BP pleads guilty to environmental crime

Similarly, BP tried to save money at their Cherry Point refinery when they decided to stop prebooming their oil transfers. They even went so far as to remove the mooring system enabling them to place boom around a tanker. Once required to reinstall the system as a result of (Ocean Advocates et al v US Army Corps and BP) a diver was accidentally killed during the installation process. BP is running an add in this week’s Seattle Weekly on page 79 for an operations technician to work a 12-hour rotating shift for $24.88. The minimum requirement is a GED. It’s scary when you read the list of responsibilities.

Fred

Anchorage Daily News
November 29, 2007

http://www.adn.com/money/industries/oil/prudhoe/story/9487095p-9398146c.html

Daily News staff and wire services
Published: November 29, 2007
Last Modified: November 29, 2007 at 12:15 PM

BP pleaded guilty today to a federal environmental crime for failing to prevent a crude spill in America’s largest oil field.

BP Exploration Alaska Inc. pleaded guilty to one misdemeanor violation of the Clean Water Act for a 201,000-gallon spill at the Prudhoe Bay field in March 2006.

The company, a subsidiary of London-based oil giant BP, had agreed last month to a sentence of $20 million in fines and restitution related to the spill, the largest ever on the North Slope.

The settlement was one of several struck in October between the oil and gas giant and federal investigators.

BP agreed to pay another $353 million in fines and restitution over the manipulation of propane markets in the Midwest and a refinery explosion that killed 15 people in Texas.

For years, the company denied allegations that a cost-cutting culture was hurting the quality of maintenance on the network of steel pipes at the 30-year old Alaska field.

But after the spill in March, federal prosecutors said millions of company documents and interviews with scores of North Slope employees told a different story.

They discovered a “failure to allocate sufficient resources to ensure safe and environmentally protective operation of the pipelines that leaked,” according to court documents.

Prosecutors estimate BP saved $9 million by not regularly cleaning and inspecting two of its pipelines over the course of several years. The estimated savings represented less than half of 1 percent of BP’s adjusted net profit of $22 billion in 2006.

Nelson Cohen, U.S. attorney for Alaska, told the court today that for eight years before last year’s spills BP didn’t run testing and cleaning devices through the pipes. “We submit that would be proof of negligence.”

Photos submitted to the court of the pipe show 6-inch-deep sludge accumulated in the pipe, contributing to the leak.

Federal District Judge Ralph Beistline, who accepted BP’s plea and imposed the sentence, said BP needs to put more emphasis on maintenance and less on profits.

The oil company’s leak-detection technology was ineffective because, although alarms sounded, workers didn’t believe them, Beistline said. He likened it to a car owner ignoring a “check engine” light, thinking that the problem is a malfunctioning light rather than a problem with the engine.

The $20 million in fines and restitution should be an adequate warning to BP and other North Slope oil companies, Beistline said. “There’s 20 million reasons right off the bat it shouldn’t happen again.”

James Wilk, a BP vice president in Alaska, expressed regret for the spill and for not having detected pipeline corrosion that caused the spills.

Both of those pipelines sprung leaks in 2006 and prompted BP to halve production at Prudhoe Bay to 200,000 gallons a day for several weeks.

BP is replacing 16 miles of corroded pipe at Prudhoe, and the new pipe comes with better leak-detection equipment, said Ronnie Chappell, a spokesman for the company.

BP manages Prudhoe Bay on behalf of its production partners Exxon Mobil Corp., Conoco Phillips and Chevron. The company has said it is investing heavily in upgrading its North Slope operations.

BP ALASKA PLEA AT A GLANCE

Pleaded guilty to a misdemeanor violation of the Clean Water Act.

To serve three years of probation.

To pay a $12 million criminal fine.

To pay $4 million criminal restitution to the state.

To pay $4 million for research on Alaska’s Arctic.

Reported by Daily News reporter Wesley Loy and Jeannette Lee of The Associated Press. Loy can be reached at wloy@adn.com or 257-4590.

~ by fredfelleman on November 29, 2007.

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