BP (NYSE:BP) Made Bad Decisions Says Panel

Conclusions from a technical panel found that BP (NYSE:BP) responded poorly to circumstances as they unfolded, leading to the explosion on the Deepwater Horizon oil rig it was operating in the Gulf of Mexico.

The report stated there was a “lack of operating discipline” concerning the signs of potential risk to the rig and operations, which were apparently ignored.

Findings from the National Academy of Engineering and the National Research Council:

- Failures indicate the lack of a suitable approach for anticipating and managing the inherent risks, uncertainties, and dangers associated with deepwater drilling operations.

- Accident precipitated by decision to proceed to temporarily abandon well, despite indications from negative pressure tests that indicated problems with well integrity.

- BP, its contractors, and the government did not identify or correct critical mistakes.

- Decision to move ahead with completing project was compounded by delays in realizing natural gas was flowing in well and riser and failure to take timely well-control actions.

- Proceeding to remove drilling mud from well without installing lockdown sleeve on production casing wellhead seals may have also contributed to accident.

- Decisions to move ahead despite warning signs indicate "insufficient consideration of risk and a lack of operating discipline."

- There were insufficient checks and balances for decisions regarding schedule and procedures for well abandonment and considerations for well safety.

- Other factors that may have contributed to accident include BP's decision to use long string well design, use of only six centralizers on casing and not running bond log to assess cement integrity in well.