BP Management Blamed for Gulf Oil Spill

Report warns of systemic industry problems, and similar blowout is possible.

January 5, 2011, 6:56 PM

Jan. 5, 2011— -- The National Oil Spill Commission released the scathing first chapter of its forthcoming full report on the investigation into the blowout of BP's Macondo well, concluding not only that BP's chronic failure of management led to the blowout, but that the problems were systemic, and that such a spill could happen again.

On April 20, 2010, the Deepwater Horizon drilling rig, operated by Transocean and leased by BP exploded, killing 11 workers, seriously injuring many others, and spewing 200 million gallons of crude oil into the Gulf of Mexico. It gushed uncontrolled for nearly three months. Halliburton was responsible for cementing the well.

While the conclusions are in just the first chapter of the full report, the commission's findings could have significant implications for the world's oil giants, which are some of the biggest and most profitable companies in the world.

The commission, appointed by President Obama, noted that "most of the mistakes and oversights at Macondo" which led to the mammoth explosion "can be traced back to a single overarching failure -- a failure of management."

Ensnared in a culture of poor management, the inability to communicate concerns and incipient risk taking, BP's well was doomed, said the report.

According to the report, technical and engineering failures led to the blowout itself including a flawed design, shortcuts taken in cementing the well, and failure to manage the blowout once it began.

Warnings of Another Blowout

All those points had already been published, but in this final repot the commission's co-chair said that "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."

The report concludes that "the root causes are systemic and, absent significant reform in both industry practices and government policies, might well recur." That is, a future blowout and resulting oil spill could happen again.

The Department of the Interior responded with a statement that it has "already identified, acknowledged, and spent months working aggressively to reform offshore drilling."

That includes an overhaul of the regulatory body that was created to provide oversight on wells like BP's Macondo.

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