Wells You Can't Kill

Hugh Miles · BP's Risky Business

Since the explosion and sinking of the Deepwater Horizon oil rig, a stream of evidence has emerged suggesting that BP's attitude to risk may have contributed to the disaster. At Tony Hayward's congressional inquisition on 17 June, the CEO of BP was accused of choosing risky procedures in order to reduce costs and save time, and Anadarko Petroleum Corp, BP's former partner which owns a quarter of the blown-out well, went even further, accusing BP of 'behaviour and actions [that] likely represent gross negligence or wilful misconduct'. BP denies all charges.

But the view that BP is suffering from 'a serious, systemic safety problem' has been reinforced by a report from the Center for Public Integrity, which has unearthed federal data showing that BP committed more 'wilful' violations of Occupational Safety and Health Administration regulations than any other oil refiner in the US. Two BP refineries alone account for 97 per cent of all 'egregious wilful' citations issued by government inspectors since June 2007. The Deepwater Horizon was a sub-sea rig, not a refinery, but BP has also been accused of cutting corners in its deepwater drilling operations by using a cheaper type of well design more often than its competitors.

'There has been drilling in the Gulf of Mexico for twenty-odd years and thousands of wells have been drilled,' a BP spokesman told me. 'In the last few years BP has moved into slightly deeper water which is more complex from an engineering perspective but not more risky and other companies are doing similar things.' There are currently 90 drilling rigs operating in US waters in the Gulf of Mexico and 30 of these are at depths greater than 1000 feet, the industry definition of deepwater. The recently published BP Statistical Review of World Energy shows that deepwater production in the Gulf of Mexico accounted for nearly a third of the 7 per cent growth in total US oil production least year, making the US the world's fastest growing oil producer.

In 2008 more than half the drilling leases issued by the Minerals Management Service were for deepwater wells and the deepest plunged to 9975 feet, almost twice as far down as the one in which the blow-out occurred. In May, President Obama announced a six-month moratorium on new wells being drilled, but that did not stop federal regulators issuing a further 17 drilling permits for new projects in the Gulf of Mexico, four of them for wells deeper than 9100 feet. On Tuesday a US federal court judge overturned the moratorium on the grounds that the negative impact on local businesses would be too great. The White House said it would appeal the decision.

All deepwater rigs depend on the same piece of equipment to prevent blow-outs, a subsea blow-out preventer or BOP. These are steel structures that can be more than five stories high and each one is supposedly tailored to suit its specific operating environment. No one yet knows why the BOP on the Deepwater Horizon didn’t work, but documents uncovered by US investigative journalists since the disaster occurred have shown that serious problems with BOPs are not uncommon and industry lobbyists have successfully campaigned for fewer regulations governing their use.

Since the accident on 20 April other oil companies operating in the Gulf of Mexico have announced that they are reviewing their safety standards and stepping up enforcement procedures globally to make sure their offshore operations are in no danger of doing a Deepwater Horizon. 'No one knows what the cause of the accident was,' a Shell spokesman told me. 'But everyone is very keen to find out the state of the BOP when it is pulled up from the sea bed. That will tell us a lot more about what went wrong, as well as the well design. Getting to that is critical and we are seriously interested in finding out about it.'

After the blow-out the US Department of the Interior sent federal inspectors to check safety procedures on all deepwater drilling rigs operating in the Gulf of Mexico. Two were found not to be in compliance: BP's Transocean Development Driller II had failed to follow the correct procedure while testing its BOP and Shell's Transocean Nautilus was cited three times for minor infractions. All the problems were rectifiable and inspectors said safety standards were generally high.

Elsewhere in the world, however, safety standards are lower or even non-existent. According to Amnesty International, the amount of oil that’s leaking into the Gulf of Mexico is spilled every year in the Niger Delta. 'Within the industry Norway is viewed as safest in terms of standards,' a former Shell offshore drilling engineer told me. ‘Then the North Sea, then the Gulf of Mexico. In places like West Africa the standards are very much lower and there are rigs operating there which would not be allowed to operate in the North Sea. I know of rigs where the workers were bribed with Rolex watches so that if they completed 10,000 man-hours without an accident then the whole crew would get a watch. If someone broke their arm after 8000 hours, no one would say for another 2000 man-hours so that everyone could get their Rolex.'

Even so, safety standards on the rig are not necessarily the biggest problem. 'Health and safety is not just the domain of the guys wearing hard hats on the drill floor,' the former drilling engineer said. 'On the rig people are generally obsessed with safety but someone can design a well in the office that you can't kill, and it is at the design level that things are going wrong. There is a legacy of wells already drilled around the world with such huge diameters and under such high pressure that it would be very difficult ever to pump down the required volume of liquid necessary to kill them in the event of a blow-out.'