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THE PROGRESSIVE REVIEW - June 17, 2010
Investigation Shows BP Cut Costs Before Blowout
by: Mike Ludwig
truthout|Report
House Democrats are asking BP Chief Executive Officer Tony
Hayward about risky cost-cutting and time-saving measures
identified by a Congressional investigation that appear
to have increased the risk of a blowout on the Deepwater
Horizon oil rig in the Gulf of Mexico.
"Time after time, it appears that BP made decisions that
increased the risk of a blowout to save the company time
or expense," US Reps. Henry Waxman (D-California) and
Bart Stupak (D-Michigan) said in a letter to Hayward on
Monday. "If this is what happened, BP's carelessness and
complacency have inflicted a heavy toll on the Gulf, its
inhabitants, and the workers on the rig."
The letter states that BP appears to have made "multiple
decisions for economic reasons" that violated industry
guidelines and ignored warnings from BP's own employees
and contractors, including the decision not to deploy a
"lockdown sleeve that would have prevented the seal from
being blown out from below."
Waxman and Stupak asked Hayward to address these decisions
during his testimony before a House investigative sub-
committee on Thursday. He will also join BP Chairman Cal-
Henric Svanberg in a meeting with President Obama on
Wednesday.
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Obama wants the executives to set up an escrow account to
compensate claims resulting from the oil spill. Senate
Majority Leader Harry Reid and fellow Democrats sent a
letter to Hayward Monday asking that the company put away
$20 billion to pay for economic damages and cleanup in the
gulf.
Jason Itkin, a Houston-based attorney representing workers
and companies affected by the spill and the moratorium on
offshore drilling, told Truthout that legal action will
"absolutely" be taken against BP on behalf of those suffer-
ing economic consequences.
"Thousands of workers are off the job, dozens of rigs will
sit idle, and companies now are invoking force majeure
clauses to get out of drilling contracts because of one
corporate irresponsibility," Itkin said.
The Offshore Marine Service Association (OMSA) claims the
temporary moratorium on offshore drilling will have "long
term economic hardships" for gulf coast mariners and
communities, according to a release. Offshore drilling
and other marine industries support 100,000 American
families, according to the OMSA.
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In an April 14 email to a colleague, BP drilling engineer
Brian Morel called the oil well below the Deepwater Horizon
a "nightmare well which has everyone all over the place,"
but Waxman and Stupak asserted that BP cut corners despite
the well's difficulties.
The well took longer to complete than expected and the rig,
which BP leased from Transocean, was 43 days late for its
next scheduled drilling location by April 20, the day of
the catastrophic blowout, according to Waxman and Stupak's
letter. This may have cost BP up to $21 million in leasing
fees and set the context for hurried, cost-cutting measures
that lead to disaster.
One such measure involved testing the cement bond on the
wellhead. Industry standards recommend that the cement
bond between the casing of a deepwater well and surround-
ing formations be tested, and internal warnings from BP
employees and contractors indicated the potential of an
inadequate cement job.
A crew arrived to test the cement bond two days before the
blowout, but BP told the crew their services we no longer
needed and sent them back. The decision not to conduct the
test on the cement bond saved BP more than $100,000 and
several hours of operating time, according to the letter.
One independent expert told the investigative committee
that this decision was "horribly negligent."
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