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Gulf oil spill: BP corporate culture at center of hearings

August 26, 2010 |  1:00 pm
Federal investigators conducting hearings this week in Houston have been focusing heavily on BP's corporate culture -- hammering executives about whether they have learned from the oil giant's history of deadly disasters, near-accidents and poor safety culture.

“We’re concerned about BP’s supervision, their expertise and their control on the rig,” investigator Jason Mathews told a BP executive at a joint U.S. Coast Guard-Interior Department hearing in Houston on Thursday.

Lead investigator Hung Nguyen, a U.S. Coast Guard captain, admonished BP senior officials for failing to offer a crisp explanation of who was responsible for ensuring safety for BP’s deepwater operations. “Who has the total awareness and accountability of the safe operations of BP’s deepwater operations?” Nguyen asked Kent Wells, a BP senior vice president.

“We try to have everyone worry about safe operations,” Wells said.

“So if everybody is in charge, nobody is in charge? Is that correct?” Nguyen asked.

“I disagree when it comes to safety. I think we want to have everybody feeling like they can stop a job,” Wells said.

Nguyen was incredulous, maintaining that  a key flaw was BP’s command structure, which he has portrayed as murky and confusing.“At the end of the day ... nobody has a good awareness of what’s going on. And nobody is making that next step to make the right decision,” Nguyen said.

Nguyen questioned whether BP had ever established a culture of safety after a rig fire in 2002, the Texas City BP refinery explosion in 2005 that killed 15, and the Deepwater Horizon explosion on April 20 that killed 11 men, causing the worst offshore oil spill in U.S. history.

Wells maintained that BP did learn from the 2005 refinery explosion, and listed changes, such as moving buildings farther away from the refinery and technical upgrades.

“Those are mainly equipment improvements,” Nguyen said. “If you don’t change the safety culture for the entire company, you’re going to have incidents.”

Nguyen asked Wells if BP had ever disciplined a senior executive over a disaster. Wells cited outgoing BP CEO Tony Hayward’s departure, but later acknowledged he didn’t know the details of whether Hayward had been ousted or left on his own. Wells could not list anyone else who had been disciplined.

Investigators asked Wells to read aloud from a deeply critical letter from a U.S. regulatory agency referencing a fire aboard a BP rig in shallow waters in August 2002, and a pressure buildup in the same oil field in November 2002 that forced BP to evacuate the rig.

“These incidents seem to have root causes related to incomplete planning, poor communication, insufficient knowledge or training, and a lack of effective supervision,” the letter said. “The circumstances surrounding these incidents have raised questions about the ability of BP to safely conduct joint operations in the Gulf of Mexico,” the letter said.

Federal investigators also criticized BP’s oversight over various contractors that did much of the work on the rigs involved in the 2002 incidents.

“This appears to indicate that BP does not regard its required oversight of contractor operations to the level of accountability MMS desires,” the 2003 letter continued, referring to the U.S. Minerals Management Service, now defunct.

Mathews also raised the possibility that BP was encouraging its leaders on the rig to rely on their own judgment rather than call BP’s offices in Houston if they felt they needed help.  Mathews referenced a general meeting among senior Houston-based BP leaders to “encourage BP’s top officials on board the rig to let them use their own experience to do the job.”

“So you had the experts [in Houston] and you have the gentlemen on the rig relying on their expertise ... and the people who know the best are not in a position to do the best for the rig,” Mathews said.

An expert witness in July testified that the Deepwater Horizon crew improperly conducted safety tests in the hours before the explosion, tests that could have alerted the crew of a dangerous buildup of combustible natural gas in the oil well.

-- Rong-Gong Lin II in Houston
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