A giant hole in the spill report

The members of the presidential spill commission spent six months putting together the 380-page report issued last week. Unfortunately, they left something out.

The report concluded that the Deepwater Horizon disaster last spring, which killed 11 men aboard the offshore rig, could have been prevented.

It makes it clear that blame for the accident itself lies with the companies directly involved — Halliburton, Transocean and mostly BP, which was in charge of the project.

The disaster resulted from a series of bad decisions by those three companies, the commission concluded.

Those findings weren’t surprising given the public testimony and the earlier previews of its report that the commission released. The panel went on to suggest that the bad decisions represented a systemic failure, not just with those companies, but with the entire industry, and it proposed new regulations and oversight to make deep-water drilling safer.

“Deep-water energy exploration and production, particularly at the frontiers of experience, involve risks for which neither industry nor government has been adequately prepared, but for which they can and must be prepared in the future,” the commission said.

Industry reacts angrily

The industry has condemned the commission’s report because it attempts to take a solitary incident involving an offshore lease holder with a reputation for cutting corners and turn it into an indictment of the entire industry.

In the course of its investigation, though, the commission uncovered troubling evidence that some practices that contributed to the accident weren’t specific to that one rig.

Transocean and Halliburton are among the biggest contractors in their respective fields, hired by every major operator in the Gulf and around the world. If they use the same practices on all their contracts, it’s cause for concern. And if in the case of the Deepwater Horizon they circumvented those policies because of pressure from the operator, that, too, is cause for concern. If they did it once, will they do it again?

Then there’s BP, a company with a well-documented pattern of safety and maintenance lapses across its operations. As if we needed a reminder, even as the commission was releasing its report, the Trans-Alaska Pipeline, operated by a consortium under BP’s control, was once again shut down for leaks.

Yet BP will continue to drill in the Gulf and elsewhere in the U.S. despite its history of safety shortcomings.

Why it could repeat

Which brings us back to what the report left out.

Its most pervasive warning is that the Deepwater Horizon accident could happen again, yet it ignores the most likely source: companies that have already shown they have trouble operating safely.

While it talks about changes in rules governing offshore drilling, it focuses on “self-policing mechanisms” by the industry and stronger government enforcement. It never suggests that companies’ ability to get new permits should be based, at least in part, on their operating history.

In other words, companies with poor safety records shouldn’t have the same access to drilling permits as companies with good ones. If you despoil a major natural resource like the Gulf, you may not get a chance to do it again, at least not for a while.

The idea of considering safety records in issuing permits won some support in Congress this summer – and immediately drew a threat from BP that it might not meet its obligations to the $20 billion claims fund it set up – and it’s also being considered by the Bureau of Ocean Energy Management, Regulation and Enforcement, director Michael Bromwich said last week.

The spill commission’s members have said they discussed it but didn’t include it in the final report.

Risk goes with territory

No amount of regulation, of course, will make offshore drilling risk-free. Oil exploration, especially in extreme environments, is inherently dangerous, and we as a society have determined that the reward – cheap energy – is worth the risk.

That doesn’t mean we should keep giving companies that take unnecessary risks, that gamble with our country’s natural resources and our people’s livelihoods, more chances to fail.

Photo: Copies of the presidential oil spill commission’s report on display at the National Press Club in Washington, D.C., Tuesday, Jan. 11, 2011. (AP/Susan Walsh)