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BP’s Long, Ugly History of Profit Over Safety

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Tue, Oct 26, 2010 at 10:26 pm

    BP’s Long, Ugly History of Profit Over Safety

    (updated 10-27 with Frontline video link)

    Anyone who thinks BP’s big new promise to put safety before profit should read or watch the ProPublica/Frontline investigation of BP’s wretched safety history, and regulators’ inaction. (The Frontline documentary airs Tuesday). It’s the story of a corporation that for years cut costs to fuel growth above all, viewed safety as a waste of money and baldly lied to regulators.

    From the ProPublica story:

    The investigation found that as BP transformed itself into the world’s third largest private oil company it methodically emphasized a culture of austerity in pursuit of corporate efficiency, lean budgets and shareholder profits. It acquired large companies that it could not integrate smoothly. Current and former workers and executives said the company repeatedly cut corners, let alarm and safety systems languish and skipped essential maintenance that could have prevented a number of explosions and spills. Internal BP documents support these claims.

    I greatly admire ProPublica energy reporter Abrahm Lustgarten, who was the lead investigator on the BP project. He also broke the story of drinking water contamination and other environmental damage caused by the oil industry rush to extract natural gas from deep shale deposits.

    OilWatchdog has pointed to BP’s culture of safety-be-damned for years, and the ProPublica investigation gets backup form a former Environmental Protection Agency safety enforcer who tried to reform BP:

    At first, [the EPA’s Jeanne] Pascal thought BP would be another routine assignment. Over the years she’d persuaded hundreds of troubled energy, mining and waste-disposal companies to quickly change their behavior. But BP was in its own league. On her watch she would see BP charged with four federal crimes—more than any other oil company in her experience—and demonstrate what she described as a pattern of disregard for regulations and for the EPA. By late 2009 she was warning the government and BP executives themselves that the company’s approach to safety and environmental issues made another disaster likely.

    BP workers also live in fear of the dangers posed by the endless cost-cutting”

    Even today, four years after former CEO Tony Hayward pledged to keep a “laser-like” focus on safety, maintenance on the massive turbines that run the company’s Alaska plants has been deferred. Many of these facilities operate without fire and gas detectors, because theirs are outdated and are expensive to replace. Workers in Alaska told ProPublica they fear another deadly BP accident could happen at any moment. ..,

    BP’s flagship $1 billion Thunder Horse drilling platform [in the Gulf of Mexico] nearly sank in 2005 after engineers installed ballast valves backward. And a federal lawsuit over safety concerns on another BP rig, Atlantis, was making its way through the courts even as the Deepwater Horizon exploded.

    BP’s refineries have also paid hundreds of times more in fines for safety violations than other major refiners.

    Pascal, the EPA official, heard in the early 2000s from numerous whistleblowers, especially on the Alaska pipelines, worried for their lives if rampant corrosion led to a blast.

    Pascal demanded that BP investigate the workers’ claims. In a meeting in Seattle in late 2004, the company’s lawyers from the firm Vinson & Elkins showed the EPA an internal investigation that—while critical of BP in some aspects—dismissed many of the concerns.

    “We did not find any evidence that the allegations regarding data fraud in the CIC program had merit,” the report stated, referring to the corrosion maintenance program.

    Pascal remained convinced that an accident was inevitable. She shared her fears with the EPA’s Criminal Investigation Division but said she was told that until an accident occurred, there was nothing to investigate.

    Pascal then took her material to the Department of Justice.

    “I said I had documents which showed the pipelines were in bad shape and that sooner or later there was going to be some kind of a failure,” she said.

    An agent from the Federal Bureau of Investigation traveled to the North Slope to poke around but found nothing that could be knitted into a prosecution. The federal government, Pascal was again told, didn’t have jurisdiction to interfere with oil and gas infrastructure unless a crime had been committed or an accident had already happened. In the meantime BP’s five-year probation period had run out, taking most of Pascal’s leverage with it.

    “I explored that with all kinds of people and I couldn’t find a jurisdictional way in, other than to let it happen,” she said. “So we had to wait.”

    The wait led to 15 workers killed and hundreds injured in the 2005 Texas City refinery blast, to the major Alaskan pipeline spill in 2006–and this year, to the massive Gulf explosion and spill that killed eight workers. All were or will be blamed on cost-cutting gone wild, with complete scorn for weak U.S. regulators.

    If the EPA, the White House, OSHA or drilling safety agencies think they can depend on BP’s latest bunch of overblown safety claims, it is on their heads when the next BP worker dies, or the next spill trashes livelihoods and the environment. “Jurisdiction” excuses can’t be etched on tombstones.

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