The safety regulator of the U.K. offshore oil and gas industry has ordered BP PLC (BP) to fix significant safety lapses on three North Sea rigs, according to documents posted on the regulator's web site Wednesday.
The safety regulator of the
U.K.
offshore oil and gas industry has ordered BP PLC (BP) to fix significant safety
lapses on three
North Sea
rigs, according to documents
posted on the regulator's web site Wednesday.
The publication of the order comes as BP has vowed to transform itself into the
safest offshore operator in the wake of the Deepwater Horizon explosion and oil
spill last year, and is the latest in a series of setbacks to the hoped-for
recovery in BP's reputation and profitability.
Tuesday, a
U.K.
court
issued an injunction that halted a major Arctic oil exploration and share swap
deal with
Russia
's OAO
Rosneft (ROSN.RS), at the request of BP's partners in its other Russian
venture, TNK-BP. It also emerged that the U.S. Commodity Futures Trading
Commission plans to charge BP over alleged manipulation of natural gas prices.
BP Chief Executive Bob Dudley said Tuesday that following the
Gulf
of Mexico
disaster the company doesn't hesitate to shut down
operations it deems to be unsafe, and has done so in
Alaska
and
the
North Sea
in recent months.
However, the U.K. Health and Safety Executive, or HSE, identified a case in
September where BP was aware of dangerous corrosion on a piece of equipment on
a
North Sea
platform, but continued to operate it until it
failed catastrophically. The HSE didn't say whether anyone was harmed in the
incident.
That event came several months after April's Deepwater Horizon explosion, but
before
Dudley
became BP CEO Oct. 1.
Dudley
has
started a major shake-up of BP's approach to managing risk, creating an
independent safety organization whose head reports directly to him.
Mark Bly, head of the new safety organization, said Tuesday improvements are
already "rippling through the company. We are building the foundation to a
much different approach to safety and operational risks."
The HSE issued BP the improvement notice Nov. 25. This isn't the harshest
sanction available to the regulator, which has the power to immediately shut
down operations where it finds the most serious violations.
Neither is BP the only
North Sea
operator to be sanctioned by the HSE. The regulator issued 17 improvement
notices to 10 different companies in second half 2010, and one prohibition
notice which shut down a platform operated by Canadian Natural Resources Ltd. (CNQ.T)
in August.
The first HSE charge is that BP neglected maintenance of a heating line on the
Schiehallion offshore platform.
"You were aware of severe wall thinning on the heating medium line from
Sept. 21, 2010
, but no operational risk
assessment was carried out to determine whether this was safe for continued
operation or should be shut down," the notice said. "The line failed
catastrophically on
Sept.
24, 2010
, discharging approximately 27 [metric tons] of fluid at 123 degrees
centigrade."
The HSE also said BP had failed to adequately address the risk to its workers
from an oil leak in a turbine enclosure on the Clair platform and had
considered running the ETAP platform without sufficient lifeboats.
"We have already taken a number of actions to improve this aspect of risk
management and will ensure all lessons are shared and implemented," said
BP in a statement. "BP's safety performance in the
North
Sea
during 2010 improved considerably."
The regulator gave BP until
May
31, 2011
to fix the problems.
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