Thursday, September 09, 2010

Backlash begins as BP attempts to spread blame for rig explosion.

So, BP have issued their report on the disaster on the Deepwater Horizon oil rig. And, surprise, surprise, they find that they don't deserve the lions share of the blame for all that went wrong there and are spreading responsibility for the disaster amongst other companies in the hope that they will share the cost of cleaning up the mess and compensating the victims of this disaster.

Inevitably, their report is being condemned as serving the interests of BP.

In its internal report on the disaster, BP said employees of the rig operator, Transocean, missed warning signs a full 40 minutes before the explosion on 20 April, and it identified flaws in the technology deployed by another contractor, Halliburton. The design of the well, for which BP was itself responsible, was not a major factor, the report concluded.

Immediately after the publication of the report yesterday, BP was pitched into a war of words with Transocean, which accused the British oil giant of producing a "self-serving" report designed to conceal BP's own failings.

Billions of dollars rest on whether BP is found to have been grossly negligent, because if so, it will have to take sole responsibility for the costs of compensation to the families of 11 workers who died, federal fines, and the massive clean-up along the Gulf of Mexico coast. If the version of events set out in the report is endorsed by regulators and the courts, BP could claw back some of the costs from its contractors.

BP has so far spent $8bn (£5.2bn) to staunch the gushing well, from which oil flowed freely into the Gulf for three months, and to clean up the Gulf coast. It has promised to put $20bn into a compensation fund to cover economic damage done across the region.

"We have said from the beginning that the explosion on the Deepwater Horizon was a shared responsibility among many entities," said Bob Dudley, BP's incoming chief executive. "This report makes that conclusion even clearer, presenting a detailed analysis of the facts and recommendations for improvement both for BP and the other parties involved."

The 193-page report was commissioned by Tony Hayward, the outgoing BP chief executive, in the days after the Deepwater Horizon rig sank. It was written by the company's safety chief Mark Bly, with a team of 50 engineers.

I don't understand why anyone would take this report seriously. It admits that BP made "a mistake" in ignoring advice given by Haliburton to drill 21 "centralisers" - which keep the cement even as it is being poured into the well - and admits that BP drilled only six. But it is quick to state that this did not contribute to the disaster, because oil and gas escaped in another way.
"This report is not BP's mea culpa," said Edward Markey, a member of a congressional panel investigating the spill. "Of their own eight key findings, they only explicitly take responsibility for half of one. BP is happy to slice up blame, as long as they get the smallest piece." Robert Gordon, an attorney representing more than 1,000 businesses affected by the spill, said: "BP blaming others for the Gulf oil disaster is like Bernie Madoff blaming his accountant."
In issuing this report BP shows that it is simply another massive corporation which operates without conscience. It's motive is profit. And the truth in this instance might harm it's profits. So they issue this report, not even hoping that anyone will believe them, but they do so in the hope that they can prove to their shareholders that they did all that they could to reduce their losses.

Click here for full article.

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