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What to expect from BP

May 20, 2010, 9:00 am

Originally posted in the Independent News - May 20, 2010

Past Experiences With BP May Point To Future Issues

While Northwest Florida prepared for the over five million gallons of BP crude oil set to contaminate its beaches and waterways, the IN took a break from the endless series of press conferences by visiting politicians from our state and federal governments to talk with experts who have investigated and dealt with British Petroleum in other disasters.

The IN interviewed Greg Palast, investigative reporter for BBC television and “The Guardian” newspaper, who investigated the Exxon Valdez incident for the Alaskan natives. That 1989 environmental disaster spilled nearly 11 million gallons of crude oil into Prince William Sound–a volume that the Deepwater Horizon’s spill may have already exceeded.

IN wanted to get a handle on what the greater Pensacola area can truly expect from British Petroleum with this Gulf oil spill. The paper also interviewed attorney Brent Coon, who battled BP over a refinery explosion in Texas that killed 15 people and injured 170 workers and residents.

BP’S ROLE IN VALDEZ CLEANUP

Palast told the IN that the Exxon Valdez and Deepwater Horizon oil spills have one common denominator: British Petroleum.

“The most important thing that people do not recognize is that my investigations over the past 20 years have led me to see that the party most responsible for the destruction in Alaska was not Exxon,” said Palast in a telephone interview. “It was British Petroleum, and that’s vital in understanding what’s going on in the Gulf.”

Palast stated that Pensacola and the Gulf Coast are not only seeing a repeat of what Exxon did in 1989 in Prince William Sound, but we are also seeing a repeat of what British Petroleum did when the tanker hit Bligh Reef and nearly destroyed the area’s ecosystem.

“In the case of Deepwater Horizon, British Petroleum had its name on the well, even though it’s just a majority partner,” Palast explained. “They have Mitsui and other stakeholders in the consortium.

“In Alaska, it’s the same thing. The Alaska pipeline and shipping system is called Alyeska. It is also, like the Deepwater Horizon well, owned by consortium majority owned by BP. It was BP’s responsibility, not Exxon’s, to contain and clean up the Valdez spill. The same is true of this current oil spill.”

Palast said that BP had its name on the Deepwater Horizon well because the global oil company was boosting its stock by calling themselves the “deepwater leaders.”

“They wanted to put their name on that well and so they are getting the full shtick for this blow out, not Mitsui.”

Palast also explained BP’s role in the Valdez disaster.

“The whole game with any oil spill is containment. You never would have heard of the Valdez spill if BP had put out the containment boom right away and gotten the skimmers and containment barge there.

“BP, through its Alyeska operation, was responsible for having that stuff out there. But the story gets worse. The Exxon Valdez hit at Bligh Reef. British Petroleum/Alyeska had certified in writing that it had boom and safety equipment on nearby Bligh Island. They also certified that they had emergency crews ready to go.”

BP GAMBLED ON NO SPILLS

“Bligh Island is next to the Chugach native village,” Palast said. “The Chugach natives had been hired by BP to man fulltime safety crews, which you have to have…similar to a fire department. But they had fired all the natives to save money.”

BP saved money and gambled that nothing would happen in Prince William Sound.

“It’s all about penny-pinching with BP,” Palast said. “They never put out all the boom that they say they put out. Of course, they were thinking, ‘Who’s going to check in the goddamn Prince William Sound?’

“When that tanker hit that reef, the natives should have been on contract and on call–they had helicopters and everything to set that boom right out there, and surround the ship. They were also supposed to have a containment barge that was to be onsite within five hours.

“No tanker is to leave port without an emergency barge at the ready.”

However, the BP/Alyeska barge was actually in dry dock and under ice, according to Palast. The natives saw the accident happen.

“The natives actually saw the tanker hit the reef,” Palast said. “It may be the middle of nowhere, but it’s not the middle of nowhere to natives. It was a clear night and they actually watched the ship turn into the reef.

“They all thought, ‘This is some kind of test, right?’ They thought it was some weird test by the company. Had they still been on emergency response and had their equipment, they could have shot right out there and surrounded the damn thing pronto. Then you would have had the barge come in within a couple hours and it would have sucked the oil out of the boom area. This would have been a story for a day or two and that would have been the end of the game.”

Palast said that BP wasn’t just negligent. “They certified that they had the containment barge. They certified that they had the emergency crew. They certified that they had the containment boom and safety equipment on Bligh. It was all completely fraudulent baloney.”

NO LESSONS LEARNED FROM VALDEZ

According to Palast, BP didn’t learn anything from the Valdez accident, except that cutting safety procedures improves profits and stock values.

“BP got away with this because they settled right off for basically the amount of the insurance fund, which I think was for about $125 million. Between their own insurance, the spill insurance fund and their partners on which they could offload half, BP got away virtually free.

“I think the fact that they got off basically free in Alaska has stuck with them. They decided it was dirt cheap. The fact is, the cost of preparing for containment is really expensive. You have to have enough boom, have it ready and have a crew ready to deploy it rapidly.”

Palast pointed out that BP CEO Tony Hayward has made a big deal that they were changing their culture to safety.

“His idea of changing the culture to safety is to have big meetings with management consultants and say, ‘We want a green image–we’re even painting all our gas stations green.’”

However, Hayward is deeply cutting the budgets for operations.

“Last year, he announced that beyond the big cuts that Lord Browne (Hayward’s predecessor) had planned, he cut an extra billion dollars. And the stocks shot up.”

This puzzles Palast.

“You tell me, where did they cut? BP’s output has been growing substantially every year. The growth is based on more expensive, cutting-edge drilling like the Deepwater Horizon well.

“How do you cut your budget a billion dollars when you’re expanding your exploration in the most difficult, dangerous areas?”

NOBODY KNOWS MORE ABOUT BP

After fighting the oil giant for four years, Texas attorney Brent Coon claims, “Nobody knows more about BP than we do.”

Coon heads Brent Coon & Associates, a Beaumont, Texas law firm with 12 offices across the country. His firm has filed a lawsuit on behalf of a rig worker injured in the April 20 explosion at the Deepwater Horizon well in the Gulf of Mexico.

The trial attorney led the legal team that brought cases against BP for the Texas City Refinery fire in March 2005 that killed 15 workers, injured 170 plant workers and the residents of nearby neighborhoods, and rocked buildings 10 miles away.

Coon represented Eva Rowe, who lost both of her parents in the tragic explosion, in a $1.2 billion lawsuit against British Petroleum. Rowe eventually settled her lawsuit against the oil giant for an undisclosed amount, and $32 million in donations for education, training and charities such as St. Jude’s Children’s Research Hospital in Memphis, Tenn.

“BP has a definite strategy,” Coon said. “They anticipate events and have a book that tells them what to do if this or that happens.

“In our case involving the Texas City Refinery, the judge allowed us to have all their communication strategies. We saw how they broke up into teams to deal with all communications, public relations and legal aspects of the case.”

In the Texas City explosion, BP officials contended that the facility was exceptionally safe and that the prior events that occurred were unrelated to the larger explosions, despite the evidence of lackadaisical safety practices and numerous resulting accidents. The blast was the third fatal accident within a year at the Texas City plant–the third largest refinery in the United States.

The Occupational Safety and Health Administration (OSHA) didn’t agree with BP and fined the company in September 2005 a record $21.3 million, and charged it with 300 health and safety violations in the explosion.

Two years later, BP agreed to resolve a criminal investigation into the explosion by pleading guilty to a felony violation of the Clean Air Act, paying a $50 million fine, serving three years of probation, and complying with the terms of the OSHA settlement.

This past September, BP missed its deadline to make certain safety upgrades at the Texas City Refinery that were agreed upon under the 2005 settlement. OSHA proposes to fine BP $87 million for the alleged settlement violations.

BP BLUEPRINT FOR PENSACOLA

According to Coon, BP does follow a blueprint with disasters like the Texas City Refinery and the Deepwater Horizon well:

1.) Identify the leaders in the community and build relationships with them. “They may start with the mayor or county commissioner,” Coon said. “The larger the problem, the higher they will move up the political chain. They will reach out to governors, even the White House.”

In Pensacola, we have seen leaders already side with BP officials. Before Florida Gov. Charlie Crist arrived on Saturday, May 1 for a briefing with the Coast Guard, BP, Florida Department of Environmental Protection and local officials, I overheard DEP Secretary Michael Sole tell one BP official, “I will take care of you,” minutes before I was escorted out of the room by Sole’s communications director.

When Gov. Crist returned to Pensacola on Tuesday, May 4, Florida’s Emergency Management Director David Halstead told the local officials that “BP is a great partner.”

2.) Have scripted communications to the public that mitigate the extent of the damages during the initial stages and then gradually release more severe information.

There is rarely anyone from BP with authority or technical knowledge attending the community meetings. The BP spokespeople are usually well-dressed women who sincerely deliver a set series of talking points:

BP is saddened by the tragedy at its Deepwater Horizon well.

BP has its best minds working on stopping the underwater leaks.

BP will protect our shores, our citizens.

BP will be responsible for all costs.

If a specific technical question is asked about the oil rig operations, the spill or BP’s cleanup strategy, the standard response of Liz Castro, BP’s director of civic affairs, has been, “I’m not a technical person.”

Questions about claims, even those of Florida’s Chief Financial Officer, Alex Sink, are referred to BP’s 1-800 hotline.

Also, the estimates on the amount of crude oil spewing into the Gulf of Mexico grew in just two days from the original estimate of 1,000 barrels a day to 5,000 barrels a day. The latest estimate is the volume may be as high as 25,000 barrels daily. At a May 10 press conference in Houston, BP officials admitted that they don’t how much crude oil is pouring into the Gulf.

3.) “It’s all about damage control,” said Coon. “They have people assigned to determine how BP will be impacted by the event: do we lose the right to business in the area? What are the potential monetary damages?”

BP CEO Tony Hayward told NPR on May 3 that his company is fully responsible for the cleanup and any “legitimate” claims from the oil spill. However, BP officials have tried to separate themselves from the liabilities–and inevitable fines–attached to the explosion and deaths at the Deepwater Horizon drilling platform.

“The rig was Transocean’s…the riser was Transocean’s,” Daren Beaudo, a BP representative at the company’s Unified Command in Mobile, Ala. told IN the same day as the Hayward interview. “BP was not conducting the drilling.”

4.) They will identify those most likely to sue BP and try to negotiate settlements as quickly as possible without involving attorneys. According to Coon, in the Texas City case, BP went to neighborhoods around the refinery and tried to settle quickly.

BP has hired 700 charter and commercial fishing boats to help with the oil spill cleanup in Louisiana, Mississippi, Alabama and Florida. The boats were chartered for fees up to $5,000, which sounds great for fishermen who may not be able to work for years.

There was initially one catch. The boat owners had to sign waivers that held BP harmless and that could possibly be used by the oil company to avoid any future lawsuits by the boat owners and their deckhands.

The Attorneys General of both Alabama and Florida got wind of the waivers and issued warnings to locals to not sign away their rights.

On Monday, May 3, BP began to back off requiring the waivers, claiming they were mistakenly included in the packets and were just standard forms used by the company. The IN got a copy of the Voluntary Waiver and Release Forms. They weren’t generic forms, but specifically cited the oil spill in the Gulf of Mexico and even gave the date of the event, April 20, 2010.

The IN published these four aspects on the BP Blueprint on Rick’s Blog (ricksblog.biz) last week. Since then, readers and several public officials have remarked on how closely British Petroleum is following them here in Northwest Florida.

PREDICTIONS

Based upon these interviews with Palast and Coon, it appears Northwest Florida will see more public relations “spin,” ever-worsening revelations on the actual facts regarding the Deepwater Horizon operations, the explosion and the impact of the BP oil spill, and pressure to quickly settle any and all claims before people truly understand the extent of the economic, health and environmental damages.

Northwest Florida is in for a long, hot summer, unlike any the area has ever experienced.

Brent Coon discussing Oil Spill Settlement
BCA Oil Spill Refer Co Workers

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