BP accused of lying to Congress to reduce liabilities

BP HAS been accused by a senior US politician of lying to Congress to reduce its liabilities, after an internal company document…

BP HAS been accused by a senior US politician of lying to Congress to reduce its liabilities, after an internal company document showed that the oil giant’s own worst-case assessment of the size of the oil leak in the Gulf of Mexico was 20 times its public estimate.

In the document, BP attempts to put a figure on the rate of oil spewing into the ocean. It notes that if the condition of the well bore deteriorates to the extent that crucial parts fall off, the rate could reach 100,000 barrels a day.

When the company handed the document to Congress, it was claiming the leak was only 5,000 barrels a day, and that at very worst the figure could rise to 60,000.

The document was circulated by Ed Markey, the Democratic head of the House subcommittee on energy and the environment.

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In a statement, he said: “This document raises very troubling questions about what BP knew and when they knew it. It is clear that, from the beginning, BP has not been straightforward with the government or the American people about the true size of this spill.”

The congressman, who has hounded BP on its handling of the crisis, said on Sunday’s Meet the Press on NBC: “First they said it was 1,000 barrels, then they said it was 5,000 barrels, now we are up to 100,000 barrels.”

From the beginning BP had either been lying to limit their liability or were “grossly incompetent”, delaying a “full response to the magnitude of this disaster”.

The document makes clear that the likelihood of the crucial bits of equipment – the blow-out preventer and wellhead – being removed from the well was low. But the fact that BP itself estimated the worst possible leak in the Gulf at 100,000 barrels a day, in contrast to its own lower public estimates, adds to the growing sense in Washington that the company has not been fully transparent over the scale of the disaster.

The renewed pressure on BP came as US rig operators and other offshore oil services companies prepared to go to court today to try to overturn president Barack Obama’s moratorium on deepwater drilling. The companies claim that the ban will result in more economic damage to the region, as rigs and jobs move overseas.

The US government has said that it will not lift the ban until more is known about the causes of the accident, and the industry’s safety procedures are reviewed.

It emerged this month that BP’s disaster response plan was so inadequate that it listed a wildlife expert who had died in 2005.

It outlined how walruses would be affected by a spill, even though they do not live in the Gulf. Exxon Mobil, ConocoPhillips, Chevron and Shell used the same firm to prepare their disaster plans, which are identical in huge chunks.

US politicians said that the companies were just as unprepared as BP to handle a spill in the Gulf, accusing them of “Xeroxing” their disaster plans.

BP yesterday sought to downplay American anger at BP chief executive Tony Hayward yachting on the Isle of Wight at the weekend. Photographs of Mr Hayward on board his 52ft yacht, Bob, racing around the Isle of Wight provoked uproar in Washington.

The White House chief of staff, Rahm Emanuel, joked to ABC’s This Week that “He’s got his life back, as he would say,” a reference to Mr Hayward’s much lamented comment. “I think we can all conclude that Tony Hayward is not going to have a second career in PR consulting,” he added.

US media accused Mr Hayward of “turning his back” on the Gulf, reporting that the US BP executive Bob Dudley had taken control of the oil response effort. Mr Hayward will spend more time running the rest of the BP business in the UK and around the world.

But Mr Hayward will still spend more than half his time in the US and will continue to oversee the effort, according to company sources. – ( Guardianservice)