A Sea in Flames - Carl Safina [98]
“Arrogant and in denial.” That’s how a safety specialist who helped BP investigate its own refineries after the deadly 2005 explosion at its Texas City facility describes the company.
BP had grown into the world’s second-largest oil company, behind only ExxonMobil. The company struck bold deals in shaky places like Angola and Azerbaijan, and drilled high in Alaska and deep in the Gulf of Mexico. It did “the tough stuff that others cannot or choose not to do,” as BP CEO Tony Hayward once boasted.
When Hayward became BP’s chief executive in 2007, he did away with fancy affectations, replacing art in the company’s headquarters with photographs of BP service stations, platforms, and pipelines. A geologist by training, Hayward dispensed with the limousine used by his socially prominent predecessor. “BP makes its money by someone, somewhere, every day putting on boots, coveralls, a hard hat and glasses, and going out and turning valves,” Hayward said in 2009. “And we’d sort of lost track of that.” He vowed to make safety BP’s “No. 1 priority.”
But Hayward’s predecessor, John Browne, had gone after the most expensive and potentially most lucrative ventures. And that record of risk translated to success. BP’s share price more than doubled; its cash dividend tripled. Browne was knighted.
As Browne was reaching, he was also cutting. He outsourced. He fired tens of thousands of employees. Among them, many engineers. He kept rotating managers into new jobs with tough profit targets. The Texas City refinery, for example, had five managers in six years before the blast that killed fifteen people.
Built in 1934, that plant was poorly maintained even before BP acquired it. “We have never seen a site where the notion ‘I could die today’ was so real,” a consulting firm hired to examine the plant wrote two months before the accident. The explosion was “caused by organizational and safety deficiencies at all levels of BP,” the U.S. Chemical Safety Board concluded. The government ultimately found more than 300 safety violations. BP paid $21 million in fines, a record at the time. A year later, 267,000 gallons of oil leaked from BP’s corroded pipes in Prudhoe Bay, Alaska. BP eventually paid more than $20 million in fines and damages.
Revisiting Texas City in 2009, inspectors from the U.S. Occupational Safety and Health Administration found more than 700 safety violations and proposed a record fine of $87.4 million. Most of the penalties, the agency said, resulted from BP’s failure to live up to the previous settlement.
In March 2010, OSHA found 62 violations at BP’s Ohio refinery. An OSHA administrator said, “BP told us they are very serious about safety, but they haven’t translated their words into safe working procedures, and they have difficulty applying the lessons learned.” On May 25, 2010, in Alaska—during the Gulf blowout—BP spilled about 200,000 gallons of oil. It was the Trans-Alaska Pipeline System’s third-largest spill.
“In effect, it appears that BP repeatedly chose risky procedures in order to reduce costs and save time and made minimal efforts to contain the added risk,” wrote Representatives Bart Stupak, Democrat of Michigan, and Henry A. Waxman, Democrat of California. “BP cut corner after corner to save a million dollars here and a few hours there,” Waxman said. “And now the whole Gulf Coast is paying the price.”
BP’s executive overseeing the Gulf response, Bob Dudley, says it’s unfair to blame cultural failings at BP for the string of accidents. “Everyone realized we had to operate safely and reliably, particularly in the U.S., to restore a reputation that was damaged by the accident