A number of critics of British Petroleum believe cost-cutting by the London-based oil giant helped to contribute to the rig explosion and oil spill disaster unfolding in the Gulf of Mexico. For example, Tom Bower, author of the 2009 book The Squeeze: Oil, Money and Greed in the 21st Century, says that “BP’s economizing led to a lack of engineers, an overdependence on out-sourcing, and even a lack of supervisors to keep an eye on the sub-contractors.”
We have learned that a number of different problems either caused or contributed to the explosion and the massive oil spill that followed. It was discovered that BP had not filed a plan to specifically handle a major oil spill from an uncontrolled blowout at its Deepwater Horizon project. The logical question is – how could this be? It’s because the federal agency that regulates offshore rigs changed its rules two years ago to exempt certain projects in the central Gulf region. According to the Minerals Management Service (MMS), an arm of the Interior Department, and known for its cozy relationship with major oil companies, the agency issued the relief from the rules because some of the industry wide mandates weren’t practical for all of the exploratory and production projects operating in the Gulf region.
The blowout rule was lifted in April 2008 for rigs that didn’t fit at least one of five conditions. The question now is whether the BP Deepwater Horizon project was covered by the regulation. Interior Secretary Ken Salazar believes that BP was required to file plans for coping with a blowout at the well that failed. But a review of government and BP documents by the Associated Press found that the company had not filed a specific comprehensive blowout plan for the rig that exploded. Instead, a site-specific exploration plan filed by BP in February 2009 stated that it was “not required” to file “a scenario for a potential blowout” of the Deepwater well. That’s shocking to say the least.
The lack of a specific plan for the Deepwater project raises questions about whether BP could have been better prepared to deal with the ongoing disaster and whether MMS is fulfilling its regulatory oversight. BP clearly was not prepared for a disaster of this sort, and neither do I believe MMS has done its job. In its 2009 exploration plan for the Deepwater Horizon site, BP strongly discounted the possibility of a catastrophic accident. Similarly, Shell’s environmental impact analysis for its Beaufort Sea drilling plan asserts that the possibility of a “large liquid hydrocarbon spill … is regarded as too remote and speculative to be considered a reasonably foreseeable impacting event.”
The Deepwater Horizon disaster is not the first time MMS has been criticized as being too close to the oil industry. In 2008, the Interior Department took disciplinary action against eight MMS employees who accepted lavish gifts, partied, and – in some cases – had sex with employees from the energy companies they regulated. An investigation cited a “culture of substance abuse and promiscuity” involving employees in the agency’s Denver office.
Source: Associated Press
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