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Risk Management Failures Of British Petroleum

2058 words - 9 pages

BP is a British global energy company which is the third largest energy company and the fourth largest company in the world. As a multinational oil company, BP is the UK's largest corporation, with its headquarters in St James's, City of Westminster, London. BP America's headquarters is in the One Westlake Park in the Energy Corridor area of Houston, Texas; the company is among the largest private sector energy corporations in the world, and one of the six leaders.
In order to project social responsibility and improve its image British Petroleum changed its name into BP in year 2000 with a logo of green and yellow sunflower patterns. Paradoxically the same company symbol is now under ...view middle of the document...

The fall-out from the accident continues to cloud BP's corporate image because of the mismanagement at the plant. There have been several investigations of the disaster, the most recent being that from the U.S. Chemical Safety and Hazard Investigation Board which offered a derisive evaluation of the company. The US Occupational Safety and Health Administration (OSHA) found organizational and safety deficiencies at all levels of the BP Corporation and said management failures could be traced from Texas to London.
The company pleaded guilty to a felony violation of the Clean Air Act, was fined $50 million, and sentenced to three years probation.
On October 30, 2009, OSHA fined BP an additional $87 million— the largest fine in OSHA history— for failing to correct safety hazards revealed in the 2005 explosion. Inspectors found 270 safety violations that had been previously cited but not fixed and 439 new violations. BP is appealing that fine.
In August 2006, BP shut down oil operations in Prudhoe Bay, Alaska, due to corrosion in pipelines leading up to the Alaska Pipeline. The wells were leaking insulating agent called Arctic pack, consisting of crude oil and diesel fuel, between the wells and ice. BP had spilled over one million liters of oil in Alaska's North Slope. This corrosion is caused by sediment collecting in the bottom of the pipe, protecting corrosive bacteria from chemicals sent through the pipeline to fight this bacteria. There are estimates that about 5000 barrels (790 m3) of oil were released from the pipeline. To date 1513 barrels (240.5 m3) of liquids, about 5200 cubic yards (4000 m3) of soiled snow and 328 cubic yards (251 m3) of soiled gravel have been recovered. After approval from the DOT, only the eastern portion of the field was shut down, resulting in a reduction of 200000 barrels per day (32000 m3/d) until work began to bring the eastern field to full production on 2 October 2006.
In May 2007, the company announced another partial field shutdown owing to leaks of water at a separation plant. Their action was interpreted as another example of fallout from a decision to cut maintenance of the pipeline and associated facilities.
On 16 October 2007 Alaska Department of Environmental Conservation officials reported a toxic spill of methanol (methyl alcohol) at the Prudhoe Bay oil field managed by BP PLC. Nearly 2,000 gallons of mostly methanol, mixed with some crude oil and water, spilled onto a frozen tundra pond as well as a gravel pad from a pipeline. Methanol, which is poisonous to plants and animals, is used to clear ice from the insides of the Arctic-based pipelines.
From January 2006 to January 2008, three workers were killed at the company's Texas City, Texas refinery in three separate accidents. In July 2006 a worker was crushed between a pipe stack and mechanical lift, in June 2007, a worker was electrocuted, and in January 2008, a worker was killed by a 500-pound piece of metal that came loose under high...

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