BP President: 'We Are Responsible'

Aug. 9, 2006 — -- BP America President Bob Malone told ABC News' Betsy Stark in an interview that the shutdown of a Prudhoe Bay oil field pipeline in Alaska would last for months, and promised the company would work to improve its safety management programs.

But as far back as three years ago, Malone denied he had received advanced warning about the possibility of corrosion problems.

"I've apologized publicly. …" Malone said. "We're the operator of the Prudhoe Bay oil field, and we are responsible for its safe operation."

Watch Betsy Stark's full interview tonight during "World News"

The company faces scrutiny from the federal government and environmental advocates after it announced this week that it was shutting down Prudhoe Bay due to a corroded pipeline. Malone said the company spends millions on monitoring and maintaining the pipeline.

"Our integrity management system … we spend $200 million a year, about a third of that is on our corrosion program," he said. "We believed we were doing all that we could to detect corrosion and ensure the integrity of our operations."

BP, the world's second-largest oil company, discovered the extent of the corrosion with tests that the federal government ordered after a big oil spill last March at Prudhoe Bay. Malone said the company would be "modifying" its corrosion-detection system as a result of the shutdown.

Congress has pressed for hearings into BP's pipeline-maintenance practices. BP had not internally inspected or cleaned the severely corroded pipeline for at least 14 years, according to U.S. Department of Transportation records.

'It's Going to Be Months'

Chuck Hamel, an oil industry critic, said he warned BP's upper management, including Malone, about the possibility of dangerous corrosion in an e-mail in 2003. But Malone said he didn't recall the early warning.

"In February 2003 I was in charge of BP shipping. If he did, I don't recall that. I was based in London," Malone said.

The pipeline repairs, including replacement of 16 miles of pipe, are expected to take months, curtailing Alaskan oil production into next year.

"It's still early days, so we're looking at all the various options we have. It's definitely going to be months," Malone said.

The Prudhoe Bay is the nation's largest oil field, producing about 400,000 barrels a day, which is about 2.6 percent of the nation's daily supply.

Alaskan oil goes primarily to West Coast refineries, and officials feared the production interruption could push gasoline prices higher at the pump. Gas prices climbed to a nationwide average of $3.04 this week, nearing the all-time high of $3.07 hit shortly after Hurricane Katrina devastated Gulf Coast refineries last fall.

"We are doing and are focused on doing all we can to bring production back online," Malone said.

Some of the information in this story was compiled from wire services.