Bloomberg News

U.S. Wildcat Culture Risks Macondo Oil Spill Repeat, Graham Says

October 10, 2011

Oct. 10 (Bloomberg) -- The U.S. risks a repeat of the 2010 Macondo oil spill as its “wildcat culture” fails to put a premium on safety and security, the co-chairman of the National Commission on the BP Deepwater Horizon Oil Spill said.

“U.S. oil and gas culture is the culture of the wildcat that’s been transferred offshore,” Bob Graham said today in an interview at an oil conference in Abu Dhabi. “The Gulf of Mexico had a culture of complacency. For every one fatality in the North Sea, there were four in the Gulf of Mexico.”

The 2010 blowout of BP Plc’s Macondo well, which killed 11 workers, destroyed Transocean Ltd.’s $365 million Deepwater Horizon rig and spewed crude for 87 days. Fishing grounds covering thousands of square miles were closed and deepwater exploratory drilling was halted after the well blew out about 40 miles (64 kilometers) off the Louisiana coast. The presidential commission probing the spill released its report in January.

The industry has taken a defensive position, seeking to install a safety entity within the American Petroleum Institute, a trade association made up of U.S. oil and gas companies, Graham said. He doubts the credibility of a safety body that is being run by the same group that advocates oil and gas drilling.

Better Regulated

The North Sea is better regulated, said Graham, a former Democratic U.S. senator and Florida governor. The U.S. should follow the North Sea’s “safety case” approach, which asks operators to identify all the risks associated with drilling in a specific area, rather than the prescriptive approach taken in the U.S.

Norway has some of the best regulations after spills in the North Sea, including Ekofisk in 1977, according to Liane Smith, director at well integrity company Intetech Ltd. The Cullen report, produced after the 1988 explosion at the Piper Alpha platform in the U.K. North Sea in which 167 people died, strengthened the power of the U.K. Health and Safety Executive, a government body staffed from the oil and gas industry that is respected by local operators, Smith said.

“In the North Sea, anyone can stop an operation,” Smith said in an interview at the same conference. “You can’t have a situation where operators have to do things they don’t feel are safe. It costs money to stop but it’s worth it.”

--Editors: Stephen Cunningham, Amanda Jordan.

To contact the reporter on this story: Ayesha Daya at adaya1@bloomberg.net;

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net


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