Offshore industry must confront is own denial

The presidential spill commission has concluded that a “failure of management” led to last spring’s disaster in the Gulf of Mexico, which won’t surprise anyone in the oil industry. Ever since the accident happened, other oil companies have been quick to point out that BP, the operator of the well that blew out on April 20 and killed 11 men aboard the Deepwater Horizon rig, has a reputation for cutting corners.

The spill commission found that BP didn’t have adequate safety controls in place and that it didn’t ensure its engineers were making sound decisions in the months leading up to the accident. One commission member told the BBC that BP had “a whole sequence of poor decisions with unfortunate consequences when put together”.

But the commission’s finding go much farther, extending the poor oversight of the drilling operation to rig owner Transocean and to Halliburton, which handled the cement job. Those companies were both working under BP’s purview, of course, but the commission found some disturbing things that go beyond this one project:

The blowout was not the product of a series of aberrational decisions made by rogue industry or government officials that could not have been anticipated or expected to occur again. Rather, the root causes are systemic and, absent significant reform in both industry practices and government policies, might well recur.

We’ve seen bits of this creeping out in testimony conducted before the Coast Guard and the Bureau of Ocean Energy Management, Regulations and Enforcement this summer. For example, rules for maintaining blowout preventers, a key safety device on rigs, weren’t followed consistently.

Even now, the industry’s most common defense is to tout its safety record. The result has been a sense of complacency that’s crept over the industry even as it moves into deeper water and drills more complex wells.

BP, of course, was quick to latch onto the findings, to argue that this disaster could have happened to any of its deepwater rivals. But the commission’s findings reveal a two-pronged problem. One is issues with BP itself, and the other is issues with the industry overall.

Even if BP’s poor decisions on well design and other planning laid the foundation for the problem, it’s clear that equipment and procedures long thought to prevent a disaster, didn’t work. It’s also clear the industry had lulled itself into thinking it didn’t need a response strategy for such as disaster because one wouldn’t happen.

BP has shown consistent denial in addressing its safety lapses. The question, though, is whether the offshore industry is willing to confront its own denial.

Here’s the advanced chapter of the report, which will be released in full next week:

Chapter 4

Photo: An oil mass floats in the Gulf of Mexico near Orange Beach, Ala., on Friday, June 18, 2010.  (Kari Goodnough/Bloomberg News)

5 Comments

  1. Dollar

    I think these findings are mostly political, they must come up with something to support the presidents decision for the moratorium, and the slow permitting.

    Pure and simple politics and they gotta make the boss look good.

    There is BP and then there is the oil industry. Anybody whose paid any attention to the industry over the past 10 years, recognizes this. Trying to measure the rest of the oil industry by BP standards, is nothing but smear job.

    #1
  2. Eric

    “..a sense of complacency that’s crept over the industry…”. “…the industry had lulled itself into thinking it didn’t need a response strategy…”.

    Cmon, Steffy. If you’re going to paint the entire industry with the same brush, back it up.

    You’re a better journalist than that.

    #2
  3. ntangle

    TO’s N. Sea incident with Shell in Dec/2009 is a little eerie. Since they’d also performed a negative pressure test and started displacing the mud, but were saved by a functional BOP. Refer to page 124 in the report.

    #3
  4. Bob Johnson

    What a fantastically complex process. It is easy to imagine the pressures on the decision makers. Chapter 4 made it clear to me just how critical each decision is. I suppose that the findings of the commission could be considered political, but it is hard for me to imagine that the tenuous nature of the process doesn’t cause the same bottom line pressures across the industry.

    #4
  5. Tex

    Steffy writes: “For example, rules for maintaining blowout preventers, a key safety device on rigs, weren’t followed consistently”.

    We know that:
    1. The Trans Ocean drilling crew failed to recognize the well was flowing in spite of numerous indicators and plenty of warning time.
    2. The Trans Ocean drilling crew failed to close in the well or perform an emergency disconnect prior to the first explosion, which severed communications with the BOP.
    3. Trans Ocean did not maintain the BOP adequately. The dead-man function was not working and had not been tested.
    4. One of the BOP ROV closing function were incorrectly plumbed.

    Perhaps it is time for Steffy to educate himself on complex deep-water operations and look beyond BP in order to get the entire story out to the readers and not just words that fit his own agenda.

    I have never seen a more self-serving and biased writer.

    #5