Where did judgment and decision making fall down in rig fiasco?

Senior BP and Transocean executives told lawmakers Wednesday that discrepancies in key pressure tests on the afternoon of the explosion should have raised alarms according to a Wall St. Journal article  Red Flags Were Ignored by Doomed Rig. They should “lead to a conclusion that there was something happening in the well bore that shouldn’t be happening,” Transocean CEO Steven Newman told the House Energy and Commerce Committee.

So, where did things go wrong?  Was it a single bad decision or several errors in judgment?  Was it an issue of lack of knowledge or purposefully ignoring signals that might have led the team down a different path?  Was it simply a high level cost vs risk call (still a judgement and decision making error).

At first we thought the problem might have been that adequate tests weren’t done, but now it appears it might be a matter of interpretation of tests. It might also be an issue of poor cost-risk analysis on the part of of senior managers. Let’s review. This sequence of events is taken from the above referenced Wall St. Journal article.

At 8 p.m. Halliburton workers pours cement into the pipe to fill in the space between the outside of the pipe and the rock. The cement was laced with nitrogen to help seal out gas. Two hours later, workers started pumping in the heavy mud which was supposed to push the cement down and out of the pipe, and it also would serve to keep anything from flowing upward.

By 12:35 a.m. there was cement around the pipe. If all had gone well, the only pathway for oil, gas or fluids to move to the surface was through steel pipe. Right at the end, Halliburton poured a cement plug to seal the very bottom of the well.

Before the well could be called complete, several pressure tests had to be run. The first occurred the afternoon of April 20, and all indications were that the well and cement were working as expected, company records show. But while all this was going on, according to a memo from BP to congressional investigators, hydrocarbons were entering the well. Most likely, these were a combination of natural gas and condensate, a petroleum liquid.

At 5 p.m., workers ran another key test called a negative pressure test, used to determine if the well had been properly cemented. The pressure in the well was lowered to see if gas could enter. Test results were at best “inconclusive” and at worst “not satisfactory,” Mr. Dupree, the BP Senior Vice President for the Gulf of Mexico, said, according Mr. Waxman. It appeared the cement job hadn’t sealed off the well and a gaseous mixture was leaking into it.

A second test was run. Mr. Dupree said its results could indicate that natural gas was building up inside the well, according to Mr. Waxman.

At 8 p.m., less than two hours before the blast, BP officials decided that additional tests “justified ending the test and proceeding,” Mr. Waxman said, attributing this information to a communication from a BP lawyer. The congressman said information reviewed by his committee “describes an internal debate between Transocean and BP personnel about how to proceed.”

One course would have been to try to shore up the cement. As the cement contractor, Halliburton could have shot a hole through the pipe and squeezed more cement in between the pipe and the rock. A new section of pipe would then have had to be installed to replace the pierced piece, industry officials explain. This would have taken a week to 10 days, says one industry veteran. Between the cost of hiring the rig and the subcontractors, this maneuver could have cost BP $5 million to $10 million, according to industry estimates.

This extra work, however, wasn’t pursued. Instead, BP forged ahead. Workers began to remove the mud. A log provided by investigators shows significant volumes of the heavy fluid coming out between 8:10 p.m. and 8:30 p.m.

But as workers took out the heavy mud and lighter seawater flowed in, gas began to rise. It still isn’t clear if the gas came up the pipe or came up the outside of the pipe and then entered the pipe around the seafloor.

As gas flowed up 5,000 feet of pipe from the sea floor to the surface, it got warmer and expanded, pushing drilling mud and seawater ahead of it. The blowout had begun, setting off the fire that sank the Horizon.

So, what’s your “read” at this point?  Where did things fall down?  What were the “signals” that might have helped the team know what was going on?  Was there a problem with interpretation of the tests?  Should there have been more or different tests?  Should there have been more input from those on the front line?  Was it a breakdown in communication between contracting groups?

We’ll continue to use the BP story to try to better understand knowledge and judgment issues.  After all, that’s really what knowledge transfer is all about – identifying the kind of critical knowledge that needs to be transferred in order for people to be able to make important decisions like those mentioned above.

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