September 08, 2006
Friday

WASHINGTON -- The first of at least four congressional hearings into why BP failed to prevent pipeline failures on Alaska's North Slope began dramatically Thursday when Richard Woollam, the company's corrosion chief until 2005, refused to testify, citing his Fifth Amendment right against self-incrimination.

In a day marked with blistering criticism of BP from Republicans and Democrats on the House Energy and Commerce Committee, the British-born Woollam, derided in an internal BP report as "King Richard" for his dictatorial style, refused to answer any questions.

The committee's investigations panel is looking into the failure of BP to monitor and control corrosion on two smaller North Slope transit pipelines that feed the main trans-Alaska pipeline.

One of those lines had a catastrophic leak on March 2, spilling more than 200,000 gallons of oil in the tundra and the ice-locked shore of an unnamed lake. The other line had a smaller leak in August. Unsure of the reliability of either line, BP announced it would shut down all North Slope production Aug. 6, then limited the closure to the field's eastern half.

Over and over, the committee members grilled BP Exploration (Alaska) President Steve Marshall about why BP neglected to conduct the only reliable test of the decay of an entire pipeline, a "smart pig" that travels inside the pipe and records the thickness of the wall along its length.

Marshall replied that the company thought the line wasn't as susceptible to corrosion as others. The last smart pig run on the western line was in 1998 and on the eastern line in 1992.

But was it just an error in judgment, or was something else at work, the committee wanted to know. Was BP shaving costs to increase profits? Were executives trying to beef up their annual bonuses by meeting budgets regardless of the consequences? Committee chairman Joe Barton, R-Texas, wondered aloud whether BP was "betting the farm" that the Prudhoe Bay field would run out before the pipeline failed, saving the costs of replacing it.

"Shame, shame, shame," he said.

Marshall and the new BP America president, Bob Malone, denied that profit motive was the cause, but they were frequently at a loss to explain what happened.

Malone, Marshall and two others, Alyeska Pipeline Service Co. President Kevin Hostler and Dan Stears of Coffman Engineers in Anchorage, all testified under oath.

Woollam was a late entry on the witness list. House investigators looking into claims that corrosion workers were afraid to criticize BP's practices unearthed an internal BP report from 2004. That report, by the law firm Vinson & Elkins, said Woollam's "overbearing management style" created a climate "where the fear of retaliation and intimidation could and did occur."

The workers believed the company wasn't doing enough to test for corrosion and prevent its spread, according to the report, made public at the hearing.

Woollam was transferred to a non-supervisory job in Houston in January 2005 and recently was placed on administrative leave with pay, Malone said.

After taking the Fifth Amendment in the packed hearing room, Woollam was quickly dismissed from the hearing. He rushed from the Rayburn House Office Building without speaking to reporters.

Woollam, and the presence of a battery of defense attorneys, was a sharp reminder of grand jury proceedings in Anchorage hanging over the congressional hearings. The Justice Department and the Environmental Protection Agency are investigating whether the oil spill was a criminal violation of the Clean Water Act.

Barton reminded the BP officials that their shutdown briefly caused a 3 percent spike in the price of oil to nearly $77 a barrel.

The two transit lines were unregulated by the U.S. Transportation Department's Pipeline and Hazardous Materials Safety Administration because they operated on low pressure in a remote area. Even after the spill, when the agency decided to impose its regulatory authority, BP resisted, said its administrator, Thomas Barrett, testifying later before the committee.

"It's the kind of thing that would cause us to question their commitment," responded Rep. John Dingell, D-Mich.

Barrett's chief safety officer, Stacy Gerard, said BP had a pattern of resisting regulation. Gerard added BP argued had that a spill in the North Slope wouldn't hurt any animal protected by the endangered species act, so it shouldn't be required to join the program.

SitNews
Stories In The News
Ketchikan, Alaska