Unflappable before lawmakers choking back their anger, BP’s Chief Executive Officer Tony Hayward responded to questions from the members of the House Committee on Energy and Commerce with the equivalent of rank, name and serial number.
Yes, Hayward said, when he was elevated to the oil conglomerate’s top slot, he was committed to safety, and no, he cannot find fault with the decisions made on the Deepwater Horizon—- that will have to wait until investigations – both the one commissioned by BP and those by the US government are complete.
In Law & Order terms, Hayward was a hostile witness. Or, as Rep. Henry A. Waxman, the chairman of the Energy Committee put it: “I’m just amazed at this testimony . . . you’re kicking the can down the road like you have nothing to do with this company.”
The Deepwater Horizon first began leaking oil April 20. Congressional investigations have honed in on three key elements that made the well particularly risky: the choice to use six centralizers, rather than the recommended 21 which would make the well more stable; the decision to use a single ‘long string’ rather than a ‘tie back” method which would add an additional layer of security should an accident occur; and the failure to test the cement surrounding the well.
The most recent estimates are that between 35,000 to 60,000 barrels may be rushing into the Gulf on a daily basis. BP estimates that they will be able to capture 40,000 to 50,000 barrels a day by the end of June and 60,000 to 80,000 by the end of July.
In addition to threatening wildlife, the financial cost is also of grave concern. several Louisiana state agencies requested an initial $300 million from BP to provide “critical resources” to mitigate immediate impacts on businesses and individuals affected by the spill. Commercial and recreational fishing and related industries, when combined with other economic outputs, have a total annual economic effect of nearly $4 billion in the Louisiana, according to a March 29 news release.
A report by University of Central Florida economist Sean Snaith states that 195,000 Floridians could lose their jobs and the state could lose $10.9 billion in spending due to the spill.
The fusillade of questions began with a statement by Rep. Bart Stupak (D-Michigan), who said he “wasn’t surprised when we heard about the explosion in the Gulf and learned BP was part of it.”
“Did BP’s leadership manage the risk at this well?” Stupak asked.
Hayward responded by summarizing how, in the aftermath of two environmental disasters, he implemented a culture of safety upon being named named chief executive in 2007. Those incidents included an explosion at BP’s Texas City Refinery in 2005, which killed 15 workers and injured 170 others, and a massive oil spill at the company’s Prudhoe Bay operations on Alaska’s Northing Slope a year later. In October 2007, BP pleaded guilty to a felony violation of the Clean Air Act in the Texas City case and paid a $50 million. The company also pleaded guilty to a criminal misdemeanor Clean Water Act violation for the Alaska oil spill and paid a $20 million fine.
Stupak would not be derailed and the two collided, with the congressman asking questions, and frustrated with sidestepping answers, cutting the CEO’s answers short, only to issue another question in its place, and when that failed to elicit what he felt an adequate response, to issue another question. For Stupak, the main issue was accountability. Who, Stupak asked, should bear the blame?
“You were an exploration manager with BP . . . you hold a Ph.D. from the University of Edinburgh . . . are you trying to tell me that you have not reached a conclusion that BP really cut corners here?” he asked.
Hayward responded, his face impassive, “It’s really too early to tell.”
Rep. Michael C. Burgess (R-Texas) followed Stupak’s line of questioning, asking about a decision to use six centralizers (a stabilizing element for wells) rather than 21. Hayward maintained his cool demeanor, answering, “I wasn’t part of the decision-making for this well.”
The issue of Hayward’s understanding of Deepwater Horizon’s progress before the April 20 explosion was raised, with congressmen repeatedly asking why the company decided to bypass measures such as cement tests or ignored recommendations to use a “tieback” rather than a single “long string,” which BP’s internal documents and the congressional panel said would have provided an additional layer of security in the event of an accident.
Hayward said he was “not prepared to say what may or may not have made a difference until investigations” have concluded.
Burgess then asked Hayward about the omission of a cement stress test.
“I am not a cement engineer,” Hayward said in response to the query.
Lawmakers also tried to pin down specifics, with little luck. In addition to citing internal BP documents indicated concern for mounting costs and an expanding timeline, committee members asked if BP bypassed safety considerations to keep the Macondo well development on track and costs down.
Committee members, citing recent testimony from oil industry officials from ExxonMobil and Chevron, who criticized BP’s execution of the Macondo well, also asked Hayward why BP would employ practices below industry standards.
When Rep. John Sullivan (R-Oklahoma) asked whether expedience overtook safety concerns, Hayward said it was too early to tell.
“I believe we should wait . . . when the investigations are completed, we’ll make the judgement,” Hayward said.
Even an hourlong recess failed to dampen the committee member’s ire.
Rep. Diana DeGette (D-Colorado) pointedly asked, “do you think as CEO of this company was it a mistake not to conduct this cement bond [test]?”
Hayward wouldn’t budge.
“I cannot answer this question . . . I think we need to complete the investigation,” he said.
Rep. Phil Gingrey (R-Georgia) asked Hayward whether he would have made the same decisions the crew aboard the Deepwater Horizon made prior to the explosion.
“I’m not the drilling engineer,” Hayward said. “I’m not qualified to make that statement. “
Rep. Edward Markey (D-PA), desperate for a direct answer from Hayward, asked, “Is today Thursday, yes or no?”
The individual cost of the explosion was also introduced during the session. Rep. Jan Schakowsky (D-Illinois) fanned a liability waiver that she said BP required workers, who are unable to work because of the oil gusher, had to sign before being able to participate in cleanup and containment efforts. The waiver states that BP is not responsible if those individual become ill.
“I know that you said this was an early misstep and that this was just a standard document but this was your first response to the people who were hired . . how could you do that?” Schakowsky asked.
However, not all of the criticism was reserved for the oil giant. In opening statements, as well as in the question-and-answer session, several representatives laid the blame on the Obama administration and the Mineral Management Service (MMS), the agency which oversees deepwater drilling on the outer continental shelf.
Ranking committee member Rep. Joe Barton (R-Texas) said the Obama administration has committed something akin to extortion by forcing BP to place $20 billion into an escrow account. In his opening remarks, Barton apologized to Hayward. Barton said he is “ashamed of what happened in the White House yesterday. I think it is a tragedy . . what I would characterize as a shakedown.”
Rep. Marsha Blackburn (R-Tennessee) was also critical of the Obama administration, saying the White House showed a “lack of effort” in trying to contain the spill.
“The current administration also shares a significant portion of the blame for the oil spill,” she said, adding that MMS “approved inadequate plans and rubberstamped inspection papers provided by the oil company.”
Rep. Gingrey was even more direct in his criticism, asking how it was possible that such a disaster did not occur during the Bush administration’s tenure.
Despite the overall lack of candor from Hayward, he did say containment is still at least two months away.
Relief wells, Hayward said, are the only way to stop the oil from gushing. And they won’t be completed until August.
“I am afraid there are no other options to kill this well,” Hayward said.
Truthout’s Mike Ludwig contributed to this report.
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