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BP, Transocean, Halliburton blamed by presidential Gulf oil spill commission

By Steven Mufson
Washington Post Staff Writer
Thursday, January 6, 2011; 12:00 AM

The presidential oil spill commission on Wednesday blamed the Gulf of Mexico oil spill last year on "missteps and oversights" by oil giant BP, rig owner Transocean and contractor Halliburton, saying those errors were "rooted in systemic failures" and could happen again.

The commission said that the April 20 blowout at BP's Macondo well was not inevitable, but rather a failure of management in which officials from all three firms ignored critical warning signs and failed to take precautions that might have delayed the completion of the well but also might have averted the environmental disaster.

In a chapter released from the final report due out next week, the commission said: "The blowout was not the product of a series of aberrational decisions made by rogue industry or government officials that could not have been anticipated or expected to occur again. Rather, the root causes are systemic and, absent significant reform in both industry practices and government policies, might well recur."

The document provided a detailed account of the missteps that led to the spill, but most of the details have been revealed in other reports or investigations so far. It recounts fateful decisions by all three major corporate actors, including the failure to use enough centralizers to keep the pipe in the middle of the well, choices about the type of steel pipe used, and failure to heed or share test results suggesting that the cement used to seal the well could fail.

In the case of the failure to use enough centralizers, the report said that "the evidence to date does not unequivocally establish whether" that was a "direct cause" of the blowout, but the commission said that it "illuminates the flaws in BP's management and design procedures, as well as poor communication between BP and Halliburton."

The commission report also cited a Dec. 23, 2009, North Sea incident on one of Transocean's rigs, which the commission said was an "eerily similar near-miss" to what happened at the Macondo well. Though Transocean told the commission the incident was irrelevant, the commission said, "The basic facts of both incidents are the same. Had the rig crew been adequately informed of the prior event and trained on its lessons, events at Macondo may have unfolded very differently."

William K. Reilly, co-chairman of the commission appointed by President Obama, said that the commission had concluded that the blowout reflected "a more pervasive problem" within the oil industry.

"Given the documented failings of both Transocean and Halliburton, both of which serve the offshore industry in virtually every ocean, I reluctantly conclude we have a system-wide problem," Reilly said.

Former senator and commission co-chair Bob Graham stressed the failure of regulators. He said, "The Macondo blowout was the product of several individual missteps and oversights by BP, Halliburton and Transocean, which government regulators lacked the authority, the necessary resources and the technical expertise to prevent."

The Interior Department issued a statement saying that it has "already identified, acknowledged, and spent months working aggressively to reform" offshore drilling. It said it would "continue to make the changes necessary to restore the American people's confidence in the safety and environmental soundness of oil and gas drilling and production on the Outer Continental Shelf."

Last May, President Obama appointed Reilly and Graham to oversee the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling and gave them a January 2011 deadline to submit a report. Unlike Congress, the Justice Department or other probes, the oil spill commission lacked subpoena power but still sought to uncover the reasons for the disaster. It also criticized federal regulators and some Obama administration members for their response to the spill.

But the most detailed descriptions in the chapter released Wednesday were of communications and decisions by BP, Transocean and Halliburton.

"The immediate cause of the Macondo blowout was a failure to contain hydrocarbon pressures in the well," the report said. "Three things could have contained those pressures: the cement at the bottom of the well, the mud in the well and in the riser, and the blowout preventer. But mistakes and failures to appreciate risk compromised each of those potential barriers, steadily depriving the rig crew of safeguards until the blowout was inevitable and, at the very end, uncontrollable."

The report highlighted a series of decisions that led to time-saving and cost-saving measures when alternatives were available. Rep. Edward J. Markey (D-Mass.) said the report showed "that the underlying profits-over-safety pathology may be in temporary remission, but not fully cured."

The report said, "Most of the mistakes and oversights at Macondo can be traced back to a single overarching failure - a failure of management."

BP said it supports the commission's efforts and "is working with regulators and the industry to ensure that the lessons learned from Macondo lead to improvements in operations and contractor services in deepwater drilling." It said that it has already "instituted significant changes designed to further strengthen safety and risk management."

Transocean, meanwhile, sought to place blame with BP and regulators. "Consistent with industry standards, the procedures being conducted in the final hours were crafted and directed by BP engineers and approved in advance by federal regulators," the company said in a statement. "Based on the limited information made available to them, the Transocean crew took appropriate actions to gain control of the well. They were well trained and considered to be among the best in the business."

Halliburton issued a statement sharply criticizing the presidential commission and BP. It blamed BP for failing to run a cement bond log test, which it called "the only means to test the integrity of the cement bond." It said "had BP properly interpreted the negative tests, the tests would have revealed any problems with the cement job." The company also reiterated disputes about the commission's description of February and April lab tests of cement mixtures as failures, and asserted that Halliburton's engineer on the Deepwater Horizon rig had received notice of satisfactory test results. Halliburton also accused the commission of having "selectively omitted information we provided to them."

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