Majority of blame for Gulf oil spill lies with BP, two US agencies find

The US agencies' exhaustive report on the Gulf oil spill said complacency and cost-cutting led BP to make a series of decisions that complicated operations and added risk before the rig exploded.

By , Staff writer

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    Kevin Reed of Pensacola weeps as he looks over the oil-defiled shores of Pensacola Beach, Fla. Wednesday, June 23, 2010.
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British oil giant BP deserves the majority of the blame for last year's Gulf of Mexico oil spill, according to a federal investigative report released Wednesday.

The report, which goes furthest in assigning blame to BP, is significant because it is the most exhaustive to date on the circumstances that caused the April 20, 2010 explosion of the Deepwater Horizon oil rig. The blast resulted in 11 deaths and led to the release of 4.9 million barrels, or 206 million gallons, of oil into the Gulf of Mexico, for weeks afterward.

Common themes in the report are complacency and cost-cutting measures. Lending credibility to its findings is the fact it was produced by the two federal agencies tasked with regulating and enforcing offshore oil drilling in the Gulf: the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) and the US Coast Guard (USCG).

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Much of the two-volume, 505-page report follows in the footsteps of an earlier report released in January by a presidential commission assigned to investigate the incident, plus internal reports published separately by BP and rig owner Transocean, as well as others produced by independent groups of environmentalists and university scientists studying the spill.

But the BOEMRE/USCG report is the most expansive in detailing how BP, more than Transocean and Halliburton, the BP contractor responsible for conducting the cement job, violated federal regulations for offshore drilling.

The report said the complacency and cost-cutting led BP to make “a series of decisions that complicated cementing operations, added incremental risk, and may have contributed to the ultimate failure of the cement job” that led to the explosion at the Macondo well site.

Whereas the presidential commission’s report outlined several factors that elevated the risk of a blowout and was more evenhanded in assessing blame among the companies involved, this new report is more meticulous in its narrative, charting 35 steps that caused the accident, the majority of which were assigned to BP.

“This is a bigger report in many ways,” says Tom Bergin, a London-based reporter for Reuters who wrote “Spills & Spin: The Inside Story of BP” (Random House). “It looks into the issues with more detail. It should illuminate more than confuse.”

Among the 35 factors:

• BP and Halliburton failed to perform the casing cement job in accordance with industry recommendations, a factor that contributed to the blowout of the well.

• BP neglected to analyze the risks associated with the cement production of the Macondo well days before the accident.

• The rig crew’s failure to launch the system’s emergency shutdown device until after hydrocarbons had bypassed the blowout preventer, the containment system designed to contain the well rupture.

The report quotes email correspondence as well as testimony from BP personnel to paint a picture of a Macondo well operation that suffered from last-minute company restructuring and procedural changes. These created a high level of uncertainty about the team’s ability to handle a well that, as early as October 2009, is described as unstable after experiencing a series of “kicks” – a severe reaction that happens following an unplanned influx of gas or fluids in the well.

BP failed to conduct a formal investigation to determine the cause of the kicks, according to the report. Among those quoted is John Guide, a BP well team leader, who, in an email dated April 15, five days before the explosion, tells his superior his team is “flying by the seat of our pants” and that the restructuring “is driving chaos” between the concerns of the engineers and the goals of operational management.

“With the separation of engineering and operations I do not know what I can and can’t do. The operation is not going to succeed if we continue in this manner,” Mr. Guide wrote.

Overall, the report describes BP leaders onsite as primarily concerned about cost overruns and “incurring additional costs that they deemed unnecessary.”

“On the operating front, they were no longer given the support and resources to implement the guidelines that could and likely would have prevented the disaster,” says Robert Bea, a professor emeritus of civil and environmental engineering at the University of California at Berkley who organized an independent investigation of the spill, which reported its findings to Congress.

Adds Professor Bea: “Unfortunately they were dealing with a beast and I think they didn’t understand that until it was too late. And that beast was the Macondo reservoir. So when it got down to the point where [operations] were tricky, their previous experience was not adequate to address the complexities of the drilling. That exploited multiple weaknesses that were allowed to flourish.”

The report strikes a self-reflective tone in its criticism of the Mineral Management Service (MMS), the beleaguered regulatory agency that was shuttered in June 2010 following criticism related to the oil spill. “Stronger and more comprehensive federal regulations might have reduced the likelihood” of the blowout, reads the report.

MMS was restructured and renamed as BOERME last year. However, many oil and gas industry analysts complain that the change is only cosmetic and the revamped agency is too close to its predecessor, a dynamic William Reilly, a chairman of the presidential commission, called “embarrassing” earlier this year. Critics say increased resources are needed to hire new blood, especially for qualified inspectors and administrators.

“The same people inside BOERME are the same people inside MMS. That ingrained culture is still the same culture. You can’t keep doing the same thing and expect different results,” Bea says.

A BP spokesman contacted for this story referred to a statement the company issued Wednesday that said the accident “was the result of multiple causes, involving multiple parties, including Transocean and Halliburton.… We continue to encourage other parties to acknowledge their roles in the accident.”

In spreading the blame, BP’s message remains “consistent,” says Reuters’ Mr. Bergin.

“It was quite clear from the onset that pretty much most of the companies involved were not going to brag about their involvement in this situation,” he says. “But the question has always been where is the balance of blame, and this report today puts the balance of blame firmly on BP.”

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