BP rivals struggle to explain why plans look so similar

McClatchy NewspapersJune 15, 2010 

WASHINGTON — Top executives from four of the five largest oil companies operating in the U.S. tried Tuesday to show that their own engineering and management practices include safeguards that would prevent them from making the same mistakes that led to BP's runaway deepwater oil well.

The executives, however, struggled to explain to an irate and insistent House of Representatives subcommittee why, as McClatchy reported on June 2, their regional response plans for catastrophic Gulf of Mexico spills are nearly identical to the BP plan — a document that's now widely considered inadequate for containing a gush of oil that's now estimated at 35,000 to 60,000 barrels each day.

Testifying together for the first time since they were questioned about high gasoline prices in 2008, the executives from Shell, Chevron, Exxon Mobil and ConocoPhillips repeatedly said they wouldn't have allowed the same drilling risks as their counterpart at BP, Lamar McKay, who was grilled about the company's progress in capping and cleaning up the spill.

"We would not have drilled the way they did," said Rex Tillerson, the chief executive of Exxon Mobil.

Tillerson, whose corporation is among the biggest in the U.S. and has been rated as the most profitable non-state-owned oil company in the world, was often the most outspoken and opinionated of the five executives. Tillerson told the committee that he had brief conversations with President Barack Obama and several top White House aides about the spill and the response.

He rattled off a list of what Exxon would have done differently than BP, beginning with the well design, the type of pipe the company would have run from the ocean floor deep into the Earth, what sort of cement it would have used and the decisions it would have made about the unusual pressure and test results that its BP counterparts saw.

"What we do know is when you properly design wells for the range of risk anticipated, follow established procedures, build in layers of redundancy, properly inspect and maintain equipment, train operators, conduct tests and drills, and focus on safe operations and risk management, tragic incidents like the one we are witnessing in the Gulf of Mexico today should not occur," Tillerson said.

Shell's Marvin Odum, whose company saw its exploratory drilling plans in Alaska's Arctic waters put on hold by the government after the April 20 rig explosion, told the committee that his company has reviewed its safety practices following the Gulf accident.

Their reassurances rang hollow to the chairman of the energy and environment subcommittee of the House Energy and Commerce Committee, Rep. Ed Markey, D-Mass., who focused on the similarities of the response plans.

Some of the "cookie cutter" response plans even mention walruses, Markey said, a marine mammal that he pointed out hasn't lived in the Gulf of Mexico for 3 million years.

"The only technology you seem to be relying on is a Xerox machine to put together your response plans," Markey said.

"Obviously, it is embarrassing," acknowledged Jim Mulva, the chairman and chief executive officer of Conoco Phillips.

McClatchy reported that plans for 31 deepwater exploratory wells that are now subject to a moratorium mimicked those of BP's. They were so similar to BP's that the Minerals Management Service recently asked the companies to resubmit them.

There was one notable difference in the plans, said Rep. Bart Stupak, D-Mich. Exxon's response plan included a public relations response plan based on its experience with the 1989 Exxon Valdez tanker spill in Alaska's Prince William Sound — but at 40 pages, it's longer than what company devotes to the cleaning up a spill, Stupak said.

"It could be said that BP is the one bad apple in the bunch," Stupak said. "But unfortunately, they appear to have plenty of company. Exxon and the other oil companies are just as unprepared to respond to a major oil spill in the Gulf as BP."

On paper, the plans "might seem reassuring, but reality shows you can't prevent the oil from reaching the Gulf shores," Stupak said.

How, Stupak asked Exxon's Tillerson, would the company handle a 160,000-barrel a day spill — its worst-case scenario — when BP can't handle one that's now estimated at 35,000 to 60,000 barrels each day?

"We are not well-equipped to handle them," Tillerson said. "There will be impacts, as we are seeing. And we've never represented anything different than that."

"And that's why the emphasis is always on preventing these things from occurring because, when they happen, we're not very well-equipped to deal with them," Tillerson said. "And that's just a fact of the enormity of what we're dealing with."

Republicans on the committee said the hearing should have just one focus: how to stop the leak and contain the spill. Many of the panel's Republicans said they feared the hearing would be hijacked for political ends — including pushing climate change legislation.

Some, such as Rep. Michael Burgess, R-Texas, urged the Obama administration to avoid any "knee-jerk" reactions on energy policy in the wake of the spill and asked for the moratorium on new deepwater drilling to be relaxed, a request echoed by the oil companies.

"In some ways, this committee undermines its own credibility when it capitalizes on a tragedy — and this is a tragedy, 11 lives were lost — when we capitalize on a tragedy to push forward a political agenda," Burgess said.

(Lesley Clark and Reid Davenport contributed to this article.)

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