Our readers may recall reports last year of the deadly explosion in November of last year at an oil platform in the Gulf of Mexico, involving a company called Black Elk Energy LLC. A third-party report, commissioned by that company and released August 21st, suggested that the explosion was the result of contract workers’ failure to follow the company’s standard safety protocols. The report by ABSG Consulting Inc., after an eight-month investigation, was undertaken in cooperation with the U.S. Bureau of Safety and Environmental Enforcement (BSEE). ABSG found that contract workers welding a flange onto open piping connected to an oil tank neglected to secure the piping per Black Elk safe work practices, resulting in the ignition of flammable oil vapors and a series of explosions that left three workers dead and several injured.
Black Elk said the report raises a “serious issue” concerning apparent failures by contractor Grand Isle Shipyard to train and supervise contract welders in order to ensure they followed company safety protocols. Company CEO John Hoffman said in a statement:
We owe it to [the victims] and their families to understand how this accident happened. With this ABSG report, I am confident we now know the causes of this tragedy and how to prevent such an accident from ever happening again.
The consultant noted that Grand Isle Shipyard had contracted with Black Elk to perform construction work through an agreement under which it would not to farm out work to subcontractors, and its decision to hire subcontractor DNR Offshore and Crewing Services without informing Black Elk “was one of several causes of the incident,” according to the company.
Black Elk said since the accident it has instituted enhanced oversight of all drilling, major well work and construction projects, and improved its contractor oversight as well. The company says it has “worked to provide support for the victims and their families and cooperated with government officials to analyze the causes of the incident and to implement policy and procedural improvements to minimize the risk of similar incidents in the future.” Following the explosion, the BSEE threatened to shut down Black Elk’s offshore operations if it didn’t improve its safety conditions and submit a performance improvement plan. According to BSEE, Black Elk had been cited for violating federal safety regulations at its offshore platforms 315 times since 2010.
The agency considered about half of the so-called incidents of noncompliance to be minor infractions, but 145 of the violations were labeled “severe or threatening,” requiring a shutdown of pieces of offending equipment, BSEE records indicated. Twelve of those incidents were considered so life-threatening that Black Elk was forced to shut down entire facilities, according to the BSEE. Black Elk was ordered by the BSEE to cease all welding and other “hot work” at its 98 offshore platforms until the agency deemed the company has reduced fire hazards, and barred Black Elk from resuming operations at offline facilities until it took “corrective actions” to address safety deficiencies.
Black Elk had been sued by its shareholders in a Texas state court in January. It was alleged that the explosion, the history of safety violations and the board of directors’ supposed “long history of mismanagement” negatively impacted the company, reducing the potential acquisition price of a company unit and leading Standard & Poor’s Financial Services LLC to downgrade the company’s credit rating.
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