BP seeks to head off US regulatory attack with safety and ethics review

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The Independent Online

BP is to conduct a wide-scale review of the safety and ethics of its North American operations, to try to head off criticism over its record in the US and prevent any more environmental and safety disasters.

It is setting up an internal task force to make flying visits to the company's operations and to report back on whether proper safety procedures are being followed. The plan comes as BP faces questions over how pipelines at its vital Alaskan oilfield, Prudhoe Bay, became so corroded that it has been forced to shut down the whole operation. It is likely to decide tomorrow if it can keep half the field open.

The crisis follows an explosion at a BP refinery in Texas last year in which 15 employees died, and on charges this year against the company's US energy trading division, where workers are accused of manipulating the propane market.

The decision to launch a safety and ethics review was taken by Bob Malone, who was appointed head of BP in North America at the start of the year. It implicitly acknowledges how the string of disasters has tarnished BP's reputation in the US, and will form part of the company's defence if politicians and regulators step up their attacks on the company.

The FBI is talking to employees and former employees in Alaska who claim BP ignored their warnings about a poor inspection regime for the pipelines at Prudhoe Bay. The criminal investigation and possible action by regulators was sparked when 200,000 gallons of oil leaked from the corroded pipeline in March, Alaska's worst-ever on-land spill. And last weekend, BP said it would shut Prudhoe Bay to allow 16 miles of pipelines to be replaced.

Charles Hamel, a former oil broker who acted as a go-between for whistleblowers on BP's staff in Alaska, said: "Prudhoe Bay is an ageing field, BP knows it needs maintenance. They deferred the maintenance. They are cheap and they are playing Russian roulette."

Mr Malone said BP's problems in the US were isolated, rather than evidence of a wider malaise. However, he has appointed a new vice-president of compliance and ethics, Rick Cape, to lead a review of safety and compliance issues.

"We are staffing up with world-class operational integrity experts who will report directly to me," Mr Malone said, "and with compliance and ethics staff, whose charge will be to visit facilities and assure me of the safety and integrity of our operations."

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