Accusations fly in Macondo fallout

As 2011 drew to a close, yet another Deepwater Horizon report surfaced, this time from the National Academy of Engineering. Russell McCulley reports on the findings, as well as other late-year news involving ongoing legal wrangling between BP and its Macondo contractors.

A US National Academy of Engineering study, done in conjunction with the National Research Council and sponsored by the US Interior department, spreads blame for the April 2010 blowout and spill more or less evenly among operator BP and its contractors, for a ‘lack of effective safety management,' and a regulatory system that the authors say splits oversight among ‘a number of agencies, sometimes with overlapping authorities'.

The report, Macondo Well-Deepwater Horizon Blowout: Lessons for Offshore Drilling Safety, maintains that a number of ‘alternative techniques and processes' were available that could have better prepared the Macondo well for temporary abandonment and that management and crew on the Deepwater Horizon rig missed several signs that a blowout was imminent. The report takes aim at blowout preventers in general. ‘BOP systems commonly in use – including the system used by the Deepwater Horizon – are neither designed nor tested to operate in the dynamic conditions that occurred during the accident,' the NAE said in a release. ‘BOP systems should be redesigned, rigorously tested, and maintained to operate reliably.'

While the report does not implicate the Transoceanowned Deepwater Horizon rig as ‘a causative factor' in the blowout, its authors express concerns that ‘aspects of the rig design and operation may have contributed to the casualties of the workers. Furthermore, the loss of the rig may have limited options for recapturing control of the well.'

Operators ‘should have ultimate responsibility and accountability for well integrity . . . because only they possess the ability to view all aspects of well design and operation,' the report says. ‘The drilling contractor should be held responsible and accountable for the operation and safety of the offshore equipment. Both industry and regulators should significantly expand the formal education and training of personnel engaged in offshore drilling to ensure that they can properly implement system safety.'

BP issued a response following the report's release maintaining that ‘multiple' parties were at fault while taking a swipe at Transocean and Halliburton, which performed cementing operations on the doomed well.

‘The findings of the National Academy of Engineering/ National Research Council are consistent with the consensus which has emerged from every official investigation: that the Deepwater Horizon accident was complex and was the result of multiple causes, involving multiple parties,' BP said.

‘From the outset, BP has acknowledged its role in the accident and has taken concrete steps to further enhance safety and risk management throughout its global operations. We have stepped up to meet our obligations in the Gulf, and we continue to encourage Transocean and Halliburton to similarly acknowledge their responsibilities and contribute to those economic and environmental restoration efforts.'

BP remains embroiled in litigation with both companies in federal court in New Orleans. In early December, BP accused Halliburton of destroying evidence relating to post-incident testing of the foam cement slurry used during P&A operations and of failing to produce potentially incriminating computer modeling evidence, which Halliburton claims is missing.

Halliburton fired back, accusing BP of ‘attempting to divert attention from its poor decisions and practices by criticizing the work and reputation of Halliburton'.

‘BP has been aware of post-incident tests for some time, but has chosen this late date in the litigation to mischaracterize the results of such tests,' Halliburton said. ‘Contrary to BP's assertions, the post-incident testing referred to in its motion was not conducted on rig samples or in a manner approved by Halliburton. Rather, the informal testing BP refers to used off-the-shelf materials that yielded results which Halliburton believes have little or no relevance to the case, particularly when pre-incident testing using rig samples and formal lab processes showed that the cement slurry was designed to be stable.'

Federal violations

Meanwhile, BP was hit with another round of accusations that it violated federal regulations during Macondo operations. The Bureau of Safety & Environmental Enforcement issued five incidents of non-compliance, or INCs, including charges that the company failed to conduct an accurate pressure integrity test at the well's 135/8in liner shoe and that BP failed to suspend drilling operations ‘when the safe drilling margin identified in the approved application for permit to drill was not maintained', BSEE said in a release.

BSEE issued an initial round of INCs in October 2011, shortly after the release of the Bureau of Ocean Energy Management, Regulation & Enforcement/US Coast Guard Joint Investigation Team report on the incident. At the time, the agency told BP that further regulatory violations could be forthcoming after BSEE personnel not involved in the JIT had a chance to conduct their own investigation.

In an email response to OE, BP said the issues raised in the most recent round of INCs regarding drilling margins and integrity testing ‘played no causal role in the accident'.

The company concluded: ‘BP intends to appeal these INCs, as well as those issued several weeks ago.'

In mid-December, BP reached an agreement with Cameron that releases the Deepwater Horizon BOP manufacturer from most claims against the company in exchange for a $250 million payment to BP. The operator has reached similar agreements with its Macondo field partners, MOEX and Anadarko Petroleum, as well as Weatherford, which provided the well's float collar.

Under the agreement, BP and Cameron will drop pending claims against each other in federal court as well as any ‘potential claims', BP said in a release. BP will indemnify Cameron for compensatory claims stemming from Macondo, including pollution damage claims. The agreement does not apply to potential civil, criminal or punitive fines against Cameron. The payment will be be used to contribute to the $20 billion trust fund BP was ordered to set up to meet claims and pay for environmental damage from the spill. 

BP chief executive Bob Dudley used the occasion to take a further shot at Transocean and Halliburton.

‘Cameron is the fourth company to settle with BP and contribute to economic and environmental restoration efforts in the Gulf. Unfortunately, other companies persist in refusing to accept responsibility for their roles in the accident and for contributing to restoration efforts,' he said. Additional reporting by editor Audrey Leon

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