Fri, Sep 17, 2010 - Page 6 News List

BP boss defends safety record to MPs

‘UNDERSTANDABLE’ The embattled CEO, whose resignation will take effect on Oct. 1, said that the firm’s safety record was still ‘better than the industry average’


BP chief executive Tony Hayward defended the firm’s safety procedures as British members of parliament (MPs) grilled him over the Gulf of Mexico oil spill on Wednesday, amid reports that BP is on the verge of sealing the well.

Hayward said the spill — the worst environmental catastrophe in US history — was “devastating” to him personally, but denied that there had been any cost-cutting at the energy giant in the run-up to the accident.

However, he did admit to a parliamentary committee that BP was reviewing its risk assessment ­procedures and also its relationship with contractors, blamed by the firm for problems with the rig and well.

“This particular incident is so devastating to me personally because we made enormous progress” on safety measures before the disaster, Hayward told the Energy and Climate Change Committee.

Asked whether BP was still a suitable firm to carry out drilling operations in the North Sea in the wake of the Gulf of Mexico spill, he said BP’s safety record was “better than the industry average.”

He said BP had invested US$14 billion on safety in the three years prior to the blast on the Deepwater Horizon rig in April, which killed 11 people and leaked millions of barrels of oil into the sea.

The well took about three months to cap.

Hayward said the company had not taken fully into account the likely impact of events like the Gulf of Mexico spill because it believed its own safety procedures had made such a disaster impossible.

“The industry had drilled for 20 years in deep water without a blow-out,” he said.

He said BP was now “looking very closely across the company at the low-probability, high-impact risks” that it had previously believed it had “effectively mitigated.”

Hayward — whose resignation after a string of PR gaffes takes effect on Oct. 1 — reiterated the claims in BP’s own report into the disaster released earlier this month that contractors were partly to blame.

Without directly naming rig owner Transocean and contractor Halliburton, which cemented the well, he said: “BP will look very hard at the relationship between the company and contractors in the light of this tragedy.”

He also sought to play down a Financial Times report on Wednesday that BP failed to comply with emergency regulations on oil spills at four out of five of its North Sea installations which were inspected last year.

“I don’t believe that the report this morning points to any fundamental weakness in our North Sea operations,” he said, adding that spills at BP facilities there had dropped by 20 percent in the last two years.

He acknowledged that US anger in the wake of the disaster was “understandable” and refused to be drawn by lawmakers on whether he felt he had been unfairly treated.

“Given the scale of the tragedy and the enormous impact of the disaster, the amount of anger in the US was quite understandable,” he said.

Hayward, 53, faced US lawmakers in June at a bad-tempered hearing.

He announced his resignation the same month and handed over day-to-day management of the crisis in June to Bob Dudley, a US citizen.

In the US on Wednesday, a top official said that BP was on the verge of finishing drilling operations to seal the blown-out Macondo well in the Gulf that had sent the oil gushing into the sea.

The well could be declared permanently a “killed” by Sunday, retired US Coast Guard admiral Thad Allen said.

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