter!! Canadian health care is SOOOO bad, the ER wait averages 22 HOURS!! How about that SOCIALIST crap??

September 05 2010 at 10:47 PM Report abuse rate up rate down Reply
sheriff508

I just have to love the " anti-capitalists" here- They seem to forget that capitalism produced the computer that they are-STUPIDLY-typing on!! Oh yes, I forget that capitalism gave them flush toilets, which about 40% of the people STILL do not have, gave them cars and CHEAP gas, gave them TVs and Ipods, gave them, well, a POOR public education, but that is another story. A CAPITALIST gives EVERY American a JOB-BTW. The GOVERNMENT creates jobs, at the expence of those "evil" capitalists, in the form of, wait for it- TAXES!!

September 05 2010 at 10:37 PM Report abuse +1 rate up rate down Reply
1 reply to sheriff508's comment
footsiedown

great comment

September 06 2010 at 12:46 AM Report abuse -1 rate up rate down Reply