Embattled BP boss Tony Hayward defended the firm’s safety record tonight as he was grilled by a committee of MPs over the implications of the Gulf of Mexico oil spill.
The outgoing BP chief executive said recent criticisms had not exposed “any fundamental weakness” in the company’s operations in UK waters.
Mr Hayward spoke out as he was quizzed by the Energy and Climate Change Committee, which is investigating the implications of the Gulf of Mexico oil spill for offshore drilling in the UK.
In his first UK appearance since the Deepwater Horizon explosion, he said the disaster had been personally “devastating” because he had made safety the firm’s top priority.
But he was forced to explain why inspections on BP’s North Sea installations found some did not comply with guidelines over regular training for operators on how to respond to an incident.
Department of Energy and Climate Change (DECC) inspectors also found the firm had not conducted oil spill exercises properly at some of its offshore sites.
Mr Hayward told the MPs: “We have a very strong track record in the North Sea. It is better than the industry average. We have seen major improvements in the course of the last two years.”
DECC had publicly said that “nothing that they identified compromised the overall integrity of the installation or its pollution response provision”, he said.
Last week oil and gas industry leaders in the UK insisted there was “no case” for a moratorium on offshore drilling in deep water here in the wake of the Gulf of Mexico disaster because the regulatory regime was very strong.
Mr Hayward has been at the centre of the storm over offshore drilling since the explosion on BP’s Deepwater Horizon rig in April, which killed 11 workers and left millions of gallons of oil gushing into the Gulf.
An internal investigation by BP into the reasons for the explosion blamed a “complex and interlinked” series of events involving mechanical failures and human judgments.
The probe by the oil giant, led by the company’s head of safety and operations, Mark Bly, found BP was responsible in part for the tragedy, but also placed some blame on rig owner Transocean and cement contractor Halliburton.
Mr Hayward strongly denied cost-cutting was a factor in the Deepwater Horizon disaster and insisted safety was “the first call on every dollar BP invests”.
“We have found no evidence in our assessment and investigation of this accident to suggest that costs were any part of how this occurred,” he told the committee.
“We have made the safe and reliable operations the number one priority of BP,” he said, listing a series of measures taken by the company over the last three years.
“It is undeniably the fact that because of all of that, this particular incident is so devastating to me personally because we have made an enormous amount of progress in that three-year period.”
He said the industry had drilled for 20 years in deep water without incident and assumed it had mitigated the risk of an incident – an assumption that turned out to be a very bad one, he admitted.
But while lessons could be learned from the Deepwater Horizon explosion, Mr Hayward said the challenges in the Gulf of Mexico were different from those in the North Sea.
The Gulf of Mexico was “undoubtedly” more challenging an environment than oil and gas sites to the west of Shetland.
He said the Deepwater Horizon disaster, and the costs of the clean-up incurred by BP, would not prevent the very significant investment the company was making in exploration in the North Sea.
And he said he did not think it was wise to bring in a moratorium on deepwater oil and gas drilling given the world’s demand for oil and gas.
Mr Hayward’s appearance before the committee of MPs follows a fiery session of the US House of Representatives Energy and Commerce Committee in June, where he was accused of ignoring safety warnings, attempting to shirk responsibility and presiding over “astonishing” corporate complacency.
Questioned today on whether he would have handled any of the public relations in the wake of the disaster differently, Mr Hayward – who was widely attacked by the US public and politicians following the explosion – said he would do many things differently.
“Given the scale of this tragedy, the enormity of the disaster, the emotion and anger in the US was very high and quite understandable,” he said.
“I understand why people feel the way they do, and there’s no doubt the inability of BP and the industry to seal the leak because it wasn’t prepared was unacceptable,” he said.
But he said BP had had a very constructive relationship with the US government as it put into place the biggest oil spill response in history.