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Oil companies pass the buck for Gulf spill

Discussion in 'Biashara, Uchumi na Ujasiriamali' started by MziziMkavu, May 11, 2010.

  1. MziziMkavu

    MziziMkavu JF-Expert Member

    May 11, 2010
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    At hearing, senator predicts 'liability chase' among well partners

    [​IMG]Jason Reed / Reuters
    BP America President Lamar McKay, Transocean President Steven Newman and Halliburton Global Business President Tim Probert are sworn in at a Senate Energy and Natural Resources Committee hearing on Tuesday in Washington.
    BP's low-tech fixes
    May 11: Engineers are deploying technology that has not changed in 20 years in an effort to stop the oil leak. NBC’s Anne Thompson reports.

    WASHINGTON - Executives of the three companies involved in the Gulf oil disaster — BP, Transocean and Halliburton — testified before senators Tuesday and were quick to lay blame elsewhere. In their opening statements, the executives wasted no time in going after each other.
    Transocean, which owned the rig that exploded, suggested work done by subcontractor Halliburton could have been the key factor. Halliburton and BP, meanwhile, said the blowout preventer that failed on Transocean's rig was critical.

    "I can see the liability chase that's going to go on," Sen. Robert Menendez, D-N.J., told the Senate Energy and Natural Resources Committee as the hearing got under way.
    Sen. Lisa Murkowski, R-Alaska, urged the companies not to point fingers, saying that "we are all in this together."

    Separately, the Obama administration announced it will split up the federal agency that oversees offshore drilling as part of its response.

    In Congress, lawmakers asked oil industry giant BP, which operated the Deepwater Horizon drilling rig 40 miles off the Louisiana coast, why its drilling plans discounted the risk that such a catastrophic pipeline rupture would ever happen, and why it assumed that if a leak did occur, the oil would not pose a major threat.
    A top executive of BP, which leased the rig for exploratory drilling, focused on a critical safety device that was supposed to shut off oil flow on the ocean floor in the event of a well blowout but "failed to operate."

    'Top hat'
    May 10: Doug Suttles, BP's chief operating officer, says a smaller containment device should be in place later this week.
    NBC News

    "That was to be the fail-safe in case of an accident," said BP American President Lamar McKay, pointedly noting that the 450-ton blowout preventer — as well as the rig itself — was owned by Transocean Ltd.
    Of the 126 people on the Deepwater Horizon rig when it was engulfed in flames, only seven were BP employees, said McKay.
    But Transocean CEO Steven Newman sought to put responsibility on BP.
    "Offshore oil and gas production projects begin and end with the operator, in this case BP," said Newman. It was BP that prepared the drilling plan and was in charge when the drilling concluded and the crew was preparing to cap the well 5,000 feet beneath the sea, he added.
    To blame the blowout preventers "simply makes no sense" because there is "no reason to believe" that the equipment was not operational before the explosion, Newman argued.
    Newman said it was BP that gave the go-ahead to fill the well pipe with sea water before a final cement cap was installed, reducing the downward pressure.

    The executives said this was a practice that was being used frequently and that BP got approval from the federal Minerals Management Service.

    Newman said there is "no reason to believe" its blowout preventer didn't work and that it might have been clogged by debris shooting up the well.

    Halliburton brought in
    Newman also cited Halliburton Inc., which as a subcontractor was encasing the well pipe in cement before plugging it — a process dictated by BP's drilling plan.
    "The one thing we know with certainty is that on the evening of April 20, there was a sudden, catastrophic failure of the cement, the casing, or both," Newman said. "Therein lies the root cause of this occurrence; without a disastrous failure of one of those elements, the explosion could not have occurred."
    Oil disaster
    View images of the rig explosion and aftermath.
    more photos

    A Halliburton executive, Tim Probert, said the company's work was finished "in accordance with the requirements" set out by BP and with accepted industry practices.
    Pressure tests were conducted after the cementing work was finished to demonstrate well integrity, he said. "The results of the positive test were reviewed by the well owner and the decision was made to proceed with the well program," he added.
    Departing from his prepared remarks, Probert also said that "had the blowout preventer functioned as expected this catastrophe may not have occurred."
    The morning hearing and an upcoming afternoon session before the Senate Environmental and Public Health Committee give lawmakers their first chance to question the executives publicly about the rig fire, attempts to stop the flow of oil and efforts to reduce the damage.
    In Louisiana, the Coast Guard and the Interior Department's Minerals Management Service were beginning two days of hearings on the cause of the explosion. The list of witnesses scheduled to testify includes a Coast Guard search and rescue specialist, crew members from a cargo vessel that was tethered to the Deepwater Horizon rig and two Interior inspectors.
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