Weather Delay, Internal Report Add to BP's Mounting Woes

(Aug. 30) -- Heavy seas forced a two- to three-day delay in the planned removal today of the temporary cap on BP's blown-out Gulf of Mexico oil well. The latest setback comes as a new internal investigation raises serious questions about BP's decision-making leading up to the explosion that killed 11 workers and unleashed the world's largest maritime oil spill.

BP is also under fire in Texas over a massive 40-day release of toxic fumes from a refinery in Texas City, near Galveston, two weeks before the gulf disaster. The leak allegedly made scores of local residents ill, sparked a class-action lawsuit on behalf of refinery workers and prompted a legal challenge from the Texas attorney general's office over the oil giant's handling and public notification of the environmental breach.

The lawsuits accuse BP of putting profits and public relations ahead of the safety of workers and the public.

BP's U.S. press office declined comment on the internal report on the gulf disaster but rejected allegations that it did anything wrong in its handling of the Texas City leak. It said that the company followed required reporting procedures and that its monitoring stations recorded no elevated readings during the leak.

"BP does not believe there is any basis to pay claims in connection with this event. BP is not taking or paying such claims," it said in a statement.

The internal investigation into the Deepwater Horizon gulf disaster reportedly assigns some of the blame for the blowout to BP managers who misinterpreted pressure data April 20 and thus missed evidence that a blowout was imminent, according to a report by Bloomberg News, citing an unidentified source familiar with the report.

The internal report is likely to further roil efforts to figure out who did what in the events leading up to the disaster, with BP trying to put some of the blame on Halliburton Co., the contractor that did the cement work on the well, and Transocean Ltd., which owned the Deepwater Horizon rig. A federal investigative panel has requested a copy of the BP report, prepared by a team of investigators led by BP's head of safety and operations, Mark Bly.

BP managers gave the OK on April 20 for workers to replace heavy drilling fluid in the well with lighter seawater, which let natural gas that had been leaking into the well blast up the pipe to the rig. The resulting explosion killed 11 workers and eventually toppled the rig itself, causing the rupture that sent nearly 5 million barrels of crude oil into the gulf.

But the 200-page Bly report found that local managers on the rig and in Houston failed to properly interpret pressure readings that indicated a likely blowout if the drilling fluid was replaced. The report also concludes that Transocean bears some of the responsibility, though Bloomberg didn't specify Transocean's actions.

More details of what led to the blowout will likely come once crews recover the "blowout preventer" that failed. But those efforts were delayed today when heavy seas forced a postponement in plans to remove the temporary cap on the well and recover the unit. It was unclear when conditions would improve sufficiently to let the operation proceed.

Adm. Thad Allen, the national incident commander, told reporters this morning that local weather conditions around the mouth of the Mississippi River were creating seas of six to eight feet, which he said would create too much bobbing and weaving as the equipment is raised from the seabed.

Weather conditions, which are unrelated to seasonal hurricane activity in the Atlantic, aren't likely to improve soon.

"Everything is ready to go; we just have safety parameters that have been exceeded," Allen said. "It's reasonable to look at a two- to three-day delay."

In Texas, BP's Texas City refinery suffered a problem with an "ultracracker" unit in early April that led to a 40-day release of 538,000 pounds of benzene, sulfur dioxide, hydrogen sulfide and other compounds. It's the same unit that exploded in March 2005, killing 15 workers and injuring 170 others. BP officials have said they didn't believe the leak was a significant problem because technicians had diverted most of the pollutants to a separate stack where they were burned.

But BP Products North America agreed earlier this month to pay $50.6 million to settle some complaints by the federal Occupational Safety and Health Administration regarding conditions at the refinery. BP also agreed to spend $500 million over the next six years on safety monitoring and improved practices. BP continues to contest other OSHA citations growing out of the explosion.