A 16-month federal investigation has concluded that BP’s efforts to limit costs on its mile-deep Macondo well in the Gulf of Mexico contributed to the disastrous blowout last year that killed 11 workers and sunk the giant rig Deepwater Horizon.“BP’s cost or time saving decisions without considering contingencies and mitigation were contributing causes of the Macondo blowout,” states the long-awaited report by the Bureau of Ocean Energy Management, Regulation and Enforcement. The report, based on months of hearings and testimony from rig workers and engineers, skewers BP for dozens of mistakes and a failure to appreciate the risks of drilling and then temporarily abandoning the Macondo well.It also finds fault among BP’s contractors, including Transocean, which owned the doomed rig, and Halliburton, which handled the cement job. To the key questions of the disasters — what went wrong, and who’s to blame — the report says, in effect, everything and everyone. BOEMRE conducted its inquiry alongside the Coast Guard, which released its findings earlier this year. Since the blowout, BP, Transocean and Halliburton have traded accusations about which party was most to blame for the disaster. BP and Transocean have released their own reports, which acknowledged mistakes but assigned abundant culpability to the other company.
The report can be read as something of a how-to guide for creating an offshore oil-drilling disaster. The investigators documented a well design that didn’t include enough barriers to oil and gas coming up the central pipe, iffy last-minute changes to the plan, an inadequate cement job, improvised and irregular techniques, and an “overall complacency” aboard the floating rig that may have lulled workers into missing the signals that Macondo was on the verge of erupting. In a brief statement Wednesday, BP highlighted the report’s dispersal of blame: “BP agrees with the report’s core conclusion -- consistent with every other official investigation -- that the Deepwater Horizon accident was the result of multiple causes, involving multiple parties, including Transocean and Halliburton,” the company said.
But the new report emphasizes that BP had responsibility for the well and should have taken more care to ensure the safety of all operations, including those handled by contractors. Communication failures ran rampant. Engineers in Houston did not know what was happening on the rig, and rig workers weren’t informed of all the concerns about the well in Houston.
At the time that I was a management student, I picked up the case of the BP Macondo disaster with a view to understanding what could have gone wrong within the company. My findings were quite interesting. I hate to sound like a broken record but report after report keep on re-affirming one of my key observations; BP was somewhat addicted to 'cost-cutting'. Granted that Halliburton and Transocean have been exposed as relatively culpable over time, this new report serves to teach us - how not to repeat the past. How much of a cost-cutting business is your corporate entity; how do you manage your supply chain and logistics; what is the risk culture? If you have not read them, read the following articles on BP:
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