Independent experts rarely called on to verify critical drilling equipment blamed in oil spill

WASHINGTON – something federal regulators mistakenly thought was happening offshore.

At least three government drilling engineers assigned to the federal investigation into the spill have acknowledged they had mistakenly assumed these third-party examinations were taking place. The examinations are voluntary under U.S. law and most rigs don't do them, even though they are more hands-on than routine government inspections.

This lapse in the offshore energy industry's safety net has emerged as a key finding in the joint federal inquiry by the Coast Guard and Bureau of Ocean Energy Management, Regulation and Enforcement into the largest offshore oil spill in U.S. history.

Now, the Obama administration has ordered every rig in the Gulf of Mexico to subject a central piece of drilling hardware — the blowout preventer — to certification by a third party before any can drill again. It is also investigating the extent of the regulators' fundamental misunderstandings.

"They were under the assumption that the certificate covers the whole aspect of the vessel — the vessel stability, the vessel conditions, the drilling unit, the drilling package, the whole nine yards," David Dykes, chief of the bureau's Office of Safety Management for the Gulf of Mexico region, said at a recent hearing in Washington. "What we have discovered is that the certificate doesn't necessarily cover the drilling package ... it is an elective option by the drilling contractor."

Certifications of the drilling system include regular checks — even underwater — of welding and wiring on equipment and include a rig's blowout preventer, which failed to stop the gusher. They also require companies to report any significant changes made to the equipment.

A reconfiguration of the blowout preventer on the rig that drilled the ill-fated Macondo well has been implicated in the disaster.

Drilling system certification covers all components and systems used for well control, said Ken Richardson, an executive for the American Bureau of Shipping, one of the three major classification societies that examine offshore oil rigs.

Whether such third-party oversight would have caught or prevented what happened aboard the Deepwater Horizon April 20 is unclear. Oil rigs are inspected routinely, by engineering firms, government agencies, equipment manufacturers and classification societies. All are a snapshot in time — much like an annual car inspection. Components can earn a passing grade only to break down days later.

What is clear is that certifications are more rigorous and detailed than the monthly inspections conducted by the government, and offer an additional set of eyes more independent than those of the equipment manufacturer. The Obama administration's recent order to examine blowout preventers before drilling commences excludes manufacturers.

Federal inspectors rarely inspect drilling hardware, including the blowout preventer, out of the water, unless it happens to be not drilling when they visit. That's an unlikely occurrence in an industry where drilling is money and leasing rigs can cost up to $500,000 a day.

Major inspections following manufacturers' guidelines are recommended by the industry and required by federal regulators every three to five years and include disassembling components such as the blowout preventer, although that didn't happen aboard the Deepwater Horizon, according to testimony from ongoing government investigations.

As the operator of the Deepwater Horizon, Transocean could have chosen to continue having its drilling equipment certified as safe, yet few rigs in operation worldwide opt for this.

Only a fraction — about 4 percent — of the 600 mobile offshore drilling units deemed fit by ABS, which has the largest share of the market, have elected to have their drilling equipment certified because it is not required in the U.S. or elsewhere. Lloyd's Register, another big player in offshore drilling rig classification, has no rigs on its roster with the optional certificate, which it has offered for more than 20 years.

Rigs sometimes obtain a drilling certificate because the company hiring the rig wants it. In other cases, a certificate will satisfy requirements in countries such as Norway, which has stricter rules for offshore drilling.

In Transocean's case, company policy was to obtain drilling system certification for all new rigs before they went into service, as it did on the Deepwater Horizon in 2000.

The American Bureau of Shipping witnessed the Horizon's original blowout preventer being manufactured and installed, and at least once in the five years inspected it out of the water. But when the certification came up for renewal in 2005, Transocean let it lapse.

A Transocean spokesman, Brian Kennedy, said the certificate was "simply duplicative" of the maintenance and inspections conducted by the rig's crew and the original equipment manufacturers. As for the major inspection of the blowout preventer, Kennedy said the company was exceeding the regulations by continuously inspecting and maintaining the blowout preventer.

Stewart Wade, a spokesman for the American Bureau of Shipping, said that once Transocean dropped the certification "it may not be the same blowout preventer as far as we know."

"We have no idea what was there. We had no idea whether it was modified. We have not had an association with it for the last five years," Wade said.

When BP submitted the various certifications for the Deepwater Horizon as part of its application to drill the Macondo well in January, the ABS one would have been missing a stamp — a Maltese Cross followed by the acronym CDS for "certification of the drilling system" — indicating that the drilling hardware, including the blowout preventer, had been examined by the society. Federal engineers didn't even know to look for one.

"Unbeknown to our drilling engineers ... there is a certain stamp for the drilling package certification," Dykes said.

That misunderstanding has led the joint Coast Guard-BOEM investigation to survey engineers in charge of reviewing permits for the Gulf of Mexico. Four — none of whom worked on the Macondo well — have answered so far. And all said that they only looked to see if the certificate was current.