BP’s failures are symptomatic of a wider problem

How safe are energy companies? And how well prepared are they in case of an emergency?

These questions will take centre stage again today as BP’s outgoing chief executive Tony Hayward appears in front of the UK’s energy select committee.

In the months after the explosion on the Deepwater Horizon in the Gulf of Mexico, the US regulatory agency overseeing the offshore industry was severely criticised for its lax inspection regime. Several serious failures on the Deepwater Horizon were found after the explosion, including dead batteries and insufficiently strong devices that could have shut off oil flow in case of an explosion.

These findings prompted us to review inspection records of regulatory bodies responsible for the UK offshore industry and determine whether similar failings were being found in the North Sea.

“There is no doubt that operating assets in the North Sea for extended periods provides many challenges,” a BP spokesman wrote after being presented with evidence of maintenance issues aboard the Magnus and other safety-critical lapses cited in inspection records by the Health and Safety Executive. Nobody would dispute this. Nor should BP be singled out.

However, there should be an open dialogue about safety issues, beyond the communications between the regulatory bodies and the companies and its workforce. While a small accident on a platform may only affect the workers on the installation, a repeat of a disaster as it occurred in the Gulf of Mexico in April would not just affect the companies, but onshore communities.

Several inspections by the Health and Safety Executive during the past year have pointed to a variety of potentially safety-critical issues aboard installations. Two of them point to communication problems.

  • In one of them, the inspector describes a confused chain of command, with contractors and BP employees being unsure of who would make decisions in the event of a “well control incident”. The inspector calls for “clear instructions regarding the role of each contractor in the event of an emergency.”

In BP’s subsequent correspondence with the regulator, the company explained that while it considered itself to be compliant with the regulation, it had consulted with contractors and provided written instructions clarifying roles.

  • Another inspection record discusses the failure of communication systems on the Andrew platform, an issue which the inspector suggests “may be replicated on other installations” such that most external communications systems could be made unavailable during an emergency. After a power outage the communications systems, including a satellite phone stopped working, leaving the installation with a lack of effective means of communication, apart from handheld radios.

BP underlines that the power outage was not an emergency situation and the platform was not operational at the time. While BP says it continued to be in communication with the neighbouring installation and with its onshore Emergency Response Centre, steps have nonetheless been taken to ensure such an incident could not occur again.

“To ensure that we do not have a repeat of the incident, there is now a back up circuit board held on the platform, identical to the one that caused the initial problem,  system and an additional backup satellite phone is in place.  Furthermore, an additional high specification broadband satellite system is currently being installed on the platform which will be operational by the end of the year,” a BP spokesperson explained, adding that weekly checks of emergency communications are carried out on all BP installations.

HSE executives caution that these inspection records only provide a snapshot and that the regulator and companies engage in an ongoing dialogue.

Most of the citations noted by HSE inspectors on BP installations are not enforcement notices. But while a dead battery on the Deepwater Horizon may not have been worth an enforcement notice equivalent, it was nonetheless symptomatic of a wider problem.

BP, which operates 33 platforms in the North Sea, has received over 40 notices by HSE in the past ten years. During that time it has only been fined £50,000 for breaches relating to their offshore facilities in the North Sea, according to HSE data on prosecutions. Meanwhile Shell has had nearly 60 notices relating to issues in the North Sea, and has been fined over £1m in the same time period, mainly for offences between 2000 and 2005. Shell said it had addressed all the findings in HSE inspection records.

Cynthia O’Murchu is an investigative reporter for the FT