Big Oil Fought Off New Safety Rules Before Rig Explosion

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Huffington Post

Big Oil Fought Off New Safety Rules Before Rig Explosion

by
Marcus Baram

NASA image of Oil slick in Gulf of Mexico seen from MODIS on Aqua Satellite. April 25, 2010

As families mourn the 11 workers thrown overboard in the worst oil
rig disaster in decades and as the resulting spill continues to spread
through the Gulf of Mexico, new questions are being raised about the
training of the drill operators and about the oil company's commitment
to safety.

Deepwater Horizon, the giant technically-advanced rig which exploded
on April 20 and sank two days later, is leaking an estimated 42,000
gallons per day through a pipe about 5,000 feet below the surface. The
spill has spread across 1,800 square miles
-- an area larger than Rhode Island -- according to satellite images,
oozing its way toward the Louisiana coast and posing a threat to
wildlife, including a sperm whale spotted in the oil sheen.

The massive $600 million rig, which holds the record for boring the
deepest oil and gas well in the world -- at 35,050 feet - had passed
three recent federal inspections, the most recent on April 1, since it
moved to its current location in January. The cause of the explosion
has not been determined.

Yet relatives of workers who are presumed dead claim that the oil
behemoth BP and rig owner TransOcean violated "numerous statutes and
regulations" issued by the Occupational Safety and Health
Administration and the U.S. Coast Guard, according to a lawsuit filed
by Natalie Roshto, whose husband Shane, a deck floor hand, was thrown
overboard by the force of the explosion and whose body has not yet been
located.

Both companies failed to provide a competent crew, failed to
properly supervise its employees and failed to provide Rushto with a
safe place to work, according to the complaint filed in U.S. District
Court for the Eastern District of Louisiana. The lawsuit also names
oil-services giant Halliburton as a defendant, claiming that the
company "prior to the explosion, was engaged in cementing operations of
the well and well cap and, upon information and belief, improperly and
negligently performed these duties, which was a cause of the
explosion."

BP and TransOcean have also aggressively opposed new safety
regulations proposed last year by a federal agency that oversees
offshore drilling -- which were prompted by a study that found many
accidents in the industry.

There were 41 deaths and 302 injuries out of 1,443 incidents from
2001 to 2007, according to the study conducted by the Minerals and
Management Service of the Interior Department. In addition, the agency
issued 150 reports over incidents of non-compliant production and
drilling operations and determined there was "no discernible
improvement by industry over the past 7 years."

As a result, the agency proposed taking a more proactive stance by
requiring operators to have their safety program audited at least once
every three years -- previously, the industry's self-managed safety
program was voluntary for operators. The agency estimated that the
proposed rule, which has yet to take effect, would cost operators about
$4.59 million in startup costs and $8 million in annual recurring costs.

The industry has launched a coordinated campaign to attack those regulations, with over 100 letters
objecting to the regulations -- in a September 14, 2009 letter to MMS,
BP vice president for Gulf of Mexico production, Richard Morrison,
wrote that "we are not supportive of the extensive, prescriptive
regulations as proposed in this rule," arguing that the voluntary
programs "have been and continue to be very successful," along with a
list of very specific objections to the wording of the proposed
regulations.

The next day, the American Petroleum Institute and the Offshore
Operators Committee, in a joint letter to MMS, emphasized their
preference for voluntary programs with "enough flexibility to suit the
corporate culture of each company." Both trade groups also claimed that
the industry's safety and environmental record has improved, citing MMS
data to show that the number of lost workdays fell "from a 3.39 rate in
1996 to 0.64 in 2008, a reduction of over 80%."

The Offshore Operators Committee also submitted to MMS a September 2, 2009 PowerPoint presentation
asking in bold letters, "What Do HURRICANES and New Rules Have in
Common?" against a backdrop of hurricane activity in the Gulf of
Mexico. On the next page, the answer appears: "Both are disruptive to
Operations And are costly to Recover From".

 

 

 

 

The presentation also included the following statements:

"We are disappointed...

  • MMS fails to understand that as operators, we can place expectations on contractors, but we cannot do the planning for them
    MMS adds a lot of prescriptive record keeping and documentation that does
    nothing to keep people safe"

In addition, TransOcean accountant George Frazer, without
identifying his affiliation with the company, submitted a public
comment on the proposed regulations stating, "I strongly disagree that
a mandated program as proposed is needed," arguing that the proposed
action "is a major paperwork-intensive, rulemaking that will
significantly impact our business, both operationally and financially,"
calling it an "unnecessary burden."

"It does appear to be have been an orchestrated effort among most of
major oil companies and drilling operators," says Defenders of Wildlife
senior policy adviser Richard Charter.

"This event has called attention to fact that there is a
long-standing safety problem in offshore industry," he says, noting
that he gets phone calls from whistleblowers working on rigs who
complain about the work conditions and the environmental damage caused
by such operations."

Brian Beckom, a personal-injury attorney who has sued TransOcean
several times on behalf of workers, says that "the industry preaches
safety, that's what comes out of their corporate mouths, but I know for
a fact that is not always the way things go," though he concedes that
the company is better than most in the industry, especially some of the
smaller "fly-by-night operators". With newer expensive rigs -- BP was
paying $500,000 a day to use Deepwater Horizon -- Beckom says "there is
tremendous pressure to put production first" and safety issues fall by
the wayside.

Industry officials seem to be aware of safety concerns -- in the minutes of a July 2009 meeting
of the Health Safety Environment Committee of the International
Association of Drilling Contractors trade group, one section is titled,
"Stuck on the Plateau." At the meeting, members discussed the
difficulty of lowering the number of safety incidents, how to "rock
over from the incident plateau" especially in light of a shrinking
workforce.

In the current case, the spill's damage has been exacerbated by the
depth of the drilling, causing the oil to spread across a wider area
and impeding clean-up efforts. On Monday morning, response teams failed
to seal off the wellhead with a remote vehicle about a mile under the
surface of the water -- an effort akin to "putting a lid on a peanut
jar from thousands of feet away," explains Charter.

That threatens to make the spill the most damaging since the Exxon
Valdez accident off the coast of Alaska in 1989. It is already the
worst oil rig disaster since a blowout on the Union Oil platform off
the coast of California in 1969 -- the public outrage over that 11-day
oil spill helped spawn the modern environmental movement.

BP and TransOcean did not return calls for comment. Halliburton could not be reached for comment on Monday night.

Here is the proposed rule from the Interior Department's MMS:

MMS-2008-OMM-0003-0001-1

Here is the letter from BP objecting to the proposed rule:

MMS-2008-OMM-0003-0011.1

 

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