Profits before safety

May 26, 2010

BP chose a risky well casing because it was cheaper. The magic of the market at work. --PG

BP used riskier method to seal well before blast
NY Times

May 26, 2010


WASHINGTON — Several days before the explosion on the Deepwater Horizon oil rig, BP officials chose, partly for financial reasons, to use a type of casing for the well that the company knew was the riskier of two options, according to a BP document.

If the cement around the casing pipe — used to line the well — did not seal properly, gases could leak all the way to the wellhead, where only a single seal would serve as a barrier.

Using a different type of casing would provide two barriers, according to the document, which was provided to The New York Times by a Congressional investigator.

Workers from the rig and company officials have said that hours before the explosion, gases were leaking through the cement, which had been set in place by the oil services contractor, Halliburton. Investigators have said these leaks were the likely cause of the explosion.

The approach taken by the company was the ”best economic case,” the BP document said. However, it also carried risks — beyond potential gas leaks — of requiring more work and causing delays, it said.

BP’s decision was “without a doubt a riskier way to go,” said Greg McCormack, director of the Petroleum Extension Service at the University of Texas at Austin. Several other engineers agreed with Mr. McCormack’s assessment of the BP document.

Andrew Gowers, a spokesman for BP, said that there was no industry standard for the casing to be used in deepwater wells and that the approach by the Deepwater Horizon had not been unusual. “BP engineers evaluate various factors for each well to determine the most appropriate casing strategy,” he said.

The role of financial and time pressures in the rig blast is one focus of a series of hearings by the Coast Guard and the Minerals Management Service that began Wednesday in Kenner, just outside New Orleans.

Douglas H. Brown, the chief mechanic for the Deepwater Horizon, testified Wednesday that he witnessed a “skirmish” between a BP well site leader and crew members employed by Transocean, the rig’s owner, on the rig the morning of the blast.

Mr. Brown said the disagreement followed BP’s decision to replace heavy drilling fluid with lighter saltwater before the well was sealed with a final cement plug.

“Well, this is how it’s gonna be,” the BP official said, according to Mr. Brown.

Mr. Gowers, the BP spokesman, declined to answer questions about workers’ accusations or about whether cost may have factored into the company’s decision to use the casing system it chose for the Deepwater Horizon.

BP executives will likely face tough questioning about cost-cutting measures on Thursday when they testify before the House Committee on Natural Resources. As more details come to light about the events that led to the explosion, investigators are trying to determine which decisions and incidents — or combination of them — may have led to the accident, which killed 11 workers.

For example, Representative Nick J. Rahall II, the chairman of the committee, said BP executives would face questions Thursday about why they let workers from Schlumberger, a drilling-services contractor, leave the morning of the accident without conducting a special test on the quality of the cement work.

Engineers have described these tests, called cement bond logs, as an important tool for ensuring cement integrity.

The decision about the casings will also come up during the hearings.

Professor McCormack said that while the type of casing that BP chose to use was more expensive in the short term, it was ultimately the more cost-effective and versatile alternative because it would have allowed the company to more easily drill deeper in the same hole if they decide to do so later.

But, the BP records explain, the casing chosen by the company may also cause problems if drilling mud or cement is lost or pushed away from the well into porous rocks as it is pumped.

Federal and company records indicate that that is just what happened, on more than one occasion. The rig lost all of its drilling mud in an incident in March, and in the days immediately before the explosion, records show. The well experienced several other instances of minor losses of drilling fluid and gas kicks, according to interviews with workers from the rig.

The April 20 disagreement between the BP well site leader and Transocean officials is also a growing focus of the investigation.

Investigators said Wednesday that this may have led to critical missteps shortly before the explosion.

At a briefing in Washington, the investigators laid out a chain of events, beginning with an operational error, as the heart of the sequence that led to the disaster.

The findings are preliminary, and come from BP, which owns the lease on the well and has pointed fingers at other companies for the problems on the rig, including Transocean, the rig’s owner.

The BP officials said that rig workers apparently did not pump in enough water to fully replace the buffer liquid between the water and the mud, which stayed in the blowout preventer, the stack of safety valves at the wellhead.

This thick liquid, which is about one-third solid material, may have clogged the pipe that was used for crucial “negative pressure” tests to determine whether the well was properly sealed. The result was a pressure reading of 0 (because it was plugged, not because there was no pressure in the well) and the workers apparently misinterpreted that result as indicating a successful test.

Rig workers declared they were “satisfied” with the tests and started to replace drilling mud in the pipe to the seabed with water. About two hours later, the blowout and explosion occurred.

Evidence began emerging Wednesday that BP officials may have had an incentive to proceed quickly.

A member of the federal panel investigating the cause of the explosion said on Wednesday that BP had hoped before the explosion to use the Deepwater Horizon to drill another well by early March, but was behind schedule.

BP applied to use the Deepwater rig to drill in another oil field by March 8, according to Jason Mathews, a petroleum engineer for the Minerals Management Service.

Based on an estimate of $500,000 per day to drill on the site, the delay of 43 days had cost BP more than $21 million by the day of the explosion on April 20, Mr. Mathews estimated.

A Transocean official — Adrian Rose, the company’s health, safety and environmental manager — confirmed that BP leased the rig for $533,000 per day. He could not confirm where the Deepwater Horizon was planning to go next, but he said it was going to undertake another drill, probably for BP.

Reporting was contributed by Henry Fountain and Tom Zeller Jr. from New York, Robbie Brown from Kenner, La., and Matthew L. Wald in Washington.

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