vol 6 issue 7

What went wrong on Deepwater Horizon?

11 July 2011
By Nick Smith
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The Deepwater Horizon oil spill

The Deepwater Horizon disaster was the biggest offshore oil spill in US history

Loren C Steffy

'My biggest regret was that I couldn't get the company to let me interview the engineers who responding to the spill'

Drowning in oil

We read it for you - 'Drowning in oil'

BP's major environmental catastrophe could have been prevented with better management. E&T talks to author Loren C Steffy, whose new book explains what went wrong.

'My book is a cautionary tale for any engineering-intensive company,' says Loren C Steffy. 'It isn't a screed against offshore drilling or the oil industry. I believe offshore drilling must continue. But it has to be done safely.'

Steffy is the author of 'Drowning in Oil', an exhaustively researched, in-depth examination of how the 2010 Deepwater Horizon disaster was directly caused, not by failings in technology, but by a general lack of corporate responsibility and government oversight.

The biggest offshore oil spill in US history, the series of events that led from the blowout became a public relations nightmare for BP. But this was nothing compared with the general state of malaise that was revealed to be embedded in the company's operating principle.

'Drowning in Oil' is a vital work of investigative journalism that casts much-needed light onto the inner workings of an immense corporation, whose attitude to the process of due diligence is called into question time after time.

Deepwater Horizon made the headlines the world over, dominating the broadsheets and rolling news TV stations. For journalists, it was a multi-dimensional story that had everything.

It's often said that engineering stories only make the news for the wrong reasons, but here was a golden opportunity for the media to vent its spleen at Big Business.

It was, in fact, manna from heaven, having two killer ingredients guaranteed to keep it high on the news agenda for weeks on end. First, there was the unfolding environmental catastrophe that would continue to shock the world, while hapless and inefficient corporate bigwigs looked on in impotent dismay.

Second, here at long last was a channel for directing long-sublimated anger at faceless multinationals; the final proof, if proof were needed, that their touchy-feely sustainability manifestos were nothing but 'greenwash'.

The cherry on the bun was that the 'faceless' had a face, in the form of BP chief executive Tony Hayward. Here was a man who seemed to have no instinctive feeling for prevailing public sentiment. Hayward's air of detached disdain for how a leader should behave in a time of crisis caused outrage far beyond the usual environmental activism lobby. A dutiful, and in no way reluctant, press saw to it that sufficient pressure was applied for Hayward's head to roll.

The disaster

On 20 April 2010 a series of explosions rocked Deepwater Horizon, the submersible drilling platform leased by BP, 40 miles off the Louisiana coast in the Gulf of Mexico. As Steffy succinctly puts it: 'The ensuing inferno claimed 11 lives, and it would rage uncontained for two days, until its wreckage sank to a final resting place nearly a mile beneath the waves.'

Although there is a huge environmental story here, and while he accepts that capping the well was the sternest of engineering challenges, what Steffy is interested in is how the disaster took place in the wake of cost-cutting at BP, particularly under the guidance of two former CEOs, John Browne and Tony Hayward. The gaffe-prone Hayward's approach to the crisis – which included taking a holiday to go sailing while the disaster raged – seems to neatly sum up BP's corporate arrogance.

As the business columnist for the Houston Chronicle, Steffy was already tracking BP, having covered the earlier Texas City refinery explosion. 'That put BP squarely on my radar,' Steffy says, indicating his intention to make his book a business title from the start. Explaining its subtitle – 'BP and the reckless pursuit of profit' – the author is asserting his claim that the accident was only part of the wider story: 'I told my editors that it was a symptom of the larger story that involved how BP's culture emphasised profits over safety and maintenance.'

'Drowning in Oil' came together 'very quickly', taking only two months to write. 'I had a big advantage in that I'd covered BP since 2005, and I had a lot of interviews already in my notebook. I had interviewed Tony Hayward about three times previously, and that made the reporting a lot easier.'

Even so, it can't have been an easy task, writing what was inevitably going to be a controversial book under the scrutiny of a damage-control-conscious petrochemical multinational?

'I didn't have a lot of doors slammed in my face. I suspect the folks at BP had a pretty good idea of what the book was going to say. My biggest regret was that I couldn't get the company to let me interview the engineers who worked on responding to the spill. Those folks sacrificed months of their lives. It was a very heroic and dramatic effort, and I think it was an important aspect of the story that's been lost.'

I ask Steffy if, in the course of preparing such an outspoken manuscript about such a powerful organisation, there was ever any doubt in his mind as to whether he should stick his neck out and go to print. Had the book been watered down in any way by over-cautious editors or risk-averse legal people? 'The lawyers didn't remove anything, although we did have some discussions about wording.

'There may have been a few tweaks here or there, but nothing major. I had extensive documents to back up my assertions.'

Long-term effects

Although primarily a business book about an engineering company, rather than an engineering book that happens to be about big business, it simply isn't possible to comment on 'Drowning in Oil' without assessing the impact such a disaster could have on the ecosystem of the Gulf of Mexico.

When pressed for a response on the long-term environmental effect of Deepwater Horizon, Steffy finds it difficult to make accurate predictions.

'The Gulf is resilient, and it has already bounced back better than many scientists had hoped. And steps taken by BP and the state and federal government did help reduce the environmental impact.'

He points out that the leak occurred far from the shore, and the water is warm, factors that have helped to contain the oil and to break it down. But, as he says, there remains a vast quantity of oil settled on the seafloor. 'Fishermen are also concerned about the amount of chemical dispersants used and what effect they may have on sea lifecycles. It will probably be several more years before we really know the full impact.'

Steffy believes that oil exploration can be done responsibly and safely, but 'the industry and the public at large can't afford to lose sight of the huge costs and consequences that can result from not taking the proper cautions'.

So, no regrets? 'I never wondered why I was doing this. It's an important story, and I'm glad I had a chance to tell it.' *

Drowning in Oil, by Loren C Steffy is published by McGraw-Hill, £19.99

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We read it for you: 'Drowning in Oil'

'Drowning in Oil' sets the Deepwater Horizon disaster into the broader context of BP's troubled history, illustrating how what the author calls 'the flawed culture at the core of the company' led to a series of operating failures.

The oil leak that resulted from the accident was the largest offshore environmental disaster in US history. By the time the well was finally capped, the amount of oil released was more than five times the size of the Exxon Valdez spill.

The book documents BP's failure to learn the lessons of previous disasters. The author contests that the company didn't make the fundamental changes it needed to make, continuing to champion a culture of doing more with less. Top executives failed to see how problems in one division could manifest themselves in another. The book concludes that key decision-makers at BP didn't recognise the potential for the accident, or do enough to prevent it.

Hayward's last days at BP

The end of Hayward's career began with yet another mis-step on his part. Despite having vowed to stay in the Gulf until the crisis was resolved, Hayward decided to take a little time off. He'd barely been home since April, and he decided to spend a Saturday attending a yacht race around England's Isle of Wight, in which his 52ft sailboat Bob was participating. The Round the Island Race is one of the world's biggest, with more than 1,700 boats competing on a course that spans 50 nautical miles. A photographer snapped a grainy picture of Hayward in the cockpit of the yacht, the port-side sheet ' the line that controls the direction of the foresail ' gripped firmly in his left hand. He wore dark glasses and a black baseball cap pulled down over his face. The collar of his windbreaker was flipped up straight, covering his ears, as if he were seeking anonymity at one of the world's most exclusive yachting events. BP's public relations team immediately went into damage control, saying that Hayward would be back at work fighting the runaway well in the Gulf of Mexico Monday morning. 'He's spending a few hours with his family on a weekend. I'm sure everyone would understand that,' a spokesman said. No one did.

Three days later BP announced that Hayward would return to London and focus on running the rest of BP. Bob Dudley, the former Amoco executive who'd grown up in Mississippi, had already been tapped earlier in the month to take over the spill cleanup. Now, it was clear BP wanted to distance Hayward from the spill and shift the focus on to an American executive.

From 'Drowning in Oil' by Loren C Steffy

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