## THE BUREAU OF OCEAN ENERGY MANAGEMENT,

REGULATION AND ENFORCEMENT

REPORT REGARDING THE CAUSES OF THE APRIL 20, 2010

MACONDO WELL BLOWOUT

September 14, 2011i 

### TABLE OF CONTENTS

Executive Summary ................................................................................................1

I. Introduction ..................................................................................................... 10

A. The Investig ation ......................................................................................... 10

B. Background Regarding Deepwater Drilling in the Gulf of Mexico ............ 13

C. Companies Invol ved in the Macondo Well .................................................. 16

D. The Deepwater Horizon ............................................................................... 18

E. The Macondo Well ....................................................................................... 19

F. The Blowout ................................................................................................. 23

II. Well Design ...................................................................................................... 25

A. Cost of th e Macondo Well ............................................................................ 25

B. Drilling Margi n ........................................................................................... 27

C. Casing Program ........................................................................................... 31

D. Mud Program and Type .............................................................................. 32

E. Mud Losses .................................................................................................. 33

F. Well Ba llooning ........................................................................................... 34

G. Planned and Actual Total Depth ................................................................. 34

H. Designing the Production Casing

– Long String versus Liner ................... 36

III. Cementing ........................................................................................................ 40

A. Cementing Process ....................................................................................... 40

B. Cement Des ign and Modeling ..................................................................... 41

C. Gas Flow Potential ....................................................................................... 46

D. Centralizers .................................................................................................. 47

E. Float Collar .................................................................................................. 49

F. Cementing the Macondo Production Casing .............................................. 53

G. Industry Standards for Cementing .............................................................. 57

IV. Possible Flow Paths ........................................................................................ 61

V. Conclusions on Well Design, Cementing, an d Flow Path ........................ 68

A. Cause of the Failure of the Cement B arrier .................................................. 68

B. Contributing Causes of the Cement Barrier Failure ................................... 68

C. Possible Contributing Causes of th e Cement Barrier Failure ..................... 70

D. Flow Path Cause .......................................................................................... 73

VI. Challenges at the Mac ondo Well .................................................................. 75

A. Kicks and Stuck Drill Pipe .......................................................................... 75

B. Scheduling Conflicts an d Cost Overruns .................................................... 78

C. Personnel Changes and Conflicts ................................................................ 79

D. Safety Stand

‐ down ....................................................................................... 83

VII. Temporary Abandonment of the Macondo Well ....................................... 85ii A. Installing th e Lock

‐ Down Sleeve ................................................................. 85

B. Setting th e Cement Plug .............................................................................. 86

C. The Use of Lo st Circulation Material as Spacer .......................................... 87

D. Well Integr ity Testing ................................................................................. 88

VIII. Kick Detection and Rig Response ................................................................. 98

A. Kick Detect ion Methods and Responsibilities .............................................. 98

B. Multip le Simultaneous Operations That Hampered the Crew’s Ability to

Detect Kicks ................................................................................................. 99

C. Rig Floor Response .................................................................................... 103

D. The Use of the Mud Gas Separator ............................................................ 104

E. Activity on the Bridge ................................................................................ 106

F. Emergency Disconnect System .................................................................. 107

IX. Conclusions on Temp orary Abandonment, Kick Detection, and the

Emergency Response ................................................................................... 109

A. Kick Detect ion and Response Failure Cause ............................................. 109

B. Kick Detect ion Failure Contributing Causes ............................................ 109

C. Kick Detect ion Failure Possible Contributing Causes .............................. 110

D. Response Failure Contributing Causes ..................................................... 112

E. Response Failure Possible Contributing Causes ....................................... 113

X. Ignit ion Source(s) and Explosions .............................................................. 115

A. Main Engin es and Engine Switch Gear Rooms ........................................ 115

B. Mud Gas Separator .................................................................................... 119

C. Other Possible Ign ition Sources ................................................................ 122

XI. Conclusions on Ignitio n Source and Explosion ........................................ 125

A. Ignition Sources ......................................................................................... 125

B. Contributing Causes of the Explosion ....................................................... 125

C. Possible Contributing Causes of th e Explosion ......................................... 126

D. Other Possible Ign ition Sources ................................................................ 127

XII. The Deepw ater Horizon BOP Stack ............................................................... 129

A. Design and Configurat ion ......................................................................... 129

B. Control and Power Systems ....................................................................... 132

C. Emergency Disconnect System .................................................................. 133

D. Automatic Mode Function (“De adman”) ................................................. 134

E. Autoshear Function ................................................................................... 134

F. Forensic Examina tion of the BOP ............................................................. 135

G. Examinat ion Methods Used by DNV ........................................................ 137

H. DNV’s Forensic Examin ation Findings .................................................... 138

I. Evaluation of Other Possible Failures ....................................................... 142

J. Studies Evaluating the R eliability of BOPs .............................................. 144

K. Maintenanc e of the Deepwater Horizon BOP ........................................... 146iii L. BOP System Leaks ..................................................................................... 151

M. ROV Interv entions .................................................................................... 153

XIII. BOP Stack Conclusions ................................................................................ 155

A. Cause of the BOP Stack Failure ................................................................. 155

B. BOP Stack Failure Contributing Causes .................................................. 155

C. BOP Stack Failure Po ssible Contributing Causes ..................................... 155

XIV. Regulatory Findi ngs ..................................................................................... 157

A. Permit ting Process ..................................................................................... 158

B. Well Activity Reports ................................................................................ 161

C. Macondo Departures and Alternativ e Procedures .................................... 161

D. MMS Drilling Inspections ........................................................................ 162

E. Potential In cident of Noncompliance Guidelines ...................................... 162

F. Inspection Fo rms ........................................................................................ 164

G. MMS Deep water Horizon Inspections at MC 252 ................................... 164

H. Safe Dr illing Margin ................................................................................. 165

I. Well Control ............................................................................................... 165

J. Subsea BOP Regulatory Requiremen ts ..................................................... 167

K. Regulatory Improvements ......................................................................... 172

L. Incidents of Non

‐ Comp liance .................................................................... 173

XV. Policies and Practices of Involved Companies ......................................... 175

A. BP’s Policie s and Practices ........................................................................ 175

B. Transocean’s Practices and Procedures ..................................................... 185

C. BP and Transocean Bridging Document ................................................... 189

D. Stop Work Authority ................................................................................. 189

XVI. Conclusions Regarding Involved Companies’ Practices ......................... 191

XVII. Summary of Panel Conclusions .................................................................. 194

A. Well Design and Cement ing ...................................................................... 194

B. Flow Path ................................................................................................... 195

C. Temporary Abandonment, Kick Det ection, and Emergency Response ..... 195

D. Ignition Source .......................................................................................... 197

E. Blowout Preventer ..................................................................................... 198

F. Company Practices .................................................................................... 199

XVIII. Conclusion ..................................................................................................... 200

XIX. Recommendations ......................................................................................... 202

A. Well Recommendations .............................................................................. 202

B. Kick Detect ion and Response Recommendations ...................................... 203

C. Ignition Source Recommendations ............................................................ 205

D. Blowout Preventer Recommendat ions ....................................................... 206

E. Regulatory Agency Recommenda tions ...................................................... 207

F. OCS Companies’ Practices Recomme ndations .......................................... 209iv 

### Dedication ............................................................................................................. 211

Acknowledgement............................................................................................... 2121 

## Executive Summary

At approximately 9:50 p.m. on the evening of April 20, 2010, while the

crew of the Deepwater Horizon rig was finishing work after drilling the Macondo

exploratory well, an undetected influx of hydrocarbons (commonly referred to as

a “kick”) escalated to a blowout. Shortly after the blowout, hydrocarbons that

had flowed onto th e rig floor through a mud

‐ gas vent line ignited in two

separate explosions. Flowing hydrocarbons fueled a fire on the rig that

continued to burn until the rig sank on April 22. Eleven men died on the

Deepwater Horizon that evening. Over the next 87 days, almost five million

barrels of oil were discharged from the Macondo well in to the Gulf of Mexico. 1

After an extensive investigation conducted by the Joint Investigation

Team of the Bureau of Ocean Energy Management, Regulation and Enforcement

(“BOEMRE”) (formerly the Minerals Management Service or “MMS”) and the

United States Coast Guard, the BOEMRE panel of investigators (“the Panel”) has

identified a number of causes of the Macondo blowout.

The Panel found that a central cause of the blowout was failure of a

cement bar rier in the production casing string, a high

‐ strength steel pipe set in a

well to ensure well integrity and to allow future production. The failure of the

cement barrier allowed hydrocarbons to flow up the wellbore, through the riser

and onto the rig, resulting in the blowout. The precise reasons for the failure of

the production casing cement job are not kno wn. The Panel concluded that the

failure was likely due to: (1) swapping of cement and drilling mud (referred to as

“fluid inversion”) in th e shoe track (the section of casing near the bottom of the

well); (2) contamination of the shoe track cement; or (3) pumping the cement past

the target location in the well, leaving the shoe track with little or no cement

(referred to as “over

‐ displacement”).

The loss of life at the Macondo si te on April 20, 2010, and the subsequent

pollution of the Gulf of Mexico through the summer of 2010 were the result of

poor risk management, last

‐ minute changes to plans, failure to observe and

respond to critical indicators, inadequate well control response, and insufficient

1 This estimate is based upon pressure readings, data, and analysis conducted by U.S. scientific

teams commissioned by the National Incident Commander. See

http://www.doi.gov/news/pressreleases/US

‐ Scientific

‐ Teams

‐ Refine

‐ Estimates

‐ of

‐ Oil

‐ Flow

‐ from

‐

BP

‐ Well

‐ Prior

‐ to

‐ Capping.cfm.2 emergency bridge response training by companies and individuals responsible

for drilling at the Macondo well and for the operation of the Deepwater Horizon

.

BP, as the designated operator under BOEMRE regulations, was

ultimately responsible for conducting operations at Macondo in a way that

ensured the safety and protection of personnel, equipment, natural resources,

and the environment. Transocea n, the owner of the Deepwater Horizon, was

responsible for conducting safe operations and for protecting personnel onboard.

Halliburton, as a contractor to BP, was responsible for conducting the cement job,

and, through its subsidiary (Sperry Sun), had certain responsibilities for

monitoring the well. Cameron was responsible for the design of the Deepwater

Horizon blo wout preventer (“BOP”) stack.

At the time of the blowout, the rig crew was engaged in “temporary

abandonment” activities to secure the well after drilling was completed and

before the Deepwater Horizon left the site. In the days leading up to April 20, BP

made a seri es of decisions that complicated cementing operations, added

incremental risk, and may have contributed to the ultimate failure of the cement

job. These decisions included:

 The use of only one cement barrier. BP did not set any additional cement or

mechanical barriers in the well, even though various well conditions

created difficulties for the production casing cement job.

 The location of the pr oduction casing. BP decided to set production casing in

a location in the well that created additional risk of hydrocarbon influx.

 The decision to install a lock

‐ down sleeve. BP’s decision to include the setting

of a lock

‐ down sleeve (a piece of equipment that connects and hold s the

production casing to the wellhead during production) as part of the

temporary abandonment procedure at Macondo increased the risks

associated with subsequent operations, including the displacement of

mud, the negative test sequence and the setti ng of the surface plug.

 The production casing cement job. BP failed to perform the production

casing cement job in accordance with industry

‐ accepted

recommendations.

The Panel concluded that BP failed to communicate these decisions and

the increasing operational risks to Transocean. As a result, BP and Transocean3 personnel onboard the Deepwater Horizon on the evening of April 20, 2010, did

not fully identify and evaluate the risks inherent in the operations that were

being conducted at Macondo.

On April 20, BP and Transocean personnel onboard the Deepwater Horizon

missed the opportunity to remedy the cement problems when the y

misinterpreted anomalies encountered during a critical test of cement barriers

called a negative test, which seeks to simulate what will occur at the well after it

is temporarily abandoned and to show whether cement barrier(s) will hold

against hydrocarbon flow.

The rig crew conducted an initial negative test on the production casing

cement job that showed a pressur e differential between the drill pipe and the kill

line, which is a high

‐ pressure pipe leading from the BOP stack to the rig pumps.

This was a serious anomaly that should have alerted the rig crew to potential

problems with the cement barrier or with th e negative test. After some

discussion among members of the crew and a second negative test on the kill

line, the rig crew explained the pressure differential away as a “bladder effect,” a

theory that later proved to be unfounded. Around 7:45 p.m., after observing for

30 minutes that there was no flow from the kill line, the rig crew conclu ded that

the negative test was successful. At this point, the rig crew most likely

concluded that the production casing cement barrier was sound.

The cement in the shoe track barrier, however, had in fact failed, and

hydrocarbons began to flow from the Macondo reservoir into the well. Despite a

number of additional anomalies that should have signaled the existence of a kick

or well flow, the crew failed to detect that the well was flowing until 9:42 p. m.

By then it was too late

– the well was blowing drilling mud up into the derric k

and onto the rig floor. If members of the rig crew had detected the hydrocarbon

influx earlier, they might have been able to take appropriate actions to control

the well. There were several possible reasons why the Deepwater Horizon crew

did not de tect the kick:

 The rig crew had experienced problems in promptly detecting kicks. The

Deepwater Horizon crew had experienced a kick on March 8, 2010 that went

undetected for approximately 30 minutes. BP did not conduct an

investigation into the reasons for the delayed detection of the kick.

Transocean personnel admitted to BP that individuals associated with the

March 8 ki ck had “screwed up by not catching” the kick. Ten of the 114 individuals on duty on March 8, who had well control responsibilities,

were also on duty on April 20.

 Simultaneous rig operations hampered the rig crew’s well monitoring abilities.

The rig crew’s decision to conduct simultaneous operations during the

critical negative tests

‐ including displacement of fluids to two active mud

pits and cle aning the pits in preparation to move the rig

‐ complicated

well

‐ monitoring efforts.

 The rig crew bypassed a critical flow meter. At approximately 9:10 p.m., the

rig crew directed fluid displaced from the well overboard, which

bypassed the Sperry Sun flow meter, which is a critical kick detection tool

that measures outflow from the well. The Deepwater Horizon wa s

equipped with other flow meters, but the Panel found no evidence that

these meters were being monitored prior to the blowout.

Once the crew discovered the hydrocarbon flow, it sent the flow to a mud

‐

gas separator, a piece of equipment not designed to ha ndle high flow rates. The

mud

‐ gas separator could not handle the volume of hydrocarbons, and it

discharged a gas plume above the rig floor that ignited.

The Panel found evidence that the configuration of the Deepwater Horizon

general alarm system and the actions of rig crew me mbers on the bridge of the

rig contributed to a delay in notifying the entire crew of the presence of very

high gas levels on the rig. Transocean had configured the Deepwater Horizon ’s

general alarm system in “inhibited” mode, which meant that the general alarm

would not automatically sound when multiple gas alarms were triggered in

different areas on the ri g. As a result, personnel on the bridge were responsible

for sounding of the general alarm. Personnel on the bridge waited

approximately 12 minutes after the sounding of the initial gas alarms to sound

the general alarm, even though th ey had been informed that a “well control

problem” was occurring. During this period, there were approximately 20

alarms indicating the highest level of gas concentration in different areas on the

rig.

The Deepwater Horizon ’s BOP stack, a massive, 360

‐ ton device installed at

the top of the well, was designed to allow the rig crew to handle numerou s types

of well control events. However, on April 20, the BOP stack failed to seal the

well to contain the flow of hydrocarbons. The explosions likely damaged the

Deepwater Horizon ’s multiplex cables and hydraulic lines, rendering the crew5 unable to activate the BOP stack. The BOP stack was equipped with an

“automatic mode function,” which upon activation would trigger the blind shear

ram (BSR), two metal blocks with blades on the inside edges that are designed to

cut through the drill pipe and seal the well during a well control event.

The Panel concluded that there wer e two possible ways in which the BSR

might have been activated: (1) on April 20, by the automatic mode function,

immediately following loss of communication with the rig; or (2) on April 22,

when a remotely operated vehicle triggered the “autoshear” function, which is

designed to close the BSR if the lower marine riser package disconnects from the

rest of the BOP stack. Regardless of how the BSR was activated, it did not seal

the well.

A forensic examination of the BOP stack revealed that e lastic buckling of

the drill pipe had forced the drill pipe up against the side of the wellbore and

outside the cutting surface of the BSR blades. As a result, the BSR did not

completely shear the drill pipe an d did not seal the well. The buckling of the

drill pipe, which likely occurred at or near th e time when control of the well was

lost, was caused by the force of the hydrocarbons blowing out of the well; by the

weight of the 5,000 feet of drill pipe located in the riser above the BOP forcing the

drill pipe down into the BOP stack; or by a combination of both. As a result of

the failure of the BSR to completely cut the drill pipe an d seal the well,

hydrocarbons continued to flow after the blowout.

Prior to the events of April 20, BP and Transocean experienced a number

of problems while conducting drilling and temporary abandonment operations

at Macondo. These problems included:

 Recurring well control event s and delayed kick detection. At least three

different well control events and multiple kicks occurred during

operations at Macondo. On March 8, it took the rig crew at least 30

minutes to detect a kick in the well. The delay raised concerns among BP

personnel about the Deepwater Horizon cre w’s ability to promptly detect

kicks and take appropriate well control actions. Despite these prior

problems, BP did not take steps to ensure that the rig crew was better

equipped to detect kicks and to handle well control events. As of April 20,

Transocean had not completed its investigation into the March 8 incident.

 Scheduling conflicts an d cost overruns. At the time of the blowout,

operations at Macondo were significantly behind schedule. BP had6 initially planned for the Deepwater Horizon to move to BP’s Nile well by

March 8, 2010. In large part as a result of this delay, as of April 20, BP’s

Macondo operations were more than $58 million over budget.

 Personnel changes and conflicts. BP experienced a number of problems

involving personnel with respo nsibility for operations at Macondo. A

reorganization that took place in March and April 2010 changed the roles

and responsibilities of at least nine individuals with some responsibility

for Macondo operations. In addition, the Panel found evidence of a

conflict between the BP drilling and completions operations manager and

the BP wells team leader and evidence of a failure to adequately delineate

roles and responsibilities for key decisions.

At the time of the blowout, both BP and Transocean ha d extensive

procedures in place regarding safe drilling operations. BP required that its

drilling and completions personnel follow a “documented and aud itable risk

management process.” The Panel found no evidence that the BP Macondo team

fully evaluated ongoing operational risks, nor did it find evidence that BP

communicated with the Transocean rig crew about such risks.

Transocean had a number of documented safety programs in place at the

time of the blowout. Nonetheles s, the Panel found evidence that Transocean

personnel questioned whether the Deepwater Horizon crew was adequately

prepared to independently identify hazards associated with drilling and other

operations.

Everyone on board the Deepwater Horizon was obligated to follow the

Transocean “stop work” policy that was in place on April 20, which provide d

that “[e]ach employee has the obligation to interrupt an operation to prevent an

incident from occurring.” Despite the fact that the Panel identified a number of

reasons that the rig crew could have invoked stop work authority, no individual

on the Deepwater Horizon did so on April 20.

The Panel found evidence that BP and, in some instances, its contractors

violated the following federal regulations:

 30 CFR § 250.107

– BP failed to protect health, safety, property, and the

environment by (1) performing all operations in a safe and workmanlike

manner; and (2) maintaining all equipment and work areas in a safe

condition;7  30 CFR § 250.300

– BP, Transocean, and Halliburton (Sperry Sun) failed to

take measures to prevent the unauthorized release of hydrocarbons into

the Gulf of Mexico and creating conditions that posed unreasonable risk

to public health, life, property, aquatic life, wildlife, recreation, navigation,

commercial fishing, or other uses of the ocean;

 30 CFR § 250.401

– BP, Transocea n, and Halliburton (Sperry Sun) failed to

take necessary precautions to keep the well under control at all times;

 30 CFR § 250.420(a)(1) and (2)

– BP and Halliburton failed to cement the

well in a manner that would properly control formation pressures and

fluids and prevent the release of fluids from any stratum through the

wellbore into offshore waters;

 30 CFR § 250.427(a)

– BP failed to use pressure integrity test and related

hole

‐ behavior observations, such as pore pressure test r esults, gas

‐ cut

drilling fluid, and well kicks to adjust the drilling fluid program and the

setting depth of the ne xt casing string;

 30 CFR § 250.446(a)

– BP and Transocean failed to conduct major

inspections of all BOP stack components; and

 30 CFR § 250.1721(a)

– BP failed to perform the negative test procedures

detailed in an application for a pe rmit to modify its plans.

Although the Panel found no evidence that MMS regulations in effect on

April 20, 2010 were a cause of the blowout, the Panel concluded that stronger

and more comprehensive federal regulations might have reduced the likelihood

of the Macondo blow out. In particular, the Panel found that MMS regulations in

place at the time of the blowout could be enhanced in a number of areas,

including: cementing procedures and testing; BOP configuration and testing;

well integrity testing; and other drilling operations. In addition, the Panel found

that there were a number of wa ys in which the MMS drilling inspections

program could be improved. For example, the Panel concluded that drilling

inspections should evaluate emergency disconnect systems and/or other BOP

stack secondary system functions. BOEMRE has already implemented many of

these improvements.8 This Report sets forth in detail the Panel’s investigative findings,

conclusions, and recommendations. The Panel’s findings and conclusions are

presented in the following subject areas: well design; cementing; possible flow

paths; temporary abandonment of the Macondo well; kick detection and rig

response; ignition source and explosion; the failure of the Deepwater Hor izon

blowout preventer; regulatory findings and conclusions; and company practices.

This Report concludes with the Panel’s recommendations, which seek to

improve the safety of offshore drilling operations in a variety of different ways:

 Well design. Improved well design techniques for wells with high flow

potential, including increasing the use of mechanical and cement barriers,

will decrease the chances of a blo wout.

 Well integrity testing. Better well integrity test practices (e.g., negative test

practices) will allow rig crews to identify possible well control problems in

a timely manner.

 Kick detection and response. The use of more accurate kick detection devices

and other t echnological improvements will help to ensure that rig crews

can detect kicks early and maintain well control. Better training also will

allow rig crews to identify situations where hydrocarbons should be

diverted overboard.

 Rig engine configuration (air intake locations). Assessment and testing of

safety devices, particularly on rigs where air intake loca tions create

possible ignition sources, may decrease the likelihood of explosions and

fatalities in the event of a blowout.

 Blowout preventers. Improvements in BOP stack configuration, operation,

and testing will allow rig crews to be better able to handle well control

events.

 Remotely

‐ op erated vehicles (ROVs). Standardization of ROV intervention

panels and intervention capabilities will allow for improved response

during a blowout.

The Panel believes that the adoption of the proposed recommendations

will improve the safety of offshore operations and will help to reduce the9 likelihood of the occurrence of another tragic event similar to the Macondo

blowout.10 

### I. Introduction

A. The Investigation

On April 27, 2010, the Secretaries of the Department of Homeland Security

and the Department of the Interior convened a joint investigation of “the

explosion and sinking of the mobile offshore drilling unit Deepwater Horizon ” 2 by

the Bureau of Ocean Energy Management, Regulation and Enforcement

(“BOEMRE”) and the United States Coast Guard (“USCG”). The Convening

Order directed the Joint Investigation Team (“JIT”) to issue a joint report within

nine months. This deadline was extended to allow the JIT to complete the

investigation.

On April 29, 2010, an MMS Associate Director appointed the MMS (now

BOEMRE) memb ers of the JIT. 3 This Report is based on the investigative record

developed by the JIT and contains the Panel’s findings and conclusions.

BOEMRE’s Investigations and Review Unit (“IRU”), in close coordination with

the Panel, had a substantial role in the drafting and preparation of the Report. 4

The Convening Order provides that relevant statutes and regulations

relating to both the USCG and BOEMRE govern the JIT and that the JIT’s public

hearings be conducted in accordance with the USCG’s rules and procedures

relating to Marine Boards of Investigation. Under these rules, the JIT was

required to formally designate certain companies and individuals involved wi th

the Deepwater Horizon operation at the time of the blowout as “parties in interest”

(“PIIs”) and also retained the authority to designate other PIIs at its discretion.

The JIT designated the following entities and individuals as PIIs: BP, Transocean,

Halliburton, MI

‐ SWACO, Weatherford, Anadarko Petroleum, MOEX USA Corp.,

Dril

‐ Quip, Jimmy Harrell (Transocean), Curt Kuchta (Transocean), Douglas

Harold Brown (Transocean), Steve Bertone (Transocean), Mike Williams

2 Joint Department of the Interior and Department of Homeland Security Statement of Principles

and Convening Order Regarding Investigation into the Marine Casualty, Explosion, Fire,

Pollution, and Sinking of Mobile Offshore Drilling Unit Deepwater Horizon

, with Loss of Life in

the Gulf of Mexico, April 21

‐ 22, 2010 (the “Convening Order”). By order of the Secretary of the

Interior, da ted June 18, 2010, BOEMRE replaced the former Minerals Management Service

(“MMS”) as the United States’ offshore resource manager and safety authority.

3 Panel members included David Dykes (co

‐ chair), Glynn Breaux, John McCarroll, Kirk

Malstrom, and Jason Mathews.

4 IRU members included Michael Farber, Lisa Scanlon, and Kishan Nair.11 (Transocean), Patrick O’Bryan (BP), and Robert Kaluza (BP). 5 Under the Marine

Board rules and other governing authorities, the PIIs possessed certain rights

relating to the investigation. 6

Under the Convening Order, the JIT was given the full investigative

authority of both the Department of the Interior and the Department of

Homeland Security. 7 The JIT held seven public hearings and heard testimony

from more than 80 witnesses. 8 Three witnesses whose testimony was sought by

the JIT invoked their Fifth Amendment rights against self

‐ incrimination and

refused to testify during the JIT hearings, and two other witnesses claimed they

were unable to testify for medical reasons. 9 In addition to the public hearings,

BOEMRE investigators also conducted interviews of more than 25 individuals

throughout the investigation.

The JIT collected and reviewed large volumes of electronic and written

material, including data, emails and other records related to the PIIs’ equipment,

management systems, supervision of employees and contractors,

communications, performance and training of personnel, relevant company

policies and practices, and work environment. The JIT issued mor e than 90

subpoenas for documents and other information and collected over 400,000

pages of evidence.

During the course of the investigation, the JIT commissioned several

entities and qualified individuals to conduct expert analyses of evidence. Dr.

John Smith, a petroleum engineer with Petroleum Consulting LLC, reviewed

5 At the request of the Republic of the Marshall Islands, the JIT designated it as a “Substantially

Interested State.” The Deepwater Horizon was a foreign

‐ flagged vessel that, at the time of the

blowout, was flagged under the Republic of the Marshall Islands.

6 See 46 U.S.C. § 6303; 46 CFR. §§ 4.03

‐ 10, 4.07

‐ 35, 4.09

‐ 15.

7 Convening Order, at 1.

8 Retired United States District Judge Wayne Andersen, who served without compensation,

joined the JIT in August 2010 to preside over subsequent hearings. BOEMRE is grateful for Judge

Andersen’s assistance during the hearings and in meetings with counsel for the PIIs.

9 Brian Morel and Robert Kaluza each invoked his Fifth Amendment Rights and refused to testify

during JIT hearings. After testifying at one hearing, Mark Hafle invoked his Fifth Amendment

Rights and refused to testify a second time. Through his attorney, Donald Vidrine claimed that

he could not testify due to medical re asons. Each of these four individuals was a BP employee at

the time of the blowout and continues to be employed by BP. In addition, two Transocean

witnesses declined to cooperate with the investigation, citing technical reasons for their decisions

not to testify. Transocean declined to encourage these witnesses to cooperate with the

invest igation.12 well condition data collected by Sperry

‐ Sun during the temporary abandonment

procedure and reports prepared by the International Association of Drilling

Contractors (“IADC”) to help reconstruct and identify key issues during the 24

hours immediately prior to the blowout. Keystone Engineering conducted a

casing buoyancy analysis. 10 Oilfield Testing and Consulting conducted a cement

blend analysis on samples provided by Halliburton. Det Norske Veritas

(“DNV”) conducted the forensic examination of the Deepwater Horizon ’s BOP

stack and sections of drill pipe and provided a forensic analysis report detailing

the information and conclusions developed based on this examination. 11 These

expert reports are attached as appendices to this Report.

The purpose of this investigation was to identify the causes of the

Macondo blowout and issue recommendations in order to reduce the likelihood

of a similar event in the future. Throughout this report, the Panel classifies the

factors that contributed to the blowout in the following categories:

 Causes are those factors that most immediately and proximately caused

the blowout; that most directly le d to the circumstances underlying the

blowout; or that allowed the blowout to happen. But for these factors,

there would not have been a blowout. These factors may be specific

events or conditi ons that existed in the well or on the rig at the time of the

blowout.

 Contributing Causes are those factors that alone would not have led to

the blowout, but that were significant in contributing to the events or

conditions that gave rise to the blowout. For a factor to be classifie d as a

contributing cause of an event, there must be compelling evidence

supporting both the existence of the factor and that it materially

contributed to the occurrence or severity of the event.

 Possible Contributing Causes are those factors that either were minor

contributing causes of the blowout or for which the evidence sugge sts the

factor’s contributing role in the blowout is weaker or less compelling.

10 The casing buoyancy analysis evaluated whether the production casing floated up the wellbore

a result of the blowout.

11 As discussed in more detail later in this report, a BOP stack is a large device that sits on top of a

well and is designed to assist rig crews in maintaining control of the well. Various BOP stack

components can be manually or automatically operated to seal the well and protect ag ainst a

blowout. The central issue investigated by the JIT regarding the Deepwater Horizon BOP was why

the BOP failed to stop the flow of hydrocarbons from the Macondo well.13 B. Background Regarding Deepwater Drilling in the Gulf of

Mexico

The goal of deepwater drilling operations is to locate and extract oil and

gas (collectively referred to as “hydrocarbons”) from reservoirs located beneath

the sea floor. In some reservoirs, the hydrocarbons become trapped beneath

impermeable rock; when this happens, the hydrocarbons seep into surrounding

porous rock. Drilling operations seek to penetrate the impermeabl e rock to get to

hydrocarbon

‐ bearing reservoirs or “pay zones.”

The Gulf of Mexico is home to a large number of hydrocarbon reservoirs.

Since 1947, more than 50,000 wells have been drilled in the U.S. Gulf of Mexico.

Approximately 97% of the oil pro duced on the U.S. Outer Continental Shelf

(“OCS”) is produced in the U.S. Gulf of Mexico. There are currently nearly 7,000

active leases in the U.S. Gulf of Mexico, 64% of which are in deepwater. 12

Since 1995, deepwater drilling activity has increased significantly in the

Gulf. In 2001, U.S. deepwater offshore oil production surpassed shallow water

offshore oil production for the first time. As of May 2010, operators drilled

approximately 700 wells in water depths equal to or greater than 5,000 feet, the

approximate depth of the Macondo well. 13 Deepwater reservoirs can yield a high

volume of oil and gas. Production rates for deepwater wells are typically much

higher than in shallow water wells.

The initial well or wells drilled into a formation are referred to as

“exploratory wells,” which an operator drills to determine whether a reservoir

contains sufficient volumes of hydrocarbons to warrant investment in the

12 See Department of Interior, Increased Safety Measures for Energy Development on the Outer

Continental Shelf, (May 27, 2010). Although there is no single accepted definition of

“deepwater,” a common use of the term is to refer to locations where the water depth is at least

1,000 feet.

13 Id

. “Operators” are the persons the lessee(s) designates as having control or management of

operations on the leased area or a portion thereof. An operator may be a lessee, the MMS

‐ approved designated agent of the lessee(s), or the holder of operating rights under an MMS

‐ approved operating rights assignment. “Lessee” means a person wh o has entered into a lease

with the United States to explore for, develop, and produce the leased minerals. The term lessee

also includes the MMS

‐ approved assignee of the lease, and the owner or the MMS

‐ approved

assignee of operating rights for the lease. 30 CFR § 25 0.105.14 installation of equipment required for production. At this stage, the operator

may have limited information about the geological characteristics of the reservoir

and surrounding formations. Such information, including data about the

surrounding formations, pore pressures, 14 reservoir configuration and reservoir

volumes, is developed during the exploratory drilling operation and may lead to

changes in the drilling plan and well design as the operation proceeds.

Once an operator finishes drilling an exploratory well and performing its

initial evaluation of the well, it typically seals the well by pumping cement and

installing mechanical plugs. This procedure is commo nly referred to as

“plugging and abandoning” the well. If the operator believes that it eventually

will be able to produce hydrocarbons from the exploratory well, it may choose to

perform “temporary abandonment” procedures, which are procedures that allow

the drilling rig to move off of the well so that the operator can return at a later

date to complete the well and prepare it for production.

A typical deepwater well is drilled using the following process:

 A drilling ri g moves on the location of the well. Many rigs operating in

deepwater are “dyna mically

‐ positioned,” which means that they are not

moored to the seafloor but instead hold their position over the well

through a combination of satellite technology and directional thruster

activity. The Deepwater Horizon was a dynamically

‐ positioned rig.

 The rig lowers drill pipe (also known as a drill string) with a drill bit

attached to its end. The drill bit bores into th e sea floor and the subsea

formation to make a hole. That hole is referred to as the wellbore.

 The rig installs, or “sets,” a large

‐ diameter pipe known as “casing” into

the wellbore to establish a barrier between the wellbore and the

surrounding formation and to ensur e that continued drilling does not

result in the collapse of the wellbore. The initial casing that is set in the

wellbore is called “conductor” casing.

 The rig then uses the “marine riser” or “riser,” which is a large pipe that

surrounds the drill pipe, to lower the subse a BOP stack onto the well.

The subsea BOP is latched to the wellhead on the conductor casing.

14 “Pore pressure” is the pressure of fluids within the pores of a reservoir.15  As drilling progresses, the rig sets additional casings (sections of pipe)

that are slightly smaller in diameter than the hole created by the drill bit.

The combination of casings is referred to as the “casing string.” The

casings are bonded into place using cement. The casing string maintains

the integri ty of the wellbore by protecting the sides of the wellbore from:

(1) pressure exerted from the drilling mud; (2) collapse of the hole already

drilled; and (3) influx of fluids from the surrounding formation.

 The outermost casing near the top of the well can be up to four fe et in

diameter, and the innermost string of casing near the bottom of the well

can be less than six inches in diameter. The size of the initial and final

casing, the types of casing, and the type of cement used are determined

by the profile of the well being dr illed, including factors such as well

depth, temperatures, and well pressures. Once the well is in production,

hydrocarbons are extracted through a tubing string that is run down

through the middle of the production casing string.

During drilling, the rig crew pumps a fluid, called “drilling mud” or

“mud” down the drill pipe and through the drill bit nozzles. Although the fluid

is referred to as “mud,” it is actually a complex system comprised of components

that are de signed in light of, and tailored to, a variety of well conditions. The

mud’s primary function is to assist drill crews in maintaining well control.

Drilling mu d exerts hydrostatic pressure in the drill pipe and annulus (the space

between the drill pipe and the walls of the casing strings or open hole) that is

equal to or greater than the pressures encountered in the wellbore, thereby

keeping the well balanced and under control. Drilling mud also cools the drill

bit and lifts cuttings to the surface as the mu d is circulated during drilling. 15 By

closely monitoring well pressure, rig crews maintain the wellbore fluid pressure

so that it is equal to or slightly greater than the pressures from the formation.

This type of pressure balance is referred to as an “overbalanced” condition. By

contrast, a well is in an “underbalanced” condition when the formation press ures

exceed the wellbore drilling fluid pressures. Rig crews rely upon a number of

indicators to track fluid pressures. 16

15 Operators routinely rely upon drilling mud suppliers to provide assistance with choosing an

appropriate drilling mud. Drilling rig crews include “mudloggers” who monitor drilling mud,

wellbore pressures, and other data.

16 This process of monitoring well pressures is referred to as “measurement while drilling.”

Operators also routinely rely upon drilling mud suppliers to provide assistance with choosing an

appropriate drilling mud and to provide “mudloggers” on the rig to monitor drilling mud,

wellbore pressures, and other data.16 Cementing is an important factor in well design and the execution of a

safe drilling program. After each casing string is set, cement is pumped down

the drill string, out the bottom of the casing and back up into the annular space.

The cement reinforces the casing string and seals off the annular space,

preventing hydrocarbons from fl owing through the space. A properly cemented

annular space is said to have achieved “zonal isolation.” Operators often work

with contractors that possess specific cementing expertise to develop the optimal

type of cement for a particular drilling operation. Cementing companies also can

help model different anticipated well conditions to hel p drilling engineers to

design a successful cement job. There are a number of different tests that can be

performed to assess the quality of a cement job.

During the drilling process, pockets of oil, natural gas, or water that are

encountered in porous layers of the formation can exert pressure into the

wellbore that may suddenly force mud back up the wellbore with considerable

force

– this is commonly referred to as a “kick.” To handle kicks and to maintain

well control, drilling c rews use various mechanisms, including, under extreme

circumstances, activation of the BO P stack and diverters. If a kick overwhelms

the control mechanisms, a blowout

– the uncontrolled flow of hydrocarbons

through the wellbore

– can occur.

C. Companies Involved in the Macondo Well

BP and Transocean were the primary companies involved in drilling the

Macondo well. BP was the majority owner and designated operator of the lease.

BP identified the pros pect and designed and planned the well. Transocean was

the drilling contractor engaged by BP to drill the Macondo well and provide the

Deepwater Horizon

, a dynamically

‐ positioned, mobile offshore drilling unit (“DP

MODU”), as well as the drilling personnel.

 BP is a glo bal oil and gas company headquartered in London, England.

BP operates in more than 80 countries and is involved in oil and gas

exploration, production, and refining, as well as the operation of

service stations worldwide. BP holds more than 500 active leases in

the Gulf of Mexico, more than any other lessee. From 2005 through

2009, BP was the leading producer of oil and gas in the Gulf of Mexico,

producing 559,336,436 barrels of oil and 846,352,047 MCF (thousand

cubic feet) of gas during that period.17  Transocean is the world’s largest offshore drilling contractor. Based in

Switzerland, Transocean owns more than 140 drilling rigs and operates

in the major offshore oil and gas fields in the world. Transocean has

grown substantially through a series of corporate acquisitions,

including the acquisition of Reading & Bates Falcon (R&B Falcon) in

2000 and Global Santa Fe in 2007. Transocea n owned the Deepwater

Horizon rig, which was under a long

‐ term lease to BP at the time of the

Macondo blowout. The lease agreement required Transocean to

manage and operate the Deepwater Horizon on behalf of BP.

Offshore drilling oper ations are complex and normally involve the work

of many different specialists. In addition to BP, the leaseholder and the

designated operator of the Macondo well, and Transocean, the following

companies also had significant roles in the operation:

 Halliburton

, which provides products and services to the energy

industry worldwide and is one of the world’s largest ce menting

contractors to the oil and gas industry, provided cement planning,

products, and services at Macondo.

 Anadarko E&P Company LP, Anadarko Petroleum Corporation and

MOEX were BP’s partners in the Macondo well. Anadarko E&P

Company LP owned 22.5%, and Anadarko Petroleum Corporation

owned 2.5%. 17 Both Anadarko companies are U.S. oil and gas

exploration companies. 18 MOEX Offshore 2007, a Japanese oil

exploration firm, owned a 10% share of the well. 19 The companies

shared in BP’s costs to drill the Macondo well and would have shared

in any profits from the well.

 Cameron

, which is a Texas

‐ based manufacturer of oil and gas pressure

control equipment, manufactured the Deepwater Horizon ’s BOP stack.

 MI

‐ SWACO

, which provides drilling suppli es and services

worldwide, developed the mud program and provided drilling mud

and personnel to operate the Deepwater Horizon rig’s mud system.

17 BP-HZN-MBI-00192559.

18 BP

‐ HZN

‐ MBI

‐ 00177777.

19 Id.18  Schlumberger

, which provides oil field services throughout the world,

provided well logging services for the Macondo well.

 Sperry Drilling (Sperry

‐ Sun)

, a subsidiary of Halliburton that

provides drilling data systems and personnel to the drilling industry,

equipped the Deepwater Horizon with Sperry data sensors and Sperry

mudloggers to monitor and evaluate well conditio n data. The

Deepwater Horizon was also outfitted with Transocean paddle flow

meters to monitor flow.

 Weatherford

, which provides a variety of drilling services and

components, provided the casing, casing centralizers, and float

conversion equipment used on the Deepwater Horizon

.

D. The Deepwater Horiz on

The Deepwater Horizon was a deepwater, column

‐ stabilized, semi

‐

submersible DP MODU, designed to drill subsea wells for oil and gas

exploration and development. The Deepwater Horizon was built for R&B Falcon

(which later became part of Transocean) by Hyundai Heavy Industries in Ulsan,

South Korea. Construction started in December 1998, and the rig was delivered

on February 23, 2001, after Transocean acquired R&B Falcon. At th e time of the

blowout, the Deepwater Horizon was registered in Majuro, Marshall Islands, and

leased to BP.

The Deepwater Horizon’ s day rate at the time of the blowout was $533,495

and the rig’ s total estimated daily operating costs were approximately $1

million. 20 As is common in the industry, under its contract with BP, Transocean

was allowed a specific amount of time (in this case, up to twenty

‐ four hours per

calendar month) for mechanical downtime to perform maintenance and repairs

with a maximum accumulation of 12 days of downtime per year. 21 Transocean

was not paid its day rate if the rig was not operational due to equipment repairs

for time periods beyond this allotment. 22

20 TRN

‐ USCG_MMS

‐ 00040941.

21 TRN

‐ USCG_MMS

‐ 00040482.

22 Id.19 E. The Macondo Well

BP acquired Lease OCS

‐ G 32306 in an MMS Central Gulf of Mexico lease

sale on March 19, 2008. This lease covers 5,760 acres and extends for 10 years,

beginning on June 1, 2008. BP is the designated lease operator and shares

ownership of the lease with Anadarko and MOEX.

The Macondo well is located approximately 48 miles fr om the nearest

shoreline, 114 miles from the shipping supply point of Port Fourchon, Louisiana,

and 154 miles from the Houma, Louisiana helicopter base. BP began drilling the

Macondo well (referred to as “spudding” the well) on October 7, 2009, using

Transocean’s Mar ianas rig. After the Marianas sustained damage during

Hurricane Ida in November 2009, BP moved the Deepwater Horizon to the

Macondo well. The Deepwater Horizon crew resumed drilling operations at

Macondo in February 2010.

BP and Transocean experienced several challenges in drilling the

Macondo well. In Oc tober 2009, the well experienced a kick during drilling

operations. 23 The drilling crew experienced another kick on March 8, 2010. As a

result of the March 8 kick, the drill pipe became stuck in the wellbore, and the rig

crew could not pull the pipe free. 24 The crew, therefore, had to sever the drill

pipe and drill a bypass around the portion of the well with the stuck pipe. 25 The

well also experienced several “lost return” incidents during drilling, when

drilling mud pumped down the wellbore did not return to the surface as

expected because some volume of the mud flowed into and was lost in the

formation. 26 Lost returns are not uncommon and can occur for a variety of

reasons, such as a fracture in the formation or drilling in overbalanced

conditions. 27 Because of these and other challenges, on April 20, 2010, the

Macondo well was about 38 days behind schedule and approximately $58

million over the original budget. 28

23 MC 252 Well Activity Report, 10/25/2009.

24 IADC Reports, 3/8/10

‐ 3/12/10.

25 A bypass is a secondary wellbore drilled away from the original hole. It is not uncommon for

an operator to drill a bypass while experiencing problems during the drilling of a well.

26 IADC Reports, 3/8/10

‐ 3/12/10.

27 As discussed throughout the Report, the lost returns at the Macondo well were of note because

of their frequency and because they occurred along with other anomalies.

28 BP

‐ HZN

‐ MBI

‐ 00125958; BP

‐ HZN

‐ MBI

‐ 0019553; BP

‐ MB

‐ HZN

‐ 00192599.20 Despite these problems, by April 14, the Deepwater Horizon crew

successfully drilled to the M “56” sand, one of the hydrocarbon

‐ bearing zones

that BP geologists and engineers had targeted for the well. 29 Although the

original well plan was to drill approximately 1,800 additional feet, the BP drilling

team in Houston opted to stop drilling the well at a total depth of 18,360 feet

because BP believed the well had reached the base of the target reservoir and that

it had run out of drilling margin. 30 In other words, BP concluded that it could no

longer safely drill into the formation without creating an underbalanced well (if

the mud was too light) or risking fracturing the formation and threatening well

integrity (if the mud was too heavy). BP planned to run production casing and

temporarily abandon Macondo by sealing it with a surface cement plug so tha t

another rig could return to the well later and take the steps necessary to complete

the well for production.

On April 19, the Deepwater Horizon crew ran the production casing string

into the well. 31 BP’s engineering team had engaged in significant debate over the

appropriate design of the casing to run in the final well section. There was

additional debate among BP personnel about the number of centralizers, which

are pieces of equipment used to keep the casing centered in the well, to use on

the final casing string. The crew pumped ce ment into the annulus and into the

shoe track, the section of the casing between the bottom of the well and the float

valve installed in the well (a large valve designed to allow fluids to flow down

the well while preventing fluids from flowi ng back up the wellbore during

cementing operations).

The purpose of the cement job was to establish an isolation barrier across

the hydrocarbon zone at the bottom of the well so that hydrocarbons could not

enter the well. In the late hours of April 19 and into the morning of April 20, the

rig crew and BP’s cement contractor, Halliburton, pumped cement into the

Macondo well to isolate the hydrocarbon zones. 32 Based on data provided by BP,

Halliburton designed the cement slurry, which is a mixture of cement, water and

29 BP

‐ HZN

‐ MBI

‐ 00126338.

30 Id

. As discussed in detail later in this Report, drilling margin is the difference between the

weight of the mud used to drill relative to the pore pressures and the fracture gradient of the

formation. Common industry practice is to use a drilling margin of 0.5 ppg mud weight under

the fra cture gradient.

31 IADC Report 4/19/10.

32 Halliburton Post Job Cement Report, BP

‐ HZN

‐ CEC011406.21 assorted dry and liquid additives

. 33 After BP approved the design, Halliburton

began pumping the cement.

In addition to cementing, the process of preparing a well for temporary

abandonment includes further procedures to secure the well so that the rig’s BOP

stack and riser can be removed as the rig prepares to move off the location. BP

engineers in Houston developed temporary abandonment procedures (different

from the MMS

‐ approved procedure) for the Macondo well that included the

following st eps: performing a positive pressure test; 34 displacing mud in the well

from 8,367 feet to the wellhead; performing a negative pressure test; 35 setting a

300

‐ foot cement plug in the well approximately 3,300 feet below the sea floor and

setting a lock

‐ down sleeve to lock the final casing into place. 36 BP engineers

changed the order of these steps several times in the days before the temporary

abandonment.

During all well activities, including temporary abandonment, crew

members monitor various sensors on the rig that show fluid volumes and well

pressures. 37 These sensors provide real time data to the crew, which monitors

and analyzes the data on electronic displays to identify potential kicks, among

other things. Early kick detection is critical to maintaining well control.

On April 20, the crew conducted tests to evaluate the integrity of the

production casing cement job. The tests wer e based on MMS

‐ approved

procedures that a BP drilling engineer had sent to the rig that morning. 38 The

crew first conducted a positive pressure test to evaluate whether the well casing

could sustain pressure exerted on it from the inside of the well and received

favorable results. 39 On the same afternoon, the crew circulated mud up from the

33 Additives are used to tailor the cement to the needs of a well. For example, a weighting

material might be added to a cement slurry when a higher density cement is needed.

34 A positive pressure test is conducted by pumping fluid into the well after sealing the blind

shear rams. The rig crew monitors the well to determine whether pressures in the well remain

static.

35 A negative pressure test seeks to create conditions that simulate what will occur when the well

is abandoned. The rig crew displaces drilling mud with other fluids, resulting in the wellbore

being underbalanced against the formation pressures. The rig crew then monitors pressures and

flow to determine the integrity of the ba rrier being tested.

36 BP

‐ HZN

‐ MBI

‐ 00129108. Each of these steps is discussed in detail in Section I of the findings

and conclusions in this Report.

37 Fluid includes any fluid (mud, spacer, seawater) coming out of the well or across the rig.

38 BP –HZN

‐ MBI

‐ 00021237.

39 BP

‐ HZN

‐ MBI

‐ 00136947.22 well, and pumped the recovered mud onto the Damon Bankston

, a vessel working

alongside the Deepwater Horizon at Macondo. Because of the movement of the

mud, it was difficult for the crew to track fluid volumes in the wellbore and in

the mud pits on the rig. 40

Next, crew members turned to conducting negative pressure tests on the

well, which would give the crew information about whether the production

casing cement job was capable of keeping hydrocarbons out of the wellbore. The

crew ran two separate negative tests using different procedures for each test.

Just prior to 8:00 p.m. on April 20, the BP well site leader on duty on the rig,

Donald Vi drine, and Transocean crew members concluded that the second

negative test showed that the final cement job was successful. 41 Vidrine also

called Mark Hafle, a BP engineer in Houston, around 8:50 p.m. to discuss the

surface plug. During this call, Vidrine described the results of the negative tests.

Hafle questioned Vidrine about the results of the negative test, but he chose not

to investigate further by accessing and reviewing the a vailable real

‐ time data.

Instead, Hafle chose to rely upon Vidrine’s assurance that the rig crew had

successfully performed a negative test. 42

During the evening of April 20, the Deepwater Horizon crew continued

with the temporary abandonment procedure by opening the BOP and pumping

seawater down the drill pipe to displace mud and a spacer from the riser. 43

During these well activities, the well experienced significant changes in pressure.

Personnel responsible for monitoring the condition of the well, however, did not

recognize these changes as signs of a kick. The crew members shut down the

well around 9:15 p.m. to perform a sheen test on the spacer that they planned to

send overboard as it was displaced from the well. 44 The decision to send the

displaced spacer overboard rendered Sperry Sun personnel unable to measure

returns on one of the rig’s flow meters. Due to the placement of the flow meters,

40 BP

‐ HZN

‐ MBI

‐ 00021238.

41 Testimony of Jimmy Harrell, Joint Investigation Hearing, May 27, 2010, at 90

‐ 91; Testimony of

Miles Ezell, Joint Investigation Hearing, May 28, 2010, at 279

‐ 282.

42 BP

‐ HZN

‐ BLY00125470.

43 “Spacer” refers to material that rig crews pump into a well to separate the drilling mud from

seawater. Displacement of mud and spacer are part of the temporary abandonment procedures

discussed in detail in Section IV of the findings and conclusions.

44 Sperry

‐ Sun rig data, April 20, 2010. The crew performed a sheen test to confirm that all of the

oil

‐ based mud had been displaced from the riser. A “sheen test” is intended to indicate the

presence of free oil when drilling fluid, drilled cuttings, deck drainage, well treatment fluids,

completion and workover flu ids, produced water or sand or excess cement slurry are discharged

into offshore waters.23 the Sperry Sun crew could only measure returns sent to the mud pits and could

not measure flow volumes sent overboard. 45

F. The Blowout

On April 20, 2010, at around 9:40 p.m., powerful pressures from the well

caused mud to flow up from the well. Mud spilled on the rig floor as the well

began to blowout. The crew responded to the situation by diverting the flow to

the mud gas separator, part of the diverter system to which the crew could direct

fluids comi ng up from the well. 46 At this time, crew members likely realized that

they had lost control of the well and attempted to regain control of the well by

activating the BOP stack’s upper annular preventer and the upper variable bore

ram. 47

The mud

‐ gas separator, to which the crew had diverted flow from the

well, was quickly overwhelmed and failed, causing a gas plume to fill the rig

floor. The gas quickly ignited, causing the first explosion on the rig at 9:49 p.m.

Approximately ten seconds later, a second larger explosion occurred and the fire

onboard the rig spread rapidly. Shortly afte r the second explosion, the rig lost

power and experienced a total blackout.

At approximately 9:56 p.m., the rig’s subsea engineer attempted to

activate the BOP stack’s emergency disconnect system from the BOP panel on the

rig’s bridge. The emergency disconnect system is desig ned to activate the BOP

stack’s blind shear ram and disconnect the rig’s lower marine riser package

(“LMRP”) from the well. The BOP panel apparently indicated that the

emergency disconnect system was activated, but the rig remained connected to

the well and hydrocarbons continued to flow uncontrolled from the well. 48

About four minutes after the attempt to activate the emergency disconnect

system, personnel on the Deepwater Horizon ’s bridge manually sounded the

general alarm and made a muster call for personnel to gather at designated

45 Testimony of Joseph Keith, Joint Investigation Hearing, December 7, 2010, at 135.

46 The mud gas separator, and the rig crew’s decision to use it to handle the influx of

hydrocarbons from the well, is discussed in detail in Section V

‐ D of the findings and conclusions.

47 DNV, Forensic Examination of Deepwater Horizon Blowout Preventer

, March 20, 2001, (DNV

Report) at 4. As discussed in later in this Report, the upper annular preventer and the upper

variable bore ram are two BOP stack components that are used by rig crews in well control

events. Neither component, however, is designed to shear the drill pipe an d completely seal the

well

– the blind shear ram on the BOP stack is designed to perform these functions.

48 Testimony of Chris Pleasant, Joint Investigation Hearing, May 28, 2010, at 123.24 lifeboat stations. Personnel, including crew members, contractors and visiting

executives from BP and Transocean, evacuated the rig on two lifeboats and a life

raft. At least six people jumped from the rig into the water.

At 10:00 p.m., the Damon Bankston

, which prior to the explosions had been

directed by the Deepwater Horizon to move 500 meters aw ay from the rig,

received distress calls from the Deepwater Horizon and prepared its fast recovery

craft for launch and rescue of those who had abandoned the rig. The Damon

Bankston retrieved six people from the water and recovered another 108 people

from the two lifeboats and life raft. Uncontrollable fires continued to blaze on

the Deepwater Horizon

, and the rig sank on the morning of April 22.

Eleven men died as a result of the blowout and sixteen others were

injured. Estimates are that the Ma condo well spilled close to five million barre ls

of oil into the Gulf of Mexico during 87 days between the blowout and when the

well was successfully capped on July 15, 2010. After months of additional

intervention work, the well was permanently sealed on September 19, 2010.25 

### II. Well Design

Well design is a fundamental and important phase of offshore drilling

operations. Operators must consider site

‐ specific factors, including flows,

pressurized formation flows, reservoir natural gas and oil type, reservoir

lithology (formation characteristics), reservoir structure, and the anticipated

volume of hydrocarbons to determine the best way to drill to the target reservoir

and to conf igure casing to allow production from the well. During the design

process, engineers use all available data to determine planned total depth

(sometimes referred to as “TD”) of the well, casing point selections, required

casing specifications, casing pressure ratings, cement slurry design, mud weight,

and risk factors particular to the well. 49

Development wells are typically designed and drilled based in part on

data from nearby wells, referred to as offset well data. In the case of exploratory

wells, such as Macondo, operators have limited offset well data available,

making it more difficult to anticipate well conditions prior to the spud of the

well. As a result, design processes in explor atory wells are subject to change.

Operators typically deal with well design changes during drilling operations

through documented “management of change” processes, which are intended to

aid personnel in systematically identifying and mitigating the risks associated

with the changes.

The BP well engineering team and the BP subsurfa ce team were involved

in developing the Macondo well design. The teams referred to various

documents and manuals while designing the Macondo well, including BP’s

internal casing design manual, drilling well operations policy (“DWOP”),

advanced guidelines for deepwater drilling and other guidance. 50

A. Cost of the Macondo Well

BP exceeded its original cost estimates for drilling the Macondo well. To

obtain additional funds and continued participation from its partners in the

Macondo project, BP submitted to Anadarko E&P Company LP and Anadarko

Petroleum Corporation (collectively “Anadarko”) and MOEX several

49 Casing point is the depth at which drilling a particular wellbore diameter will end so that

casing of a given size can be run and cemented.

50 BP

‐ HZN

‐ MBI000010362.26 Authorizations for Expenditures (“AFEs”), which included written descriptions

of the project and cost estimates for proposed well activities and operations. 51

Under their operating agreement with BP, Anadarko and MOEX could

choose to participate in the activities and operations described in the AFE and

thereby commit to the funding necessary to continue the operation; they could

propose an alternative operating plan; or they could end their participation in the

Macondo project. 52

BP submitted to Anadarko and MOEX an initial AFE for the Macondo

well in August 2009, estimating that the total costs of the well would be about

$96.1 million. Both Anadarko and MOEX approved the operation and

expenditures. 53 BP sought its first supplemental AFE for approval of an

additional $27.9 million in January 2010, which the partners accepted in February

2010. 54 In March 2010, BP sought authorization for an additional $27 million,

explaining that it had exceeded the first supplemental AFE due to unexpected

lost circulation and well control events. 55 Anadarko and MOEX approved the

expenditure and offered no alternative operating plan. 56

On April 14, after BP had drilled to the Macondo well’s revised target

depth, it sought a final AFE for $3.5 million to fund setting the production casing

in connection with the temporary abandonment of the well. Anadarko and

MOEX approved the AFE and did not propose any alternative operating pla n. 57

In total, the companies allocated $154.5 million to drilling the Macondo

exploratory well, an amount well in excess of the original estimated cost of

$96.16 million and the not

‐ to

‐ exceed cost of $139.5 million.

Under their operating agreement with BP, Anadarko and MOEX had

access to, and in fact reviewed, data and file s related to the Macondo well that BP

made available to them through shared websites. The Panel found no evidence,

other than reviewing this information and approving the AFEs, indicating that

51 BP

‐ HZN

‐ MBI000173275.

52 BP

‐ HZN

‐ MBI

‐ 00173275.

53 BP

‐ HZN

‐ MBI00192546, BP

‐ HZN

‐ MBI00192549.

54 BP

‐ HZN

‐ MBI00192552, BP

‐ HZN

‐ MBI00192553.

55 BP

‐ HZN

‐ MBI00192557.

56 BP

‐ HZN

‐ MBI00192558.

57 BP

‐ HZN

‐ MBI00192559, BP

‐ HZN

‐ MBI00192561.27 Anadarko or MOEX were directly involved in decisions related to the design or

drilling of the Macondo well. 58

B. Drilling Margin

Drilling engineers must design a well to manage pore pressure and

fracture gradients at different well depths. Pore pressure is the pressure exerted

by fluids in the pore space of the formation being drilled. Fracture pressure is

the point at which pressure exerted by the drilling fluid in the well would cause

the surrounding form ation to fracture. The fracture gradient plot, expressed as a

calculated equivalent mud weight, is a curve that shows the well’s estimated

fracture gradient by depth. During well design, engineers typically use a

graphical representation of the estimated pore pressure, mud weight, and

fracture gradient, which together define the appropriate drilling margins.

Drilling engineers conduct a “leak

‐ off” test to determine the strength or

fracture pr essure of the open formation. This test is us ually conducted

immediately after drilling past the cemented casing shoe in the well. 59 During

the test, the well is shut in and fluid is pumped into the wellbore to gradually

increase the pressure that the formation experiences. At a certain pressure, fluid

pumped into the well will enter the formation, or leak

‐ off, by moving through

permeable paths in the rock or by creating a space by fracturing the rock. If the

pressure is increased beyond the f ormation fracture point, fracturing of the

formation can occur. The results of the leak

‐ off test dictate the maximum

pressure or mud weight that may be applied to the well during drilling

operations before the formation can be expected to take fluid.

BOEMRE regulations require that “[w]hile drilling, you must main tain the

safe drilling margin identified in the approved APD [Application for Permit to

Drill]. When you cannot maintain this safe drilling margin, you must suspend

drilling operations and remedy the situation.” 60 Safe drilling margin can be

maintained by ensuring that the mud weight remains between the “kick

tolerance” or “kick margin,” which is typically 0.5 pounds per gallon (“ppg”)

58 Data obtained from Halliburton showed that representatives of Anadarko and MOEX

periodically reviewed information related to the Macondo well during drilling.

59 The “casing shoe” is a short steel collar that is typically attached to the bottom of the casing

string. It helps to establish proper positioning of the casing string in the wellbore.

60 30 CFR § 250.427(b). BOEMRE regulations do not specify what a “safe drilling margin” is.

There may be instances where a safe drilling margin can be maintained outside the “kick” or

“swab” margins.28 below the fracture gradient, and the “swab” margin, which is typically 0.2 ppg

above the pore pressure. In short, the mud must be heavy enough to control the

pore pressure and ensure that the formation fluids (including hydrocarbons) do

not enter the wellbore, while not so heavy that it fractures the for mation. 61

BOEMRE regulations require operators to provide various data to the

Agency demonstrating that the operator is maintaining a safe margin. For

example, operators must show, in a single graphic plot, pore pressures, mud

weights and fracture gradients for the full extent of the well. 62 The plotted data

reflects forecasted data based on 3D seismic and offset well data. 63 When

operators encounter unexpected pressures that differ from their forecasts,

applicable regulations require the operator to revise its casing design and apply

to the Agency for approval of the modification. 64

The final estimated Macondo well pore pressure, mud weight, and

fracture gradient plot submitted to MMS on March 26 is shown at Figure 1. The

vertical axis of Figure 1 shows the depth of the well. The horizontal axis shows

the mud weight. The red line depicts BP’s planned mud weight, which was

designed to be betwe en the kick margin and the swab margin identified in

Figure 1.

61 Maintaining mud weight in this range is an industry

‐ accepted practice but is not specifically

required by BOEMRE regulations.

62 30 CFR §§ 250.413 and 414.

63 “Off

‐ set well data” are data obtained from wells that are drilled in an area close to the target

well.

64 30 CFR § 250.427(b).29 Figure 1

– Macondo Well Pore Pressure Fracture Gradient Plot 65

As seen in Figure 2, the formation integrity test at the 9

‐ 7/8 inch liner shoe

located at 17,168 feet yielded results of 15.98 ppg (as identified in the IADC daily

reports, which are completed by the rig crew to document daily operations) and

16.22 ppg (identified in BP’s Daily Operation Report). The Panel found that th is

integrity test may have created uncertainty because (1) it was 1.0 ppg higher than

anticipated and (2) there was a possibility that the test results did not reflect a

true test of the formation below the 9

‐ 7/8 inch liner shoe. Although this fracture

gradient te st was questionable, BP chose not to retest the fracture gradient at the

shoe and decided to drill ahead. After drilling the M57C sand interval, BP

65 API 608174116901, March 26 APD (Revised Bypass) for the Macondo Well.30 conducted a Geotap survey to determine the sand pore pressure. The sand pore

pressure was determined to be 14.15 ppg. BP also converted this pore pressure

to an estimated fracture gradient of 15.0 ppg. The open

‐ hole section drilled

utilized a surface mud weight range of 14.1–14.5 ppg, which allowed for a safe

drilling margin to be maintained between pore pressur e and fracture gradient.

Throughout this interval, however, BP encountered multiple problems

associated with both lost returns and regressing pore pressures (1.9 ppg

difference) between 17,001 and 18,066 feet. BP lost approximately 4,000 barrels

(“bbls”) of mud in the production open

‐ hole interval. BP utilized loss circulat ion

material in this interval to attempt to control these losses.

Figure 2

‐ Drilling margin data from IADC reports and BP Daily Reports

BP continued drilling until it concluded it had run out of drilling margin

between mud weight and formation pore pressure. Ro bert Bodek, BP Geological

Operations Coordinator, emailed Michael Bierne, another BP employee, on April

13, 2010, and explained the reasons why BP concluded that it had run out of

drilling margin at 18,360 feet. He said that the team decided to stop drilling

because it had become “a well integrity and safety issue.” 66 The email also states:

We had one major problem however: the sand that we took the initial

GeoTap pressure in was measured at 14.15 ppg. The absolute minimum

surface mud weight we could use to cover the pore

‐ pressure in this sand

was 14.0 ppg. This would give us approximately a 14.2 ppg ESD over the

aforementioned sand. If we were to drill ah ead with a 14.0 surface mud

weight/14.2 ESD, our equivalent circulating density (ECD) would be

approximately 14.4

‐ 14.5 ppg. We had already experienced static losses

with a 14.5 ppg ESD! It appeared as if we had minimal, if any, drilling

margin

. . . Drilling ahead any further would unnecessa rily jeopardize the

wellbore. Having a 14.15 ppg exposed sand, and taking losses in a 12.6

66 BP

‐ HZN

‐ MBI00126338. Date Depth MW Losses PP Remarks Hydrocarbon Zones

2-Ap r 17,007 - 17,321 14.3 17,168 FIT 16.22 PPG 17,684 - 17,693 M-57C 14.1 PPG

3-Ap r 17,321 - 17,835 14.5 233 bbls 17,723 - GeoTap 14.15 ppg (PP) 17,786 - 17,791 M-56A 13.1 PPG

3-Ap r 17,835 - 17,909 14.3

4-Ap r 17,909 - 18,195 14.3 12.58 @ 18,089 Schematic - 12.6 ppg at 18,066 18,061 - 18,223 M-56E 12.6 PPG

4-Ap r 18,215 - 18,250 14.4 639 bbls Lost full returns

5-Ap r 18,260 14.0 1263 - Total

6-Ap r 14.0 1586 - Total

7-Ap r 14.0

8-Ap r 14.0

9-Ap r 18,360 14.0 called TD Open Hole Interval below 9 7/8-in Liner @ 17,168 - FIT 15.98 PP 13.931 ppg reservoir in the same hole

‐ section had forced our hand. We had

simply run out of drilling margin.

C. Casing Program

Casing programs describe the number and sizes of the casing strings to be

set in the wellbore and are based upon pore pressure and fracture gradient plots.

Casing programs are designed based on a number of factors, including burst and

collapse pressure s, 67 tensile strength, 68 drill bit size, anticipated hydrocarbon

flow, and hydrocarbon type. BP originally designed the Macondo well to

include seven casing strings to reach the target well depth. However, based on

the actual conditions encountered during drilling, BP used nine casing strings to

reach total depth.

Conditions encountered during drilling can drive changes in casing

programs. For example, circulation loss events occurred in the ope n

‐ hole section

of the Macondo well. Lost circulation is the loss of drilling fluids (such as

drilling mud and spacer) into the formation. This loss of drilling fluid is

observed during the circulation of drilling fluids. When less fluid is returned up

the well annulus than was pumped into th e well through the drill string, this

means a loss of drilling fluid

– lost returns

– has occurred. These lost returns

were a factor in BP’s decision to limit the well total depth to 18,360 feet (short of

the 20,200 feet originally planned) and also le d BP to revise the well’s casing

design program to account for mud weight and fracture gradient drilling margin

issues. Specifically, BP modified its casing program several times because of: (1)

a well control event in March 2010 that resulted in the drill pipe becoming stuck;

(2) changes in pore pressure estimates; and (3) well bal looning. 69 After BP

revised its casing program, it submitted a revised Application for Permit to Drill

to MMS for approval. 70

67 Burst pressure is the theoretical internal pressure differential at which a joint of casing will fail.

Collapse pressure is the pressure at which a tube or vessel will catastrophically deform as a result

of differential pressure between the outside and the inside of the tube or vessel. Schlumberger

Oilfield Glossary.

68 Tensile strength is the force per unit cross

‐ sectional area required to pull a substance apart.

Schlumberger Oilfield Glossary.

69 Ballooning, in which the formation absorbs drilling mud while the rig’s pumps are activated

and then releases the mud back into the well when the pumps are not active, can be

misinterpreted as a kick.

70 MMS approved: BP’s Application for Permit to Bypass, which added an additional casing

string, on March 15, 2010; BP’s Revised Application for Permit to Bypass, which added a liner, on32 D. Mud Program and Type

Drilling mud provides hydrostatic pressure ‐ pressure exerted by a fluid

at equilibrium due to the force of gravity

‐ to prevent formation fluids from

entering the wellbore. Drilling mud also keeps the drill bit cool and clean during

drilling, carries drilled cuttings out of the well and suspends the drill cuttings

whenever drilling is paused.

Operators have multiple options for the typ e of mud to use during the

drilling of a well, including oil

‐ based mud, synthetic oil

‐ based mud and water

‐

based mud. Depending on reservoir conditions, operators assess which mud

type is most appropriate for the specific well being drilled.

For the Ma condo well, BP chose a synthetic oil

‐ based invert mud system,

a system in which synthetic oil in the mud remains in a continuous fluid phase in

the lower hole sections of the well. BP chose this system for several reasons: (1 )

to enhance the ability to maintain consistent fluid properties independent of the

temperature and pressure conditions of the well; (2) to improve hole cleaning

and minimize barite sag, control of pressure spikes, and gaining gel strengths; 71

and (3) to deal with other problems that result when balancing equivalent

circulating density (“ECD”). 72 In selecting the synthetic oil

‐ based mud, BP also

sought to reduce fluid loss in order to minimize formation damage while

maintaining a higher drilling efficiency.

Synthetic oil

‐ based mud, such as the type BP used in the Macondo well,

has many positive features as described above. However, this type of mud also

presents risks relating to its effect on the crew’s ability to accurately detect

natural gas influx (kicks) into the well. A recent study of drilling fluid mixtures

and well control found that drillers might have a harder time detecting kicks

March 26, 2010; and BP’s Revised Application for Permit to Bypass, which included a production

casing, on April 15, 2010.

71 Society of Professional Engineers, SPE

‐ 116013

‐ PA

‐ Study of the PVT Properties of Gas—Synthetic

‐ Drilling

‐ Fluid Mixtures Applied to Well Control (2009). “Barite sag” is the settling of barite particles

(or other weighting materials), which can result in fluctuations in drilling fluid density. When

this occurs in drilling mud, the mud lose s its integrity and can only be a temporary barrier in the

well. Gaining, or progressive, gel strengths typically require higher pump pressures to break

circulation.

72 ECD is the total effective pressure that a column of drilling mud exerts on a formation as the

mud is circulated through the drill string and back up the wellbore, accounting for frictional

forces throughout the circulatory system.33 when using synthetic oil

‐ based mud. The study stated that “an important aspect

that should be addressed when drilling with a synthetic fluid is the peculiarities

concerned with well control. Because of the solubility of formation gas in oil

‐

based fluids, it could be completely dissolved in the mud at bottom

‐ hole

temperature and pressure conditions, making kick detection very difficult.” 73

The Panel found no evidence that BP and MI

‐ SWACO discussed whether

the use of synthetic oil

‐ based mud would affect the rig crew’s ability to detect

kicks during drilling operations at Macondo. Even so, the Panel found no

evidence that the specific mud program used by BP and MI

‐ SWACO was a cau se

of the blowout.

E. Mud Losses

Throughout the drilling of the Macondo well, BP experienced multiple

incidents where mud was lost into the formation. While the loss of mud during

drilling operations is not uncommon, it is a key indicator to drilling engineers

that they must monitor the well closely to ensure that well and formation

integrity are being maintained pr operly. Abnormal pressure zones identified as

a result of mud loss events often lead drilling engineers to change the well design

and casing setting points.

BP drilled the Macondo well to a measured depth of 18,360 feet. The crew

set a 9

‐ 7/8 inch liner in place at 17,168 feet measured depth prior to drilling the

production section, which was the final section of the w ell. The last section was

difficult to drill due to a decrease in the fracture gradient at the bottom of the

wellbore. This condition required BP to carefully select the correct mud weight

necessary to maintain overbalance relative to the formation while avoiding fluid

losses to the well.

According to IADC daily reports, the well experienced mud losses of

approxima tely 3,000 bbls across the hydrocarbon zones of interest during the

drilling of th e production casing open

‐ hole section. The crew controlled these

losses with the addition of lost circulation material (“LCM”) pills and a relatively

small quantity (less than 200 bbls) of a special blend of drilling fluid, which help

retard the loss of mud into fractures and highly permeable formations. From the

time the Deepwater Hor izon moved onto location at Macondo, a total of

73 Id.34 approximately 15,500 bbls of drilling fluids were lost during drilling, running

casing and cementing operations. 74

F. Well Ballooning

Well ballooning is a common phenomenon in which the formation

absorbs drilling mud while the rig’s pumps are activated and then releases the

mud back into the well when the pumps are not active. Well ballooning is

significant because it can mimic a kick. Rig crews can therefore mis s critical kick

indicators if they mistakenly believe that ballooning is occurring in the well.

Mud logging data for the Macondo well demonstrated that the production

casing zone started ballooning between 17,530 feet and 17,761 feet. The daily

IADC reports also show that the well flowed back during flow checks following

mud loss at those depths.

G. Planned and Actual Total Depth

In designing a well, engineers calculate a planned tota l depth of the well.

BP’s February 2009 Exploration Plan estimated the well depth at approximately

20,200 feet true vertical depth. Due to a narrowed drilling margin, BP ultimately

decided to stop drilling the well at 18,360 fee t.

BP set a casing string at 17,168 feet measured depth (sometimes referred to

as “MD”) and then continued to drill the final production section of the well. In

the section below the last two casing strings, the well lost returns, indicating

possible fra cturing or formation pressure regression. In response, the crew

stopped drilling, pumped in lost circulation materials to seal the fracture, and

restored mud circulation. 75 In this open

‐ hole interval (where no casing string

had been set yet) the pore pressure decreased from 14.5 ppg to 12.6 ppg between

the sand interval at 17,233 feet measured depth and the M56 target formation at

18,083 feet through 18,206 feet. Because of the decreasing pore pressure at this

depth of the well, there was no drilling margin in the op en

‐ hole section of the

well, which meant that the mud weight necessary to prevent the formation from

flowing at the upper portion of the open hole could result in the formation

fracturing in the lower section. 76 BP explained to its partners, MOEX and

74 BP

‐ HZN

‐ MBI00304121.

75 BP

‐ HZN

‐ MBI00126338.

76 Id.35 Anadarko, that it chose to terminate the well at 18,360 feet MD, based on

concerns about well integrity and safety related to this loss of drilling margin. 77

By terminating the well where it did, BP set the total depth of the well in a

laminated sand

‐ shale interface. 78 BP internal guidelines for total well depth

specify that drilling should not be stopped in a hydrocarbon interval, unless

necessary due to operational, pressure and safety issues. 79 Typically, total depth

is not called in a sand section because placing the casing shoe

– the section of the

casing between the bottom of the wellbore and the float valve

– in a laminated

sand

‐ shale zone increases the likelihood of cement channeling or contamination

due to washout, and creates difficulties in lo gging well data. 80 Figure 3 depicts

the placement of the Macondo well shoe track.

77 Id. BP’s September 2009 Pre

‐ Drilling Data Package also indicated that, if after drilling the

primary M56 objective there was an onset of pressure requiring a new casing string, no further

drilling would be feasible. See BP

‐ HZN

‐ MBI00013494.

78 Sand is more permeable than shale. Therefore, when casing is set in sand, lost returns are

more likely.

79 BP

‐ HZN

‐ MBI00013494.

80 Cement channeling occurs when the cement slurry in the annulus does not rise uniformly,

leaving spaces and therefore preventing a strong bond.36 Figure 3

‐ Macondo Well Shoe Track and Hydrocarbon Intervals

H. Designing the Production Casing

– Long String versus Liner

BP drilled the Macondo well to a hydrocarbon

‐ bearing zone and planned

to return to this zone at a later date to complete the Macondo well for

production. Before moving th e Deepwater Horizon rig off of the Macondo well,

BP chose to set a production casing that would be used to extract hydrocarbons

at a later date. 7,567' MD - Bot of 5-1/2" 21.9 ppf S-135 (3450' of pipe)

8,367' MD (3-1/2" - 800' pipe)

XOVER 12,487.64'

9-7/8" Liner @ 17,168' MD / 17,157' TVD 28" @ 6217' MD/TVD (1150' bml)

TD @ 18,360' MD / 7" Shoe @ 18,303.92' MD ML @ 5067' MD/TVD

16" @ 11,585 MD / TVD (6518' bml)

13-5/8" @ 13,145' MD / 13,133' TVD

11-7/8" Liner @ 15,103' MD / 15,092' TVD 36" @ 5,321' MD/TVD (254' bml)

22" @ 7937' MD/TVD (2891' bml)

18" @ 8969' MD/TVD (3902' bml) 9 7/8” Liner 17,168’

14.1 pp g

M57C sand 17,684’-17,693’

( brine )

17,786’-17,791’

18,061’-18,073’

18,104’-18,175’

18,202’-18,223’ 12.6 pp g

M56E sand

13.1 ppg

M56A sand

7” shoe 18,304’

Float Collar

18,115’37 The production casing runs from the bottom of the well up to the

wellhead. There are two general design options for production casings

– a long

string design or a liner design. A long string casing design consists of a

production casing that extends from the bottom of the well to the top of the

wellbore. A liner casing design co nsists of a casing that is anchored or

suspended from inside the bottom of the previous casing string and does not

extend to the top of the wellbore. The liner design has the option of being tied

back to the top of the wellhead.

In general, both long st ring and liner production casings have two

annulus barriers: cement across the hydrocarbon zones and the mechanical seal

at the top of each string. The mechanical seal in a long string casing includes the

wellhead casing hanger seal assembly. A liner design uses a liner top packer

assembly. The liner ti e

‐ back provides two additional barriers: the liner tie

‐ back

cement and the tie

‐ back seal assembly. However, the use of a liner tie

‐ back

design also involves risks associated with the possibility of mechanical integrity

failure at the tie

‐ back junction, as well as the potential fo r increased annular

pressure build

‐ up, which could occur as a result of annular fluid expansion

caused by heat transfer during the well’s production phase. Annular pressure

build

‐ up increases the risk that the production casing or tie

‐ back string will

collapse if annulus fluids or pressure beco me trapped by the assembly with no

outlet for bleed

‐ off.

BP’s well engineering team prepared an undated “Forward Plan Review”

addressing production casing and temporary abandonment options for the

Macondo well and circulated it within BP in April 2010. The forward plan

recommended against using the long string design because of the risks described

above that are associated with tha t type of design. This document stated that,

while the long string of 9

‐ 7/8 x 7 inch casing “ was the primary option,” the use of

a 7 inch liner was “now the recommended option” for the following reasons:

cement simulations suggested tha t cementing the long string was unlikely to be

successful due to formation breakdown; using a long string would prevent BP

from meeting regulatory requirements of 500 feet of cement above the top

hydrocarbon zone; the long string would result in an open annulus to the

wellhead, with hydrocarbon zones(s) open to 9

‐ 7/8 inch seal assembly as the only

barrier; and the potential need to verify the cement job with a bond log and to

perform one or more re medial cement jobs prior to the temporary abandonment

of the well. 81

81 BP

‐ HZN

‐ MBI00020910.38 BP also identified advantages of using a liner design, including that the

liner hanger would act as second barrier for hydrocarbons in the annulus; the

primary cement job on the liner had a slightly better chance for successful cement

lift due to lower ECD; 82 and it would be easier to justify postponing any remedial

cement job until after the temporary abandonment procedure was completed. 83

BP employees evaluated these approaches to designing the production

casing. For example, on April 14, BP Drilling Engineer Brian Morel emailed a

colleague, Richard Miller, about the options. In his email, Morel referred to

Macondo as a “nightmare well which has everyone all over the place.” Miller

responded to Morel’s email, advising Morel that he ha d updated his calculations

and model, which indicated that both proposals for the production casing design

were “fine.” 84

When early cement modeling results suggested that the long string could

not be cemented reliably, BP’s design team switched to a liner design. However,

on April 13, Morel asked Eric Cunningham, an in

‐ house BP cementing expert, to

review Halliburton’s cementing recommendations and modeling. Cunningham

determined that certain cement modeling parameters used by Halliburton

should be corrected. The results of the revised modeling caused BP to switch

back to the use of a long string as the primary option for the produ ction casing.

Ultimately, BP chose to install a long string production casing in the

Macondo well instead of using a liner and tieback. A BP “Management of

Change” do cument stated that this decision was based on the following factors:

the long string provided the “best economic case and well integrity case for

future completions operations;” the recent cement modeling showed that the

long string could be cemented successfully and, while us e of a liner “is also an

acceptable option,” doing so would add $7

‐ 10 million to the cost of completing

the well. 85

The Panel found no evidence that the long string production casing design

was a cause of the blowout.

82 Cement lift is increased pump pressure that results when cement that is pumped down the well

begins to flow back upward against gravity.

83 BP

‐ HZN

‐ MBI00020910.

84 BP

‐ HZN

‐ CEC000021857.

85 BP

‐ HZN

‐ MBI00143292. “Management of Change” is BP’s formal process for evaluating and

approving operational decisions.39 BP had a third option (other than installing a long strong production

casing or a liner tie

‐ back)

– it could have temporarily abandoned the Macondo

well without setting any production casing, which is an option for wells with

zero drilling margin. For example, in January 2009, on a well BP drilled prior to

Macondo, th e Kodiak well at MC 727 Number 2, the Deepwater Horizon crew

temporarily abandoned the well without running production casing. In August

2009, BP and the Deepwater Horizon crew also temporarily abandoned the Tiber

well, KC 102 Number 1, which had similar drilling margin hazards to the

Macondo well, without setting a productio n casing

. BP acknowledged this third

option in a later iteration of the temporary abandonment and production casing

“Forward Plan” discussed above, which stated that the company could plug the

open hole and temporarily abandon the well. BP noted that this was an option if

“hole cond itions go south.” 86 While all of the “primary well objectives” had been

achieved, and although BP could have minimized any additional immediate

spending on the well, the third option would have increased completion costs by

$10 to $15 million because BP would at a future time have had to drill out the

cement plugs, re

‐ drill the production hole, an d re

‐ log the well data. 87 For these

reasons, this was BP’s least preferred option.

If BP had temporarily abandoned the Macondo well without running the

production casing, as it had done with prior wells with narrow drilling margins,

BP would likely have had an opportunity to consider other options for setting

the casing, such as sid etracking the well and setting the casing in a location with

a lower potential for lost returns. In addition, as discussed below, if BP had

temporarily abandoned the Macondo well without setting a production casing, it

would not have taken steps to set a lock down sleeve and could have set the

surface plug higher in the well.

86 BP

‐ HZN

‐ MBI00143295.

87 Id.40 

### III. Cementing

The main purpose of cement within a well is to achieve zonal isolation.

Cement reinforces the casing and prevents the flow of hydrocarbons through the

annular space. This section discusses the cementing of the final production

casing in the Macondo well.

A. Cementing Process

Prior to cementing a well, the rig crew conditions th e wellbore by

circulating mud through it. This conditioning cleans out any cuttings or other

debris in the casing, drill pipe and wellbore that could interfere with cement

placement. When mud is circulated completely through the casing (so that the

mud on the bottom of the well returns to the surface), o perators have achieved a

“complete bottoms

‐ up.” By performing a complete bottoms

‐ up, the crew not

only cleans out the wellbore, but can also analyze the mud that had been on the

bottom of the well to determine whether hydrocarbons are present before

cementing.

After circulating mud, the crew pumps the volume of ce ment modeled for

the job down the well, followed by the drilling mud that is pumped behind the

cement to push the cement to its planned location. Darts and wiper plugs

separate the cement from the mud to prevent the oil

‐ based mud from mixing

with, and possibly contaminating, the cement. 88 At Macondo, the crew first

pumped base oil (synthetic oil with no additives) ahead of a water

‐ based spacer

(a spacer is a fluid mixture that keeps the mud and cement separated). The

spacer was followed by a bottom dart, the cement, the top dart and more spacer.

After the second spacer, the crew pumped drilling mud to push the materials in

front of it do wn the drill pipe.

When the darts reach the end of the drill pipe, the darts launch bottom

and top wiper plugs that separate the cement from the other materials traveling

down the well. When the botto m plug reaches the top of the float collar,

pressure causes the plug to rupture, and cement passes through the plug into the

shoe track. After all of the cement has moved through the bottom plug and into

the track, the top wiper plug lands on the float valves. The top pl ug is not

88 A “dart” is a device pumped through a tubing string to activate downhole equipment and

tools. A “wiper plug” is a plastic component that travels down the well to separate the spacer

and the cement.41 designed to rupture but instead remains intact to prevent mud or spacer from

flowing down the well. If the cement job has gone as planned, the cement should

be in the correct place in the annulus and should fill the shoe track when the top

plug lands.

B. Cement De sign and Modeling

BP worked with Halliburton to design the parameters of the Macondo

cement job. Because of the lost returns BP had encountered throughout the

drilling of the Macondo well, BP focused on reducing the chance of additional

losses during the final cement job. BP sought to minimize these losses by

reducing the volume of cement it pumped into the well, lowering the rate at

which cement was pumped into the well and using a nitrified cement slurry for

part of the cement job. As discussed further below, use of lower density nitr ified

foam cement offered advantages in terms of reducing the risk of formation

breakdown, but also presented technical cha llenges in ensuring that the cement

mixture is stable. 89

1. Cement Volume

BP chose to limit the height of the cement in the annulus because the

higher the annular cement column, the more pressure the cement would exert on

the formation below, increasing the likelihood of additional lost returns and

potential for fracturing. BP engineers proposed to set the top of the cement in

the annulu s at about 17,300 feet total depth, which was approximately 500 feet

above the uppermost hydrocarbon zone. 90 MMS regulations required the

cemented annular space in a production casing job to be 500 feet above the

uppermost hydrocarbon zone. 91

89 On August 1, 2011, Oilfield Testing and Consulting (“OTC”) completed a forensic analysis of

the cement samples mixed to replicate the cement slurries that were pumped into the Macondo

well. OTC’s analysis revealed a range of potential cement setting times for the foamed and

unfoamed cement. Several of the samples tested reve aled setting times greater than 18 hours (the

time period between the completion of the cement job and the start of the negative tests). See

OTC Report at page 30. The Panel, however, found that there was strong evidence that the

cement had set prior to the time the rig cr ew performed the negative test. See

http://www.oilspillcommission.gov/sites/defaul t/files/documents/Chevron%20letter%2010%2026

%2010.pdf.

90 BP

‐ HZN

‐ MBI0023746. “Top of cement” is the depth in the well where the cement that has

already been set in the well ends.

91 30 CFR § 250.421.42 Halliburton pumped a total of 51 bbls of cement for the production casing

cement job, consisting of 5.26 bbls of lead cement, 38.9 bbls (47.74 bbls when

foamed) of foamed cement, and 6.93 bbls of tail cement. 92 BP did not plan to

pump cement above the top wiper plug in order to preserve the ability to run a

cement evaluation log (discussed below), if necessary. Cement above the wiper

plug would have provided an additional barrier to hydrocarbon flow.

2. Pump Time and Rate

BP planned to pump the cement into the well at a relatively low rate of

four barrel s a minute in order to reduce pressure on the formation that could

result in lost returns. This strategy carried risks since a higher pumping rate

generally would have increased the likelihood that cement would displace mud

from the annulus and thereby would have increased the likelihoo d of a

successful cement job.

BP was aware that it was using a low pump rate, so it wanted to be able to

maximize the amount of time it could run the pump without the cement setting

up or fracturing the formation. Brian More l, BP Drilling Engineer, expressed this

in an email to John Guide, BP wells team leader, on April 17, which stated: “I

would prefer the extra pump time with the added risk of having issues with the

nitrogen. What are your thoughts? There isn‘t a compressive strength

development yet, so it’s hard to ensure we will get what we need until its [sic]

done.” 93

3. Nitrified Cement

Another way in which BP sought to reduce additional lost returns during

the cement job was by using a nitrified or “foamed” cement slurry in the annular

space (the “tail cement” for the shoe track was unfoamed cement). Cement

specialists make nitrified or foamed cement by injecting cement with ni trogen

bubbles while the cement is being prepared on the rig. Nitrified cement is less

dense than unfoamed cement and therefore exerts less pressure on the formation.

However, the use of foamed cement creates the risk of nitrogen breakout

– if the

nitrogen bubbles in the cement “break out” of suspen sion

– which can result in

inconsistent cement placement and densities. The use of nitrified cement in

92 BP

‐ HZN

‐ CEC011406.

93 BP

‐ HZN

‐ MBI00255923.43 deepwater wells is typically a viable option; however, care should be taken when

designing and executing the job to prevent nitrogen breakout.

Testing the stability of foam cement before it is used in an offshore cement

job is common practice in the industry. Consistent with this practice, Halliburton

shipped samples of the Macondo cement to its laboratory in advance of the date

on which th e cement components were to be used on the Macondo well and

retained surplus samples from the testing program. Halliburton conducted pre

‐ job testing of the mixture of ingredients to be used in the Macondo cement slurry

to assess whether the cement could be pumped and wo uld set up properly under

conditions simulated to match those down the wellbore.

While Halliburton conducted several pre

‐job cement tests, it did not finish

its final compressive strength analysis for the cement used on the production

casing string. Compressive strength analyses determine the length of time for

the cement slurry to develop sufficient strength to achieve zonal isolation and

provide sufficient support to th e casing. On April 19, Jesse Gagliano, the

Halliburton in

‐ house cementing engineer, told the BP well site leaders and Brian

Morel that the compressive strength analysis for the cement job had not been

completed. 94 Nevertheless, BP continued the cement job without this

information. The Panel found no evidence that BP or Halliburton ever shared

the cement stability results or the OptiCem reports (showing gas flow potential)

with Transocean personnel on the Deepwater Horizon or in the Houston office.

Halliburton’s post

‐ blowout laboratory worksheets dated May 26, 2010,

show that th e foam

‐ slurry cement did not meet American Petroleum Institute

Recommended Practice (“API RP”) 65. 95 Additionally, laboratory tests

conducted by Chevron on behalf of the National Commission on the BP

Deepwater Horizon Oil Spill and Deepwater Drilling (“Presidential

Commission”) showed that the foamed cement slurry used on the Macondo well

was not stable.

4. Cementing a Long String

As discussed above, BP debated internally whether to us e a long string or

liner with tieback as the final production casing. BP had difficulties with the

cement in one of the two long strings it ran in the Macondo well prior to the

94 BP

‐ HZN

‐ MBI00192892.

95 HAL0050590.44 production casing. When BP drilled out the cement job on the 16

‐ inch

intermediate long string, it discovered that the condition of the shoe track

suggested that the cement had not set up properly, leading the cement to channel

and result in lost returns. 96

5. Cement Modeling

Offshore operators use cement models to calculate real

‐ time equivalent

circulating densities based on actual cement volumes, rates and fluid densities.

By modeling various inputs, operators can assess, among other things, the

likelihood that channeling in the cement will occur as it sets up. Channeling in

cement is a problem becau se it can provide an opportunity for gas to flow

through the cement, which is quantified as gas flow potential.

For the Macondo well, BP used Halliburton’s OptiCem program to model

pumping sequences of various fluid densities and volumes to determine whether

the minimum formation fracture pressure wou ld be exceeded. In all, Halliburton

developed at least 30 to 40 models for the cement to be used with the Macondo

production casing. 97 In developing these models, BP and Halliburton frequently

changed assumptions about the casing string and number of centralizers to be

used. For example, Halliburton generated an OptiCem model on April 15 at 3:30

p.m., which showed that channeling could result if only ten centralizers were

installed in the well. The model called for ten centralizers to be installed between

18,300 feet and 17,811 feet meas ured depth, using approximately 45

‐ foot spacing

and an approximate 80% standoff. 98 The resulting gas flow potential (“GFP”)

was moderate at a reservoir zone of 18,200 feet measured depth.

Later on April 15, Halliburton ran a second model using 21 centralizers

installed between 18,300 feet and 17,400 feet measured depth, using 45

‐ foot

spacing with a 70% top of centralized interval standoff. This model predicted

that channeling would not occur; the resulting gas flow potential was minor.

Based on th is report, BP ordered 15 additional centralizers to supplement the six

centralizers already on the Deepwater Horizon

. BP’s decision

‐ making with respect

96 BP

‐ HZN

‐ MB100036098. Cement channeling is a failure during the cementing of the casing to

the formation in which the cement slurry leaves open spaces where hydrocarbons can potentially

flow. The shoe track is the space between the float collar and a piece of equipment called a

reamer shoe (located at the bottom of the casing).

97 Testimony of Jesse Gagliano, Joint Investigation Hearing, August 24, 2010, at 245.

98 Standoff is the smallest distance between the casing and the wellbore wall. The standoff ratio is

the ratio of the standoff to the annular clearance for a perfectly centered casing.45 to the installation of centralizers during the temporary abandonment procedure

is discussed in more detail below.

On April 18, 2010, Halliburton modeled the well with seven centralizers

installed between 18,305 feet and 18,035 feet measured depth, with 45

‐ foot

spacing. The resulting gas flow potential was severe at a reservoir zone of 18,200

feet meas ured depth.

At approximately 8:58 p.m. on April 18, Jesse Gagliano, a Halliburton

cementing engineer, sent an email to several BP and Halliburton personnel

attaching this version of the OptiCem model, along with partial lab results on

compressive strength and Halliburton’s recommended cementing procedure for

the Macondo well cement job. 99

BP used the April 18 OptiCem report as the basis for the actual cement job

it performed on April 19.

6. Weaknesses in the Cement Modeling

The Panel identified the following incorrect assumptions in the April 18

OptiCem model:

 The model assumed a pore pressure of 13.97 ppg for the hydrocarbon

zone at 18,200 feet bas ed on a linear profile between 17,700 feet and 18,305

feet. This was inconsistent with the measured pore pressure value of this

zone, which was 12.5 to 12.6 ppg.

 Halliburton’s report used incorrect centralizer data. The model used a

nominal diameter of 8.622 inches, but the installed centr alizers had an

actual diameter of 10.5 inches. The model also spaced the centralizers 45

feet apart instead of using the actual, variable centralizer spacing BP

specified to Halliburton. 100 The model also assumed seven centralizers

rather than the six that actually were used in the Macondo production

casing cement job.

99 BP

‐ HZN

‐ MBI00128708.

100 BP specified that centralizers would be spaced at varying intervals. See BP

‐ HZN

‐ MBI00127389.46  While Halliburton modeled the mud as an oil

‐ based mud with a constant

density of 14.17 ppg, the synthetic oil

‐ based mud actually used in the well

was compressible and had a variable density.

 Halliburton’s cement job design included using base oil with a density of

6.7 ppg. BP actually used the 6.7 ppg dens ity base oil in the final cement

job, but Halliburton’s April 18 model assumed that the base oil would

have a 6.5 ppg density.

 In the April 18 model, Halliburton assumed 135° F as the bottom hole

circulating temperature, but BP modeling showed that circulating

temperature during cementing wo uld be 140° F.

The Panel found no evidence that, despite the inconsistencies described

above, BP questioned the data in the April 18 model before the blowout. Nor did

the Panel find any evidence that BP shared the OptiCem model information with

the Transocean crew or personnel onshore. Given the importance of the

production casing cement job to th e integrity of the well, access to OptiCem data

was critical to allowing the rig crew to fully understand the risks.

C. Gas Flow Potential

BP witnesses testified that they were not aware of, nor did they review,

the gas flow potential calculations included in the OptiCem mode l report. Brett

Cocales, a BP operations engineer, testified that he was “not familiar with gas

flow as it relates to cementing.” 101 Testimony from BP personnel demonstrated

that they did not fully understand the gas flow potential outputs reflected in the

OptiCem models and instead only considered the ECD charts in evaluating the

cement model results. 102

In the OptiCem models, gas flow potential higher than seven is typically

considered severe. Despite the severe gas flow potential indicated by its April 18

OptiCem model, Halliburton employees provided the following testimony

demonstrating that they believed the OptiCem models did not raise immediate

safety concerns:

101 Testimony of Brett Cocales, Joint Investigation Hearing, August 27, 2010 at 155.

102 Cocales Testimony at 22; Testimony of David Sims, Joint Investigation Hearing, August 26,

2010 at 223.47  Nathaniel Chaisson, a cementing engineer, stated that “poor centralization

does not equate to complete blowout;” 103

 Jesse Gagliano, a cementing engineer, stated that “channeling does not

equal a blowout;” 104 and

 Vincent Tabler, a cementer, stated that, in a meeting on April 19, no one

raised concerns about the risk associated with the production casing

cement job. 105

It is not common for operators in the Gulf of Mexico to complete cement

jobs that present a severe gas flow potential, although cement jobs with these

conditions have been completed successfully in the past. Halliburton provided

the Panel with information about the number of cement jobs it conducted

between January 1, 2005 and April 20, 2010 where the gas flow potential was

calculated to be severe. The Panel reviewed records for jobs performed in the

Gulf of Mexico, and offshore in Brazil, Norw ay and the United Kingdom, which

showed that 53 of these jobs had severe gas flow potential. Eleven of these 53

cement jobs were performed in th e deepwater of the Gulf of Mexico. BP was the

operator on two of Halliburton’s severe gas flow potential cement jobs

conducted in the deepwater Gulf of Mexico.

D. Centralizers

A centralizer is a device that fits around a casing string or liner to ensure

centering of the casing in an ope n hole. Centralization of casing strings and

liners facilitates the efficient placement of cement around the casing string. Even

though the Macondo well was a straight hole, BP used centralizers because the

diameter of the production casing does not always align exactly with the center

of the wellbore and, therefore, withou t centralizers the production casing could

rest along the sides of the wellbore. Casing string contact with the side of the

wellbore can lead to void spaces in the cement job (referred to as “channeling”).

On April 14, four days before the productio n casing was scheduled to be

run, BP had only six centralizers available on the Deepwater Horizon for the

production casing cement job. The six centralizers already on the rig had built

‐ in

stop collars. Stop collars prevent a centralizer from moving up and down the

casing and built

‐ in stop collars are integrate d into the centralizer. Other

103 Testimony of Nathaniel Chaisson, Joint Investigation Hearing, August 24, 2010, at 419.

104 Gagliano, testimony at 264.

105 Testimony of Vincent Tabler, Joint Investigation Hearing, August 25, 2010, at 12

‐ 13.48 centralizers use stop collars that are separate components and slip onto the

centralizers. Because the April 15 OptiCem report predicted less channeling with

a total of 21 centralizers, the BP Macondo well team located 15 additional

centralizers from Weatherford, an oil

‐ field service company, and arranged for

them to be sent to the BP shore base in Houma, Louisiana, from which the

centralizers would be flown to th e rig. 106

A Weatherford representative, Daniel Oldfather, however, testified he

could not locate all the centralizer materials at the BP shore base. 107 While the 15

centralizers were at Houma, additional centralizer components, including stop

‐

collars and epoxy were not available. 108 Oldfather further testified that a BP

representative told him that the additional components would be shipped to the

rig by boat. 109 On April 16, Oldfather flew to the Deepwater Horizon with the 15

centralizers and waited for the other centralizer components to arrive. 110 When

the 15 centralizers arrived on the rig, Brian Morel examined them and told John

Guide, the BP wells team leader, that the 15 centralizers did not have stop collars

on them but that they would have “plenty of time” for the stop collars to be

delivered to the rig. 111 BP had planned to send the additional centralizer

components by boat, which was to arrive the afternoon of April 16. By 10:00 p.m.

on that date, the boat had not arrived. 112 On the morning of April 17, Morel told

Oldfather that BP would run only the six centralizers with built

‐ in stop collars

that BP already had available on the rig. Oldfather testified that he never

determined whether the shipment with the additional centralizer components

arrived on the Deepwater Horizon

. 113

Guide explained in an email and in his testimony before the JIT the

rationale for BP‘s decision to use only 6 centralizers rather than the 21

centralizers that been planned. According to Guide, BP believed based on its

previous experience that the 15 centralizers delivered to the rig, which had

separate stop collars th at needed to be slipped onto the centralizers, might come

apart and clog the wellbore. 114 Finally, Guide noted that it would have taken an

106 Testimony of Daniel Oldfather, Joint Investigation Hearing, October 7, 2010, at 7.

107 Id

.

108 Id

. at 8

‐ 9.

109 Id

.

110 Id

. at 9

‐ 12.

111 BP

‐ HZN

‐ MBI000255668.

112 Oldfather testimony at 11

‐ 12.

113 Id. at 12

‐ 13.

114 Guide testimony, July 22, 2010 at 67

‐ 68.49 additional 10 hours to install 21 rather than 6 centralizers, and he stated that the

earlier decision to use 21 centralizers was made by Gregg Walz, BP drilling

engineer team leader, and others in his absence. 115

The Panel found no evidence that BP’s decision to use 6 centralizers rather

than the 21 recommended by Halliburton was a cause of the blowout.

E. Float Collar

1. Float Collar Function

Float collars are one

‐ way valves installed at or near the bottom of the

casing string. When a float collar has been successfully “converted” it will allow

fluids to flow in only on e direction. A converted float collar allows cement and

other fluids to be pumped down the well without reversing direction and

coming back up the casing. BP used a Weatherford Model M45AP mid

‐ bore

auto

‐ fill float collar in the Macondo well, which is depicted in Figure 4 belo w.

The float collar uses a double

‐ check valve

– a mechanical valve that

permits fluid to flow in one direction

– that is held open by an auto

‐ fill tube.

When running the casing into the well, the auto

‐ fill tube allows mud to flow into

the casing, thereby reducing the force exerted by the mud on the formation an d

helping to prevent loss of fluids into the formation. To convert the float collar, a

ball (in this case an “Allamon ball” because the float collar was ma nufactured by

Allamon) rests in the auto

‐ fill tube when running the casing into the well and

when mud pumping starts it restricts the flow of mud by diverting the mud

through two small ports in the auto

‐ fill tube. Circulation through these ports

creates a differential pressure in the float collar, forcing the auto

‐ fill tube out of

the float co llar and allowing the check valves to close. In doing so, a float collar,

which is set near the bottom of the casing string, acts as a check valve and

prevents cement that is pumped down through the casing from flowing back

into th e shoe track (which is the distance between the float collar and end of the

casing) once the cement is in place. If the float collar fails to convert, it is possible

for “reverse flow” or “u

‐ tubing” flow to occur from the bottom of the casing up

the wellbore toward the rig.

115 BP

‐ HZN

‐ CEC022433.50 Figure 4

– Float Collar Utilized in the Macondo Well

As discussed above, the float collar was set at 18,115 feet measured depth,

within the primary hydrocarbon reservoir sands (see Figure 2, above). Typically,

an operator sets the float collar below the primary hydrocarbon sands to allow

for perforation of the pay zone without the ne ed to drill out the float equipment

to get below the pay zone during the completion of the well. In addition, the

lower primary sand was less than 100 feet from the bottom of the production

casing shoe. 116 Normally, an operator would set the production casing shoe 200

to 300 feet below the primary sand to improve the chances of proper isolation of

the pay sand.

116 BP

‐ HZN

‐ MBI00018459. 

### Auto-Fill Tube Auto-Fill Ball

Float Check Valve

Circulation Port51 2. Float Collar Conversion Attempts

On April 18, at approximately 3:30 a.m., the Deepwater Horizon crew

started running the 9

‐ 7/8 x 7 inch long string production casing and finished the

procedure at 1:30 p.m. on April 19. 117 After the casing string landed, the crew

attempted to convert the float collars in preparation for pumping production

casing cement into the well. Based on information that Weatherford supplied,

the float collar conversion should have occurred with a differential pressure of

between 400 and 700 pounds per square inch (psi), which required a calculated

pump rate of five to se ven barrels per minute (bpm). A successful conversion of

the float collar would result in the float collar’s two check valves moving into a

closed position, which should prevent flow of cement (or other fluids) up the

casing.

The crew made nine attempts to establish circulation through the float

collar in an effort to convert the float collar, increasing pressure on each attempt.

The crew finally established circulation on the ninth try, at pressur e of 3,142 psi.

After circulation was established, the circulation pressure was only 340 psi,

which was lower than the pressure of 570 psi predicted by Halliburton’s

computer model. The pump rate required to move mud into the well and

through the shoe track (circulating pressure) never ex ceeded approximately 4

bpm, which was less than the five to seven bpm that Weatherford determined

was necessary for float collar conversion.

Because Bo b Kaluza, the BP well site leader, was concerned about the low

circulating pressure, he directed the rig crew to switch circulating pumps to

determine whether doing so would improve circulating pressure. They

eventually concluded that the pressure gauge they had been relying on was

inaccurate. 118

Nathaniel Chaisson, an onsite Halliburton engineer, testified that, after

circulation was established, Kaluza said “I’m afraid that we’ve blown something

higher up in the casing joint.” Chaisson understood Kaluza to mean that he

believed they had not been circulating mud from the bottom of the well up, but

117 BP Daily Drilling reports 4/19, 4/10 (BP

‐ HZN

‐ MBI

‐ 000136936; BP

‐ HZN

‐ MBI

‐ 000136946).

118 Cocales testimony at 71

‐ 75.52 rather were circulating it from some point higher in the well casing. 119 According

to notes of Kaluza’s interview with BP internal investigators, Kaluza discussed

with Guide and Keith Daigle, a BP well operations advisor, what Kaluza

considered to be the anomaly of the low circulation pressure after circulation was

established. In that conversation, Guide directed Kaluza to pump cement and

did not instruct him to redo tests or to take an y other precautions (for example,

setting another cement barrier on top of the wiper plug or more closely

monitoring well flows and pressures after completion of the cement job). 120

Despite Kaluza’s misgivings about low circulating pressure, the BP team

on the Deepwater Horizon concluded that the float valves had in fact converted

and therefore continued to the cement pumping phase of the temporary

abandonment operation.

3. Problems with Float Collar Conversion

The cementing crew believed that the float valves converted and,

therefore, proceeded to pump ce ment into the well, even though there was

evidence that the conversion never occurred. Without proper conversion of the

float collar, cement and other fluids would have a path to flow back up the

casing to the rig floor. Following the blowout, BP contracted Stress Engineering

to conduct a post

‐ incident analys is on float collars similar to that used on the

Macondo well. 121 Stress Engineering’s report concluded that the well

“experienced a blockage that prevented the float collar from converting during

steady state flow.” 122 Data analyzed by Stress Engineering supported the

likelihood that a blockage was present from as early as when the diverter was

closed using the Allamon ball, up through BP’s final attempt to convert the float

collar. 123 Stress Engineering could not determine whether the blockage occurred

at the float collar or at the reamer shoe. 124

119 Nathaniel Chaisson testimony at 432

‐ 433.

120 BP

‐ HZN

‐ MBI00021271.

121 Horizon Incident Float Collar Study

‐ Analysi s, Stress Engineering Services, November 22, 2010

(BP

‐ HZN

‐ MBI00262898).

122 Id.

123 Id.

124 The float collar and the reamer shoe were the two likely locations for blockage because they

each have flow

‐ directed ports that can become blocked with lost circulation material or other

debris. The reamer shoe ports can also become plugged as they are lowered into the hole. When

lowered, the shoe ports can scr ape against the open hole section, which can force debris into the

shoe ports and clog them. BP’s Brian Morel told BP investigators that he believed at the time of

the attempted float collar conversion that the reamer shoe was plugged. BP

‐ HZN

‐ MBI00021304.53 The Panel found additional evidence that a blockage may have been

present at the beginning of the production casing cement job. 125 Earlier in the

procedure, the crew landed a bottom wiper plug on the float collar in order to

establish a separation between fluids (spacer and mud) already present in the

well and in order to prevent contamination of the cement. After the wiper plug

landed on the float collar, pressure was applied to rupture a burst dis k in the

wiper plug, which would allow circulation of the cement job to continue. The

burst disk was designed to rupture at between 900 psi and 1,100 psi, but the disk

did not actually rupture until the pressure reached 2,900 psi.

BP might have been ab le to reduce the likelihood of float collar blockage

by installing a float collar that was more debris

‐ tolerant than the float collar used

on the Macondo well. Because of the numerous lost circulation events in the

well, BP had to use lost circulation material several times. When there is such

material in the well, dr illers sometimes use debris

‐ tolerant float collars to reduce

the chances that the material might lead to a blockage. Indeed, during the

attempted float collar conversion, one of BP’s contractors suggested to Mark

Hafle, a BP drilling engineer, that BP use a more debris

‐ tolerant float collar in th e

future. 126 Hafle’s response was that the float collar “shifted at 3140 psi. Or we

hope so.” 127 This response suggests that Hafle could not verify that the float

collar had converted, nor could he explain why it took so many tries to convert

the float collar.

The Panel did not find sufficient evidence to determine what caused the

blockage that affected the float collar.

F. Cementing the Macondo Product ion Casing

The April 19 cement job was performed according to the procedures

detailed in the April 18 OptiCem report. 128 However, BP used only six

centralizers in the well, rather than the seven centralizers recommended and

assumed in the April 18 model. Prior to cementing, BP did only a partial

A reamer shoe is a piece of equipment that guides casing towards the center of the hole as it is

lowered down the wellbore.

125 IADC report 4/19/10; Sperry Sun rig data.

126 BP

‐ HZN

‐ MBI00257031.

127 Id.

128 BP

‐ HZN

‐ CEC000011406.54 wellbore circulation because it was concerned about additional lost returns that

could result from a complete bottoms

‐ up circulation. 129

On April 19, Halliburton pumped the following fluids down the wellbore:

base oil, spacer fluid, unfoamed lead cement, foamed (or nitrified) cement that

would go in the annulus, tail cement and additional spacer. 130 After pumping

these fluids, Halliburton pumped mud down the well to move the cement into

place. 131 After about three and a half hours, the cement crew completed

displacement, and both plugs landed, or were “bumped,” with an estimated 100

psi of lift pressure (350 psi circulating to 450 psi) before bumping the top cement

plug. 132 The crew conducting the cement job believed they had received full

returns throughout the job, meaning that the crew believed that little or no mud

had been lost into the formation during the cement job. 133 Brian Morel, who was

usually based in Houston, had been on the rig during the cement job and sent an

email before he left the rig, saying that “... the cement job went well. Pressures

stayed low, but we had full returns the entire job, saw 80 psi lift pressure and

landed out right on the calculate d volume.” 134

1. Float Check

After finishing the cement job, the cementing crew conducted a float check

intended to confirm that the float valves had properly closed and, therefore,

would prevent any flow back up the well. Vincent Tabler, the Halliburton crew

cementer and Lee Lambert, a BP well site leader trainee, stood at th e cement unit

(a vessel on the rig that injects cement into the well) to verify that the checks

were holding. They allowed mud to “flow back until it was probably what we

call a pencil stream, and then it quit for a little while, and then when the rig

would heave, it would give another little pe ncil stream,” Tabler said, “I know it

was a good 15, 20 minutes that we watched it.” 135 At the conclusion of the float

check, the crew concluded that the float valves were holding. The cementing

crew completed this job approximately two hours after the cement placement.

129 Guide testimony, July 22, 2010, at 150

‐ 151.

130 See Halliburton post

‐ job nitrified cementing report and job log (Appendix F).

131 BP

‐ HZN

‐ MBI

‐ 00137365.

132 “Bumping the cement plugs,” refers to the process by which the rig crew tests whether the

cement plugs are in the proper place. The crew pumps fluid and looks for a pressure spike that

indicates that the cement plug has “landed” in place.

133 Nathaniel Chaisson email to Jesse Gagliano, April 20, 2010.

134 BP

‐ HZN

‐ MBI00129052.

135 Tabler testimony at 22.55 2. Cement Job Returns

During the cementing operation for the production casing, rig personnel

continuously monitored fluids being pumped into and flowing out of the well.

The rig crew calculated the quantity of fluids pumped into the well using the

pump’s piston volume output and efficiency. Piston volume is cal culated using

the pump’s liner inside diameter and stroke length efficiency. Sensors on the

pump measure how fast the pump is moving instead of directly measuring the

volume of fluid being pumped. Flow out of the Macondo well could be

measured several ways, including by monitoring pit volumes, 136 monitoring

Transocean’s flow paddles, 137 or monitoring the sonic and radar sensors (flow

‐

out meters) located in the return flow line. 138 Monitoring the return flow line

would provide the most accurate measure of fluid volumes out of the well. The

flow

‐ out meter has a 10 percent margin of error and must be based on properly

calibrated devices. Recalibration of the flow

‐ out meter is frequently necessary

due to rig movement, ballasting, crane operations, sea movement, and other

factors.

The rig crew observed that cement displac ement occurred at a rate of

approximately 4 bpm, and they believed that full returns were achieved while

circulating. 139 Dr. John Smith, an expert retained by the Panel, calculated that

both the main pit volume record and the calculated cumulative flow

‐ out versus

flow

‐ in indicated that about 2.3 bbls of mud was lost during the cement job. John

Gisclair of Sperry

‐ Sun performed a post

‐ job review of the flow

‐ in and flow

‐ out

data and agreed with Dr. Smith’s report that if the sensors and pa ddles had been

properly calibrated, the accuracy of the flow

‐ out volumes should have been

within 5 to 10 percent of the recorded data. 140 In testimony, however, Gisclair

cautioned that “flow

‐ out is never intended to be an actual measurement of

volume. If you want to see the volume, the actual amounts of a gain or a loss,

136 Pit volume refers to the amount of mud in any of the rig’s mud pits at a given time.

137 Transocean’s “Hitec” monitoring system on the rig had paddle

‐ type sensors. As fluid rushed

past, the fluid pushed and lifted the paddle. The system calculated flow rate based on how much

the paddle moved.

138 The return flow line was the conduit within the pit system.

139 BP

‐ HZN

‐ MBI137370.

140 Testimony of John Gisclair, Joint Investigation Hearing, October 8, 2010, at 100.56 you would always use the pit volumes, you would never use the flow

‐ out over a

given time.” 141

The Panel independently assessed the difference between the flow

‐ in and

flow

‐ out data and calculated that a maximum of approximately 80 bbls of fluids

(+/

‐ 10 percent based on the flow

‐ in and flow

‐ out data) could have been lost

during the cementing job. Using Sperry

‐ Sun data of flow

‐ in and flow

‐ out,

measured in gallo ns per minute and recorded every five seconds, the Panel

generated a flow

‐ out vs. flow

‐ in chart (Figure 5). The Panel converted the

Sperry

‐ Sun data from gallons per minute to barrels per minute. The chart ʹ s x

‐

axis shows the time (hours/minutes/seconds) during which the cement job

occurred at the Macondo well. On the y

‐ axis

, the flow

‐ in value was plotted

against the flow

‐ out value in barrels per minute. The difference between the

flow

‐ in and flow

‐ out values throughout the duration of the cement job was

approximately 80 barrels. Ass uming a 10% margin of error in the flow

‐ out

meter, the Panel calculated that an estimated 72 to 88 bbls of fluids could have

been lost during the production casing cement job.

This possible range of loss exceeded the entire volume of cement pumped

during the production casing cement job. This could indicate that over

‐ displaceme nt of cement occurred in the shoe track. In other words, the cement

could have been pumped into the well, past the shoe track, which would have

left spacer and no cement in the shoe track to isolate the center of the production

casing. If over

‐ displacement occurred, it would have resulted in insufficient

cement coverage in the shoe track.

141 Id. at 100

‐ 101.57 Figure 5

‐ Flow

‐ out vs. Flow

‐ in on the Production Casing

Cement Job (Calculated by Panel)

G. Industry Standards for Cementing

API RP 65 contains recommended practices focused on the drilling and

cementing of casings in the shallow sediments of deepwater wells in which

highly permeable and over

‐ pressured sands are found

. 142 In connection with the

production casing cement job on the Macondo well, BP diverged from a number

of API RP 65 recommended practices.

API RP 65 Section 7.5 provides the following guidance on preventing

cement from being displaced by drilling mud:

If casing is not to be run to bottom, the “rat hole” should be filled with a

higher weight mud to prevent cement from falling into the rat hole and

displacing rat hole fluid into the cement column, thus compromis ing the

cement’s properties. The fluid should be of adequate density and

properties that there will not be a tendency for the fluid to swap with the

cement as it is being placed.

142 API RP 65 (2002).58 Notwithstanding the specific guidance provided by API RP 65, the rig crew filled

the rat hole in the Macondo well with 14.0 ppg synthetic oil based mud (SOBM)

that was lighter than the cement slurry design. 143 The tail cement was 16.74

ppg. 144 Therefore, the density of the mud the rig crew pumped into the well was

not adequate to prevent the type of “fluid inversion” (swapping of fluid and

cement) that could compromise the integrity of the cement job.

API RP 65 Section 8.2 addresses well preparation using conditioning

fluids. It states that:

Well preparation, particularly circulating and conditio ning fluids in the

wellbore, is essential for successful cementing

... Common cementing best

practice is to circulate the hole a minimum volume of one bottoms

‐ up

once casing is on bottom.

As discussed in detail above, BP only partially circulated the Macondo well prior

to cementing. 145

1. Halliburton’s Primary Cementing Best Practices

Consistent with API RP 65, Halliburton’s internal cementing best practices

document also advises that full well circulation be performed prior to cementing,

that lighter weight fluid be used in the rat hole, and that adequate centralization

be installed in the well. Halliburton also recommends that, to improve the

probability of success in the prim ary cementing job, “[t]he best mud

displacement under optimum rates is achieved when annular tolerances are

approximately 1.5 to 2.0 inches.” As discussed above, the annular tolerance on

the Macondo well was only 3⁄4 inches for the production casing.

Halliburton’s best practices document also addresses ga s flow potential.

It states:

Although gas flow may not be apparent at surface, it may occur between

zones, which can damage the cement job and eventually lead to casing

143 A rat hole is the extra space drilled beyond the last hydrocarbon zone of interest so that

logging tools (used to evaluate the zone of interest) can be run.

144 BP

‐ HZN

‐ CEC0011406.

145 BP

‐ HZN

‐ MB1

‐ 00021304.59 pressure at the surface. The OptiCem program can be used as a tool to

determine the gas flow potential of any primary cement job.

While BP used Halliburton’s OptiCem model, it did not focus on the gas

flow potential issues raised by the model. In addition, Halliburton’s best

practices document re commends that a cement evaluation log be run to evaluate

the quality of the cement job. 146 As discussed below, BP did not run a cement

evaluation log for the Macondo well.

2. BP Cement Evaluation Log Requirement

In anticipation of potential fluid losses during the production casing

cement job, the BP Macondo well team positioned a logging crew and evaluation

tools on the rig to run a cement evalu ation log. A cement evaluation log is used

to enable a crew to evaluate the quality of a cement job and whether the cement

in the annular space set up successfully. If the log indicates problems with the

cement, the crew can pump additional cement to remediate the primary ceme nt

job.

BP’s Mark Hafle prepared a decision tree to determine whether BP would

run the cement evaluation log. 147 According to the decision tree, rig personnel

were to determine whether the cement placement went as planned by checking

for lift pressure of approximately 100 psi (60 psi more than expected) and

evaluating whether there had been any apparent fluid losses. Rig personnel

observed these indicators and concluded that the cement job had gone as

planned. On the morning of April 20, the BP Macondo well team decided no t to

run a cement evaluation log. 148

BP’s engineering technical practices require that personnel determine the

top of cement by a “proven cement evaluation technique” if the cement is not

1,000 feet above any distinct permeable zones. 149 The acceptable proven

techniques identified in BP’s internal guidelines are cement evaluation logs,

cement column back pressure, and temperature logs. BP’s guidelines do not

146 Halliburton Deepwater Primary Cementing: Beyond the Shallow Water Flows, Chapter 7: Post Job

Procedures and Analysis (1997).

147 BP Production Casing and TA Forward Planning Decision Tree, April 14, 2010. (BP

‐ HZN

‐ MBI00010575) (Appendix L).

148 Guide testimony, July 22

,, 2010, at 43

‐ 44.

149 BP ETP GP 10

‐ 60 Zonal Isolation Requirements During Drilling Operations and Well

Abandonment and Suspension (BP

‐ HZN

‐ MBI00193549).60 identify lift pressure or lost returns to be proven techniques for evaluating a

cement job. 150 Thus, Hafle’s decision tree on whether to direct the Schlumberger

crew to run the cement evaluation log was inconsistent with BP’s own

guidelines.

Schlumberger told the Panel that it is uncommon but not unheard of for

operators to cancel ordered services, such as cement evaluation logs, after the

crew arrives at the facility. Schlu mberger reviewed deepwater statistics for a 30

‐

month period and found that Schlumberger actually performed 71 of the 74

cement evaluations originally ordered by operators during that period.

Since the Panel concluded that the cement in annulus did not fail, it found

that BP’s decision to not perform a cement evalu ation log was not a cause in the

well failure.

150 Id.61 

### IV. Possible Flow Paths

The Panel identified three possible paths by which hydrocarbons could

have flowed up the well to the rig during the initial stage of the blowout: (1) up

the production casing annulus cement barrier and upward through the annulus

and the wellhead seal assembly; 151 (2) up the production casing and related

components from above the top wiper plug located on the float collar at 18,115

feet; or (3) up the last 189 feet of the production casing (the “shoe track”).

Scenario 1: Production Casing Annulus Cement Barrier and the Wellhead Seal

Assembly

Under this scenario, hydrocarbons would have flowed from the reservoir

up the backside of the tapered casing string, and thr ough the seal assembly into

the riser. If this had occurred, the nitrified annular cement intended to isolate the

hydrocarbon zone(s) at the production interval would have failed, the casing

would have lifted or floated, and the seal assembly wo uld have failed in

conjunction with the casing lifting. This potential flow path is illustrated in

Figure 6, below.

Figure 6

– Flow Up the Annulus and Through the Seal Assembly

151 The seal assembly is a metal element that is the interface between the casing hanger and the

wellhead.62 On April 19, the day before the blowout, BP pumped cement down the

production casing and up into the wellbore annulus above the uppermost

hydrocarbon reservoir to prevent hydrocarbons from entering the wellbore. As

discussed above, the annulus cement that was placed across the main

hydrocarbon zone was a lower density, nitr ified (foam) cement slurry. At the

time of the blowout, the seal assembly had not yet been mechanically locked to

the wellhead housing.

To analyze the probability of this scenario the Panel commissioned

Keystone Engineering Inc. (“Keystone”) to conduct a buoyancy casing analysis.

Keystone analyzed eight production casing st atic force conditions that could

have acted upon the production casing and wellhead hanger, and possibly

resulted in movement of the casing. Keystone’s analysis found that six of these

eight scenarios were unlikely to have occurred. Keystone presented two

remaining possible scenarios under which seal movement could have resulted

from well pressure and forces. However, the Panel la ter ruled out both of these

scenarios because well intervention operations following the blowout showed

that the wellhead seal assembly had, in fact, remained intact during the

blowout. 152

When the Macondo well was secured after the blowout, intervention work

began under the direction and supervision of the Unified Area Command with

input from BOEMRE, including the Panel and other federal agencies. 153 This

intervention work required the participation of companies involved in the

drilling of the original Macondo well.

During the well intervention operations, observations using remotely

operated vehicles (ROVs) found that the Macondo wellhead seal assembly was

intact. On September 9, 2010, technicians from Dril

‐ Quip Inc., a contractor

involved in the interve ntion operations, used a lead impression tool to take an

impression of the hanger and seal assembly. A lead impression tool is a high

tolerance measurement tool that is able to able to detect changes in equipment to

within fractions of an inch. Based on this lead impression, the technicians on the

Developme nt Driller II (DDII) relief well operation concluded that the 9

‐ 7/8 inch

152 Keystone Report, September 2010.

153 The Unified Area Command refers to the unified, interagency response to the Deepwater

Horizon oil spill.63 hanger and seal assembly remained properly seated in the 18

‐ 3/4 inch high

pressure housing, where it had been placed on April 19 prior to the blowout. 154

Additional evidence from the intervention operations also tends to

eliminate this first well flow scenario. On September 10, during the well

intervention operation, BP conducted a positive pressure test of the 9

‐ 7/8 inch

production casing in the Macondo well by pumping 6 bbls of 13.2 ppg drilling

mud down the BOP ki ll line and reached an instantaneous shut

‐ in casing

pressure (ISICP) of 4,270 psi. The kill line was then shut in and, after 30 minutes,

the shut

‐ in pressure remained at 4,158 psi, therefore revealing no flow through

the annulus.

On September 11, following installation of the lock

‐ down sleeve, BP

succe ssfully pressure tested the lock

‐ down sleeve seal to 5,200 psi, which

indicated that the well hanger was properly seated because otherwise, annular

flow would have lifted the hanger. 155

On September 22, Schlumberger used an isolation scanner tool to log the

characteristics of fluid in the annulus between the mud line and 9,318 feet

measured depth. 156 This log evaluated, among other things, whether the fluid in

the annulus included “free gas.” Based on the logging data, Schlumberger

determined that free gas was not present in the annulus below the BOP. The

absence of free gas in the annulus provides strong evidence that hydrocarbons

were not present in the annulus during the blowout.

On October 7, the inte rvention team perforated the 9

‐ 7/8 inch production

casing between 9,176 feet and 9,186 feet to monitor pressure and returns. 157 The

drilling mud in the interior of the casing at the time was approximately 14.3 ppg

synthetic

‐ based mud (“SBM”). Hydrocarbons, if present in the annulus, would

have exhibited a much lower density. When fluids of different densities meet at

an opening, gravity and the “u

‐ tube” effect typically cause the mo re dense fluid

154 DDII IADC Report, 9/11/10 (TRN

‐ USCG_MMS

‐ 00043342).

155 DDII IADC Report, 9/11/10 (TRN

‐ USCG_MMS

‐ 00043342). A “well hanger” is a long string of

production casing that hangs from a casing hanger inside the wellhead.

156 DDII IADC Report 9/22/10

‐ TRN

‐ USCG_MMS

‐ 00043388. An isolation scanner tool is used to

evaluate a cement job by taking measurements to help distinguish solids from liquids in the

wellbore. The tool can identify potential channeling and can evaluate whether a cement job has

achieved zonal isolation.

157 DDII IADC Report 10/7/10 (TRN

‐ USCG_MMS

‐ 00043449). This was done using a perforating

gun and well testing equipment.64 to flow into the space occupied by the lower density fluid. No “u

‐ tube” flow of

the 14.3 ppg mud from the casing to the annulus occurred on October 7,

indicating that hydrocarbons were not present in the annulus. 158

After the BOP stack was recovered from the seabed, pictures taken from

the DDII relief well rig of the hanger and seal assembly showed no erosion. Had

hydrocarbons flowed up the annulus, the outside of the hanger and seal

assembly likely would have shown effects of erosion due to hydrocarbon flow.

Because the evidence does not support the th eory that hydrocarbons

flowed up the annulus, the Panel concluded that the nitrified cement slurry used

in the annulus likely did not fail.

Scenario 2: Production Casing and Related Components from above the Top

Wiper Plug at 18,115 feet

Under this scenario, hydrocarbons would have flowed from the reservoir

through the crossover joint of the tapered casing string, into th e well and up the

riser to the rig. The Panel considered the crossover point to be a possible source

of flow because it was manufactured separately from the other tubular elements

in the well. If hydroca rbons had flowed in this path, it would mean that the

annular cement isolating the hydrocarbon zones at the production interval had

failed and the casing had failed at the crossover joint. These failures would have

resulted in hydrocarbon flow out of the well and up the riser. This scenario is

depicted in Figure 7 below:

158 “U

‐ tubing,” or reverse flow, occurs when fluids flow in the reverse direction and back up the

inside of the casing. The “u

‐ tube effect” is the practice of putting a dense slugging pill (mud that

is more dense than the mud in the drill pipe and the wellbore annulus) into the drill pi pe in order

to pull a dry string. The pill is pumped to the top of the drill string to push mud downward, out

of the pipe, thus keeping the upper strands of the pipe empty.65 Figure 7

– Flow Up the Annulus and Through Production Casing Crossover Joint

After cementing the production casing, the Deepwater Horizon crew

conducted a successful 2,500 psi positive casing test against the top wiper plug. 159

Although this pressure test (250 psi low/2,500 psi high) did not confirm a seal

below the top wiper plug at the top of the float collar, it did provide evidence

that the 9

‐ 7/8 x 7 inch production casing and related components that comprise

this string above the top wiper plug were most likely le ak

‐ free.

Like Scenario 1, Scenario 2 posits that hydrocarbons flowed through the

annulus. Forensic evidence gathered during well intervention efforts casts

substantial doubt on this theory. As discussed above, the Panel found no

evidence of erosion of the hanger and seat assembly. Had hydrocarbons flowed

along th is path, erosion effects likely would have been visible. In addition, as

mentioned above, logging data show that free gas was not present in the annulus

below the BOP.

For all of these reasons, the Panel does not believe that Scenario 2

represents a likely explanation for the flow path of hydrocarbons during the

blowout.

159 Smith Report at 8.66 Scenario 3: Production Casing Shoe Track

Under this scenario, hydrocarbons would have flowed from the reservoir

through the casing shoe, into the well and up the riser to the rig. For this flow

path to have occurred, the shoe track cement would have failed. A number of

factors could have caused the shoe track cement to fail. First, mud in the

wellbore could have contaminate d the shoe track cement and caused the cement

not to set properly. Second, the shoe track cement might have swapped out with

the lighter drilling fluid in the rat hole. Third, some of the shoe track cement

could have been lost into the formation. Finally, th e failure of the shoe track

could have resulted from a combination of these factors. This scenario is

represented in Figure 8 below.

Figure 8

– Flow up the Production Casing Shoe Track

The approximately 189 foot bottom section of the casing in the well, called

the shoe track, consisted of sections of casing with a reamer

‐ guide shoe at the

bottom and a dual flapper float collar on top. These sections of casing that ma ke

up the shoe track are meant to contain the top, or tail cement, which in the

Macondo well was unfoamed cement.67 The shoe track was designed to prevent u

‐ tubing in two ways: (1) the

presence of 189 feet of cement as a barrier and (2) the float collar’s flow dual

flapper valves were designed to allow only one

‐ way flow after conversion.

The float collar dual flapper arrangement is designed to close after the

cement is in place (and starts setting up) to prevent any flow

‐ bac k into the casing

(and up the well) caused by hydrostatic pressure differences between the dense

cement and drilling mud on the outside of the casing and the less dense

displacement fluid on the inside. The float collar also act s as the landing point

for the cementing plugs used during the job. The float collar employed a

differential fill tube that allowed mud to flow into the casing as it was run into

the well. The fill tube in this case was designed to be pumped out of the float

collar if the pump rate was highe r than five barrels per minute. The position of

the top of the float collar located at 18,115 feet placed the float collar across the

productive reservoir between 18,083 feet and 18,206 feet measured depth.

As described above, the crew had difficulty converting the float collar and

may not ha ve achieved conversion despite making nine attempts. There are

three possible reasons for the failure of the float collar: (1) the high load

conditions required to establish circulation damaged the float collar; (2) the float

collar failed to convert due to insufficient flo w rate; and (3) the check valves on

the float collar failed to seat due to damage, contamination, or the presence of

debris. None of these float collar failure scenarios excludes the possibility that

the cement could have failed due to defective cement design, contamination of

the cement by mud in the wellbore, commin gling of cement with nitrogen due to

nitrogen breakout from the nitrified foam cement slurry, swapping of the shoe

track tail cement with the heavier mud in the rathole, a clogged reamer shoe that

possibly altered cement flow

‐ out of the reamer shoe, or some combination of

these factors.

The forensic examination of the BO P stack found interior erosion of the

blind shear rams, which supports this flow path as the most likely scenario. This

erosion detected on the blind shear rams likely resulted from the high pressure

flow of hydrocarbons past the rams as a result of the blowout and indicates that

hydrocarbons flowed up the well after entering thr ough the shoe track.68 

### V. Conclusions on Well Design, Cementing, and Flow Path

A. Cause of the Failure of the Cement Barrier

Contamination or displacement of the shoe track cement, or nitrogen

breakout or migration, could have caused the shoe track cement barrier to fail.

The Panel found evidence that the most likely reason the shoe track cement

slurry failed is due to contamination in the rat hole portion of the wellbore and

inversion of fluids due to different densities (the mud in the shoe track was

lighter th an the unfoamed cement slurry). However, the Panel could not

definitely rule out nitrogen breakout, migration, or over

‐ displacement in the

shoe track. The Panel concluded that a com bination of contamination, over

‐ displacement, and/or possibly nitrogen breakout of the shoe cement were

causes of the blowout.

Contamination of the foamed cement in the annulus by the mud, base oil

or cement spacer could have resulted in nitrogen breakout, leading to a failure to

achieve zonal isolation of hydrocarbons in the annulus. The Panel concluded,

based upon its review of forensic evidence that established the absence of free

gas in the annulus, that contam ination or nitrogen breakout did not affect

zonal isolation in the annulus.

B. Contributing Causes of the Cement Barrier Failure

Macondo was an exploratory well with limited offset data, and the

differences between calculated and actual pore pressures caused BP to make

revisions to the drillin g program and casing setting depths, including the depth

at which BP set the production casing. BP’s internal guidelines stated that

drilling would not be stopped in a hydrocarbon interval, unless doing so was

necessary because of operational/pressure/safety issues. BP’s decision to set the

casing was based on well integrity concerns and a potential safety issue

associated with a zero drilling margin based on 14.1 ppg pressured formation

sand combined with a 12.6 ppg formation pressured zo ne in the same open

‐ hole

section taking losses. Additionally, the production casing string shoe was set in

a laminated sand

‐ shale interface at 18,304 feet measure d depth, instead of at a

consolidated shale strata. Placement of the shoe in a laminated sand

‐ shale zone

increased the likelihood of channeling or cement contamination. The decision to

set the production casing in a laminated sand

‐ shale zone in the vicinity of a

hydrocarbon interval was a contributing ca use of the blowout.69 The mud losses of approximately 15,500 bbls during drilling at Macondo

indicated that BP should have taken additional precautions during the

production casing cementing operation. With the known losses experienced in

the well, BP’s failure to take additional precautions, such as establishing

additional barriers during cementing, was a contributing cause of the blowout.

As discussed above, API RP 65 contains recommende d practices

regarding cementing operations that, at the time of the Macondo blowout, were

used by many operators drilling wells in deepwater in the Gulf of Mexico. Some

of the steps that BP took during the cementing of the Macondo pro duction casing

were not consistent with API RP 65 recommended practices, including the

following:

 BP did not circulate a minimum volume of one bottoms

‐ up (the volume

needed to be pumped to push the mud at the bottom of the wellbore to

the surface) once the casing was on bottom, and the mud conditio ning

volume was less than one annular volume;

 With the casing shoe not run to the bottom, BP did not fill the “rat hole”

with a higher weight mud capable of preventing cement from falling into

the rat hole and thereby displacing rat hole fluid into the cement colu mn

and compromising the cement’s properties; and

 The hole diameter was less than three inches greater than the casing

outside diameter.

With respect to the production casing cement job, BP and Halliburton did

not employ the industry

‐ accepted recommended practices described above. BP

and Halliburton’s failure to perform the production casing ceme nt job in

accordance with industry

‐ accepted recommendations as defined in API RP 65

was a contributing cause of the blowout.

BP chose to land the float collar across a hydrocarbon

‐ bearing zone of

interest in the Macondo well, instead of at the bottom of the shoe. If the float

collar had been at the bottom of the shoe, the cement jo b would likely have been

more overbalanced (i.e., greater pressure from the cement relative to the

pressures from the well). This increased overbalance would likely have allowed

the rig crew more time to recognize that hydrocarbons were flowing in the well

and more opportunitie s to take measures to control the well. BP’s decision to set70 the float collar across the hydrocarbon

‐ bearing zones of interest, instead of at

the bottom of the shoe, was a contributing cause of the blowout.

The Panel found no evidence suggesting that BP shared with the

Deepwater Horizon rig crew or Transocean shore

‐ based personnel any of the

information available to BP regarding specific risks associated with the Macondo

production casing cement job

– including the decisions noted abov e that the

Panel determined were causes or contributing causes to the blowout. BP’s

failure to inform the parties operating on its behalf of all known risks

associated with Macondo well operations was a contributing ca use of the

blowout.

BP made a series of decisions during the days leading up to the blowout

without having appropriately analyzed all available information or having first

developed certain critical information, including: (1) going forward with the

production casing cement job without analyzing compressive strength results

from Halliburton; (2) proceeding with the cement job despite failing to fully

analyze and evaluate the gas flow potential values in Halliburto n’s OptiCem

reports; and (3) directing the rig crew to pump cement into the well without

referring to data available to engineers onshore that blockage in the collar may

have been present during float c ollar conversion. BP’s failure to appropriately

analyze and evaluate risks associated with the Macondo well in connection

with its decision making during the days leading up to the blowout was a

contributing cause of the blowout.

BP did not place any cement on top of the wiper plug. This additional

cement would have created another barrier to prevent flow up the productio n

casing that could have been pressure and weight tested. BP’s failure to place

cement on top of the wiper plug was a contributing cause of the blowout.

C. Possible Contributing Causes of the Cement Barrier Failure

The float collar model used in the Macondo well was not as debris

‐

tolerant (and therefore was more susceptible to blockages) as other models that

were available and would have been more suitable in light of the kn own

challenges with the Macondo well. BP’s decision to use a float co llar that was

not sufficiently debris

‐ tolerant was a possible contributing cause of the

blowout.71 On the Macondo well, BP had the option to temporarily abandon the well

without setting a production casing, as it had done previously with the Kodiak,

MC 727, Number 2 and Tiber, KC 102, Number 1 wells when faced with similar

narrow drilling margins and lost returns at total depth. BP’s decision to set

casing in the production interva l with known drilling margin limits at total

depth was a possible contributing cause of the blowout.

During the production casing cementing operation, rig personnel

continuously monitored the fluids that they pumped into

– and that flowed out

of

– the well. But rather than measuring flow

‐ in directly, rig pers onnel

calculated flow

‐ in based on the pump’s piston volume output and efficiency.

The crew measured flow

‐ out based on the Transocean flow meter paddles and

the Sperry

‐ Sun flow line sonic/radar sensors. The crew also monitored flow

‐ out

by pit gain volumes. As discussed above, even with properly calibrated flow

measurement devices, there would have been a 10 percent margin of error in th e

flow

‐ out calculations. Dr. Smith, the expert retained by the JIT, used both the

main pit volume data and the calculated cumulative flow

‐ out versus flow

‐ in data

to estimate that approximately 2.3 bbls of mud were lost during th e production

casing cementing operation. The Panel used actual flow values to calculate that

the losses amounted to approximately 80 bbls (+/

‐ 10% based on flow

‐ in /flow

‐

out data). The fact that the Deepwater Horizon crew did not have available to

them accur ate and reliable flow

‐ line sensors during cementing operations in

order to determine whether they were obtaining full returns was a possible

contributing cause of the blowout.

There were a number of limitations in the cementing plan that could have

contributed to the compromise of the ceme nt job, including the following:

 Reducing the bottoms up circulation from 2,760 bbls to approximately 350

bbls could have increased the likelihood of channeling because: a) there

was less cleaning of the wellbore, and b) the reduced bottoms up

prevented rig personnel from examining, prior to cementing, the mud for

potential c ontamination by hydrocarbons;

 Pumping cement at the relatively low flow rate of 4 bpm could have

decreased the efficiency with which cement displaced the mud from the

annular space, thereby increasing the potential for channeling; and72  Limiting the volume of cement to approximately 51 bbls meant that any

contamination of the cement by mud could reduce the effective coverage

of annular and/or shoe track cement.

These decisions by BP and Halliburton with respect to planning and

conducting the Macondo production casing cement job were possible

contributing causes of the blowout.

BP’s well si te leaders and the Deepwater Horizon rig crew failed to

recognize the accumulating risk associated with several possible anomalies that

could have contributed to the shoe track cement’s failure to prevent hydrocarbon

ingress into the well. These problems include:

 The higher pressure needed to convert the float collar from “fill” to

“check” (3,142 psi instead of a ma ximum of 700 psi) could have damaged

components of the float collar (including the auto

‐ fill tube and shear pins);

 The float collar may not have converted because the crew used an

insufficient flow rate and pressure. The float collar was designed to

convert at a range between 5 bpm and 7 bpm, while the actual flow rate

never exceeded 4.3 bpm;

 The bottom cement wiper plug that landed on the float collar required 900

psi to 1,100 psi to burst the disk. However, the burst disk did not rup ture

until 2,900 psi was applied, which indicated that there may have been a

blockage in the float collar;

 The check valves on the float collar may not have properly sealed as a

result of damage to the flapper valve pins, or related components, or may

have only partially sealed as a result of debris across the seal areas;

 Lost circulation material or other debris in the mud syst em could have led

to the need to use increased pressure to convert the float collar. If debris

was present, there would be no assurance that conversion could be

achieved even with the use of higher pressur es;

 The shoe track cement may have been contaminated by mud in the rat

hole swapping out with the cement, due to a density differences between

the cement and the mud; and

 Except for a couple of surges or spikes, the flow rate use d by the crew was

too low to convert the float collar.

The failure of BP’s well site leaders and the Transocean Deepwater Horizon rig

crew to recognize the risks associated with these multiple problems that73 occurred between April 19 and April 20 was a possible contributing cause of

the blowout.

D. Flow Path Cause

1. Production Casing Annulus Cement Barrier and the 9

‐ 7/8 Inch

Wellhead Seal Assembly

As discussed above, the following evidence weighs against the possibility

that hydrocarbons flowed through the pro duction casing annulus cement barrier

and the 9

‐ 7/8 inch wellhead seal assembly:

1) On September 9, 2010, Dril

‐ Quip technicians confirmed with a lead

impression tool that the 9

‐ 7/8 inch wellhead seal assembly remained

properly seated in the 18

‐ 3/4 inch high pressure housing, where it had

been placed on April 19, 2010 prior to the flow of hydr ocarbons.

2) On September 10, BP conducted a 30

‐ minute pressure test of the 9

‐ 7/8 inch

production casing annulus that confirmed the lack of annular

communication.

3) On September 11, the lock

‐ down sleeve seal was successfully pressure

tested to 5,200 psi, which tended to prove that the hang er was properly

seated.

4) On September 22, Schlumberger’s logging data determined that “free” gas

was not present below the BOP to 9,318 feet measured depth.

5) On October 7, BP’s perforation of the 9

‐ 7/8 inch casing between 9,176 feet

and 9,186 feet found that no u

‐ tube flow occurred from the casing to

annulus.

6) During well interventi on operations, ROV observation determined the

wellhead seal assembly was intact. In addition, subsequent to removing a

portion of the 9

‐ 7/8 inch production casing, original 13.8

‐ 14.0 ppg mud

was discovered between the 16 inch intermediate casing and 9

‐ 7/8 inch

production casing.

7) Pictures taken from the DDII relief well rig at the time the hanger and seal

assembly were extracted from outside hanger and seal assembly showed

no signs of erosion from annular flow.

Based on this evidence, the Panel concluded that hydrocarbons did not flow

from the production casing annulus ceme nt barrier and the 9

‐ 7/8 inch wellhead

seal assembly during the blowout.74 2. Production Casing and Related Components from above the Top

Wiper Plug at 18,115 Feet

The 9

‐ 7/8 x 7 inch production casing and related components (including

the 9

‐ 7/8 x 7 inch cross

‐ over sub and centralizer subs) were successfully pressure

tested (250 psi low/2,500 psi high) from abo ve the top wiper plug at 18,115 feet.

On September 10, BP conducted a 30

‐ minute pressure test of the 9

‐ 7/8 inch

production casing annulus that confirmed the lack of flow from the annulus. On

October 7, 2010, BP perforated the 9

‐ 7/8 inch casing between 9,176 feet and 9,186

feet and determined no u

‐ tube flow occurred from the casing to annulus. Based

on this evidence, the Panel concluded that the well flow did not occur from

inside the 9

‐ 7/8 x 7 inch production casing or its re lated components ( including

the 9

‐ 7/8 x 7 inch cross

‐ over sub and centralizer subs) from above the top wiper

plug at 18,115 feet.

3. 9

‐ 7/8 Inch Production Casing Shoe Track

Based on th e elimination of the potential flow paths from the previous

scenarios, the examination of the blind shear rams that showed interior erosion,

presumably from the high

‐ pressure flow of hydrocarbons past the rams in the

period after the well event, and th e findings contained in the Keystone

Engineering Report, the Panel concluded that the most likely path of

hydrocarbons during the blowout was through the shoe track. The Panel

concluded that hydrocarbon flow during the blowout occurred through the 9

‐

7/8 x 7 inch production casing from the shoe track as a result of float collar and

shoe track failure

.75 

### VI. Challenges at the Macondo Well

BP and Transocean encountered a number of problems during drilling

and temporary abandonment operations at the Macondo well

– including kicks,

stuck pipe, lost returns, equipment leaks, cost overruns, well scheduling and

logistical issues, personnel changes and conflicts, and last minute procedure

changes. These problems led rig personnel and others to refer to Macondo as the

“well from hell.” 160

A. Kicks and Stuck Drill Pipe

BP company records and testimony from rig personnel establish that at

least three well control events and multiple kicks occurred during drilling and

temporary abandonment operations at the Macondo well. The first well control

event occurred on October 26, 2009, when the well was being drilled by

Transocean’s Mar ianas rig. The second well control event occurred on March 8,

2010, after the Deepwater Horizon had replaced the Marianas and resulted in a

stuck drill pipe.

It took the crew at least 30 minutes to detect the March 8 kick. 161 This

delay raised significant concerns among BP personnel overseeing the operation

about the ability of personnel on the Deepwater Horizon to promptly detect kicks

and take appropriate well control actions.

In a post

‐ blowout interview, John Guide, a BP wells team leader, stated

that, at the time (March 2010) he was concerned that the Deepwater Horizon team

had become “too comfortable” with itself because of its good track record for

succe ssfully drilling difficult wells, and that its members missed potential

indications of problems during the March 8 event that they should have

caught. 162

Other individuals responsible for operations at Macondo expressed

concern about the events of March 8:

160 Testimony of Mike Williams, Joint Investigation Hearing, July 23, 2010, at 35 (stating that the

Deepwater Horizon crew had used the name “well from hell” on a prior well and also used the

term on the Macondo well because on both wells the crew encountered similar lost circulation,

stuck pipe, and kic k problems).

161 BP

‐ HZN

‐ MBI00221686.

162 BP

‐ HZN

‐ BLY00125447.76  David Sims, BP drilling and completions operations manager, expressed

concern about the BP well site leaders’ well control abilities in an email

written following the March 8 kick. He stated that the well site leaders

“are not well control experts. They are fantastic drillers

– the best in the

SPU [BP drilling unit], if not the industry. However, they do not c irculate

out kicks for a living, especially 1200 feet off bottom with many

unknowns.” 163

 Mark Hafle told BP investigators in a post

‐ blowout interview that he

believed some of the Sperry

‐ Sun mudloggers did not understand how to

monitor the well properly, and that the Sperry

‐ Sun personnel were

stretched too thin and did not have enough qualified mudloggers. 164

Notwithstanding the high level of concern about the March 8 kick and the

rig crew’s response to the kick, BP did not conduct the type of investigation of

the incident required by BP’s own policies. BP’s drilling and well operations

procedures require a well control incident report to be completed and

documented in BP’s internal reporting system 165 and provide that such incidents

should be investigated to determine root causes and to identify ways to prevent

reoccurrence. 166 The Panel found no evidence that BP documented the March

well control event in its internal tracking system or that it conducted a post

‐

incident investigation to determine the root cause of the delayed kick detection.

Instead of conducting a formal investigation, Guide had discussions with

the BP well site leaders and the Transocean rig leaders about the event and th e

drilling crew’s response. Guide told BP investigators in a post

‐ blowout

interview that he believed members of the rig crew understood their

responsibilities and admitted to him that they “had screwed up” by not catching

the kick. Guide also talked to the Sperry

‐ Sun mudloggers about the detection of

flow. 167

BP’s in

‐ house group of geological experts, the “Totally Integrated

Geological and Engineering Response team” (the “TIGER team”), conducted an

163 BP

‐ HZN

‐ MBI00222540.

164 BP

‐ HZN

‐ BLY00125470. As discussed previously in this Report, mudloggers have a

responsibility to monitor the conditions in the well during drilling operations. Monitoring for

potential kicks is among the mudloggers’ most important responsibilities.

165 BP DWOP Manual, Section 15.2.12, BP

‐ HZN

‐ MBI00130846.

166 BP DWOP Manual, Sections 3.1.5, BP

‐ HZN

‐ MBI00130817.

167 BP

‐ HZN

‐ BLY00125447.77 analysis of the March 8 kick. This was not the type of incident investigation

required by the DWOP, but rather a study of the pore pressure and other

geological conditions encountered in the well. In an email “re

‐ evaluating how

we manage real time pore pressure detection for Macondo type wells,” a BP

geologist stated that “we need to have PP [pore pressur e] conversations as soon

as ANY indicator shows a change in PP” and we “need to be prepared to have

some false alarms and not be afraid of it.” 168 He also noted:

Better lines of communication, both amongst the rig subsurface and

drilling personnel, and with Houston office need to be reestablished.

Preceding each well control event, subtle indicators of pore pressure

increase were either not recognized, or not discussed amongst the greater

group. It is the responsibility of th e mudloggers and well

‐ site PP/FG

personnel to openly communicate with the well

‐ site geologist. 169

This analysis by the TIGER team, which was focused on geological conditions in

the Macondo well, was not intended to address the specific ways in which the rig

crew should monitor the well. Morel, Hafle and Cocales presented a document

to the TIGER team on March 18 that addressed some of the events of March 8,

but this document did not includ e a discussion of any measures to be

implemented to ensure that the rig crew could detect kicks more quickly and

effectively. 170 The Panel found no evidence that Morel, Hafle, and Cocales

presented information related to the March 8 kick detection problems to anyone

else involved in operations at Macondo.

After the March 8 incident, BP had to abandon the wellbore (leaving

behind a number of costly drilling tools) and perform a bypass to continue

drilling the well. 171 Responding to the kick and conducting the bypass operation

resulted in additional cost and timing delay for the Macondo well.

Except for one person, the rig personnel involved in kick detection and

response on March 8, including a mudlogger, drillers, assistant drillers, a senior

toolpusher, and toolpushers, were the same individuals on duty on April 20

when the blowout occurred. 172

168 BP

‐ HZN

‐ MBI00113015.

169 BP

‐ HZN

‐ MBI00113017.

170 BP

‐ HZN

‐ BLY00036098.

171 A bypass or sidetrack operation is performed by drilling a directional hole to bypass an

obstruction in the well.

172 One of the mudloggers on duty on April 20 was not involved in the March 8 kick.78 B. Scheduling Conflicts and Cost Overruns

As the Deepwater Horizon crew prepared to complete operations at the

Macondo well, they were significantly behind schedule. BP stated, in a

submission to MMS, that the Deepwater Horizon would arrive at BP’s Nile well

(the next well after Macondo that the Deepwater Ho rizon was scheduled to work

on) by March 8, 2010. 173 By early 2010, it became clear to BP that this schedule for

the Deepwater Horizon rig would not hold.

In addition, as discussed previously in this Report, by the time of the

blowout, BP had exceeded its original budget for the Macondo well by $58.34

million. The Panel collected and reviewed evidenc e showing that BP personnel

were aware of the cost overruns and were concerned about incurring additional

costs that they deemed unnecessary. John Guide’s testimony suggests that his

effectiveness at reducing costs was part of the evaluation of his performance as

wells team leader. 174 Correspondence between Guide and others suggested his

awareness of others’ evaluation of his effectiveness in containing costs. For

example, on April 20, Guide responded to an email request from Ross Skidmore,

a BP contractor, to conduct a standard procedure that would increase the

likelihood of a successful lock

‐ down sleeve installation

– a “wash run” that

would “avoid a bad LIT [lead impression to ol] impression”

– by saying “[w]e

will never know if your million dollar flush run was needed. How does this get

us to sector leadership.” 175

The Panel found evidence that BP’s decision to have the Deepwater Horizon

crew install the lock

‐ down sleeve, discussed in more detail below, was motivated

by cost

‐ savings. A lock

‐ down sleeve is a piece of equipment necessary for the

production of a well. It connects and holds the production casing to the

wellhead duri ng production, thereby protecting the connection from the

pressures generated by a flowing well. Lock

‐ down sleeves are often installed by

lower cost rigs that are used mainly for completion work instead of by a drilling

rig like the Deepwater Horizon

. Email correspondence reveals that BP did not

initially intend to hav e the Deepwater Horizon install the lock

‐ down sleeve, but

then changed course when it was shown that doing so would likely save 5.5 days

173 APM submitted by BP to the MMS (Agency Tracking ID: EWL

‐ APM

‐ 123805).

174 Guide Testimony, October 7, 2010, at 142

‐ 43.

175 BP

‐ HZN

‐ MBI00258507.79 of rig time and approximately $2.2 million. 176 As discussed below, this cost

‐ saving decision may have led to further complications encountered during the

temporary abandonment procedures that were underway when the blowout

occurred.

C. Personnel Changes and Conflicts

During the drilling of the Macondo well, BP experienced a number of

personnel issues related both to a recent reorganization of operational functions

and personnel and to personal conflicts among employees with significant

responsibilities for drilling operations at Mac ondo.

In April 2010, BP began to implement a reorganization that involved

multiple personnel changes among those with responsibilities for operations at

Macondo. The reorganization, among other things: (1) eliminated the wells

director po sition; (2) changed the reporting responsibilities of the wells team

leader; and (3) moved an operations engineer under the direct supervision of the

drilling engineer team lead. At the time of the blowout, nine BP employees with

responsibilities for drilling operations at the Macondo well had been in their

current positions for le ss than six months. 177

BP witnesses testified that the reorganization did not affect their roles or

responsibilities. Information from contemporaneous documents and witness

interviews, however, tell a different story. From February through April 2010, a

number of different individuals with responsibility for the Macondo drilling

operations expressed concerns about the reorganization in general and, in

particular, about John Guide’s rol e in light of the reorganization. Guide had

previously been at the same level as David Sims, BP drilling and completions

operations manager, but after the reorganization he reported to Sims.

Two of Guide’s colleagues expressed concerns about his reaction to the

reorganization. According to interview notes from BP’s investigation, Gregg

Walz, a BP drilling engineer team leader, stated that Guide “put Ops first and

was concerned about distractions associate d with the functional

reorganization.” 178 Jon Sprague, BP drilling engineering manager for the Gulf of

176 BP

‐ HZN

‐ MBI00097490.

177 The vice president of drilling and completions; wells manager; drilling engineering manager;

drilling and completions operations manager; drilling engineer team lead; drilling engineer; two

well site leaders at the Deepwater Horizon ; and the future well site leader at the Deepwater Horizon

.

178 BP

‐ HZN

‐ BLY00061325.80 Mexico, testified that he “was concerned that John [Guide] may not be

comfortable with the new organization.” 179

In March 2010, around the time of the second loss of well control at

Macondo, there was tension between Sims and Guide. In an email dated March

13, Guide complained to Sims and accused him of making up his mind on

corrective actions without listening to input from the well site leaders. In

response, Sims said that “we cannot fight ab out every decision” and that “I will

hand this well over to you in the morning and then you will be able to do

whatever you want. I would strongly suggest, for everyone’s sake, that you

make logical decisions, based on facts, after weighing al l the opinions.” 180

Sims also drafted an email that was addressed to Guide but was never

sent. In the email, Sims stated the following about Guide:

 You seem to love being the victim. Everything is someone else’s fault.

You criticize nearly everything we do on the rig but don’t seem to

realize that you are responsible for everything we do on the rig.

 You will not call the ri g in the ops room. You have to sneak out of the

room and call them on your cell phone or go back to your office while

everyone is in the ops room.

 You can’t sit in a meeting and listen to other s’ opinions without

arguing with them. You think when somebody has an opinion that

they are demanding action. You complain that a bunch of young

engineers are throwing out all kinds of wild ideas and that it is driving

you crazy. You don’t list en. You key on a random word or phrase and

then you fixate on that and don’t hear anything else. You are always

defensive and the victim. You seem to not want to make a decision so

that you can criticize it later. 181

During the weeks leading up to the blowout, Guide appeared to have

problems handling his responsibilities for operations at Macondo.

Notwithstanding the fact that, at the time, he was “very upset” about the March

179 Testimony of Jon Sprague, Joint Investigation Hearing, December 8, 2010, at 246.

180 BP

‐ HZN

‐ MBI00222521.

181 BP

‐ HZN

‐ MBI00222540.81 8 kick event, 182 Guide did not take steps to ensure that it was fully investigated.

According to Sims, Guide was not appropriately engaged in the efforts to deal

with the stuck drill pipe after the kick. 183

The Panel found no evidence that Sims took affirmative or specific steps to

address the problems he identified with Guide’s performance. Instead, Sims

simply made a general plea to Guide, asking him to “make logical decisions,

based on facts, after weighing all the opinions.” 184

In addition to the tension between Sims and Guide, there were other

organizational challenges that frustrated personnel with responsibilities for

Macondo operations. For example, just days before the blowout, Guide said,

“[w]ith the separation of engineering and operations I do not know what I can

and can’t do. The operation is not going to s ucceed if we continue in this

manner.” 185 Additionally, Brett Cocales testified about concerns related to his

transfer to the engineering department. 186 Cocales testified that his upcoming

transfer would move resources from the operations group to the engineering

group.

Recognizing the organizational challenges present with the Macondo

team, on March 21, 2010, Pat O’Bryan, BP’s Vice President of drilling and

completions, emailed BP drilling and completions personnel and asked them to

be prepared to discuss operations issues, in cluding “the challenges that we’ve

had over the last few weeks.” In the email, O’Bryan listed several items he

wanted to discuss, and one of the items was “just in time delivery of well plans.”

Sims’ draft email response stated “Nothing is going to change! All leadership,

Ops DEs, etc. Lots of stress in the system.” 187

In the weeks leading up to April 20, BP made further changes to the

Macondo well team. In early March, BP wells manager Ian Little was out of the

office, as was Sims. Little delegated his duties to Guide. Guide’s duties at the

time included the responsibility for ensuring an investigation in to the causes of

the March 8 kick was conducted. 188 Cocales assumed Guide’s responsibilities

182 BP

‐ HZN

‐ MBI00125458 (post

‐ incident interview notes).

183 BP

‐ HZN

‐ MBI00222540.

184 BP

‐ HZN

‐ MBI0022252.

185 BP

‐ HZN

‐ MBI00255906.

186 Cocales testimony at 271

‐ 72.

187 BP

‐ HZN

‐ MBI00265306.

188 Testimony of Ian Little, Joint Investigation Hearing, April 7, 2011, at 38.82 when Guide took time off after his father’s death. 189 Those responsibilities

included investigation of the March 8 kick incident.

On April 6, Keith Daigle, BP well operations advisor, notified Guide that

Bob Kaluza would replace Ronnie Sepulvado as one of the two BP well team

leaders on the Deepwater Horizon so that Sepulvado could attend well control

training. 190 Kaluza had four years of deepwater drilling experience but minimal

experience with the Deepwater Horizon rig.

Meanwhile, the problem of “just in time delivery of well plans,” which

O’Bryan expressed concerns about, continued. In a post

‐ blowout interview,

Gregg Walz stated that, at the time, he “was concerned about last minute

changes and he wanted to get work done ear lier.” 191 On April 12, Sepulvado

emailed Brian Morel to ask for temporary abandonment procedures. 192 Morel’s

subsequent emails revealed that he still had not completed the temporary

abandonment procedures and was still not sure whether the Macondo drilling

team would set the lock

‐ down sleeve during temporary abandonment. 193

There was evidence that members of the Macondo team were concerned

about operations at Macondo. Morel emailed his wife on April 14 that he had to

go offshore to the Deepwater Horizon rig because “our normal WSL [well site

leader] is heading in and the new guy is good, but not in tune with the well so I

need to go out and make sure they follow every step as any deviations could

lead to us not getting a good cement job and having to do a lot of remedial

operations.” 194

In the days immediately prior to the blowout, the contentious emails

between Guide and Sims continued. On April 15, Sims emailed Guide to see if

he could meet with him the following morning, and Guide responded by asking

Sims if he was going to be fired. In the same email, Sims asked whether he

needed to “delegate” Guide’s wo rk since Guide had been out of the office and

Sims did not know where he was. 195 At this time, the Macondo team was

working on critical cementing procedures and needed input from Guide.

189 BP

‐ HZN

‐ MBI00214540.

190 BP

‐ HZN

‐ MBI00241455.

191 BP

‐ HZN

‐ BLY00061325.

192 BP

‐ HZN

‐ MBI00199122.

193 BP

‐ HZN

‐ MBI00126145; BP

‐ HZN

‐ MBI00126333.

194 BP

‐ HZN

‐ MBI00329028.

195 BP

‐ HZN

‐ MBI002543828; BP

‐ HZN

‐ MBI00254858.83 On April 17, Guide wrote to Sims:

David, over the past four days there have been so many last minute

changes to the operation that the WSL’s have finally come to their wits

end. The quote is ‘flying by the seat of our pants.’ More over, we have

made a spe cial boat or helicopter run everyday. Everybody wants to do

the right thing, but this huge level of paranoia from engineering

leadership is driving chaos. This operation is not Thunderhorse. Brian

has called me numerous times trying to make sense of all the insanity.

Last night’s emergency revolved around the 30 bbls of cement spacer

behind the top plug and how it wo uld affect any bond logging (I do not

agree with putting the spacer above the plug to begin with). This morning

Brian called me and asked my advice about exploring opportunities both

inside and outside of the company.

What is my authority? With the s eparation of engineering and operations

I do not know what I can and can’t do. The operation is not going to

succeed if we continue in this manner. 196

The Panel found no evidence that any of the issues raised by Sims and

Guide regarding Guide’s performance, the lack of clear authority and reporting

lines, and management of changes to the operation were resolved or even

meaningfully addressed prior to April 20.

D. Safety Stand

‐ down

Events around a proposed so

‐ cal led safety stand

‐ down on the Deepwater

Horizon reinforced the fact that there were significant problems with oversight of

rig operations and communications. Ronnie Sepulvado, one of the BP well site

leaders on the rig at the time, notified Guide on April 10 of a first aid incident

aboard the Deepwater Horizon

, whic h involved a roustabout sustaining an injury

to his left leg from a load being lifted by a crane. Guide and Sims discussed the

incident, and Guide suggested a “safety stand down tomorrow so we can get our

act together.” Sims agreed with the idea of a stand

‐ down, and he a dded

196 BP

‐ HZN

‐ MBI00255906. The allocation of responsibilities between operations and engineering

were outlined in a document that BP referred to as a “RACI” chart. See Appendix K.84 “[h]appy to take as much time as you think. 2 first aids and 2 drops in 2 weeks is

worth a timeout.” 197

Following the discussion about the stand

‐ down, Guide sent an email to

Paul Johnson, a Transocean rig manager with responsibility for the Deepwater

Horizon

, informing Johnson that it was “probably time to step back for an hour or

two. Let’s make sure the crew is engaged.” Johnson agreed and told Guide they

would have a safety st and

‐ down with both crews to discuss planning. 198 The

Panel found no evidence that indicated a safety stand

‐ down actually occurred

outside of the crew’s daily safety meeting, which generally lasted only a few

minutes.

197 BP

‐ HZN

‐ MBI00249509.

198 BP

‐ HZN

‐ MBI00249524.85 

### VII. Temporary Abandonment of the Macondo Well

At the end of drilling operations, the rig crew needs to secure the well

prior to leaving the site. “Temporary abandonment” refers to the process by

which the rig crew installs cement plugs in the well and pulls the riser and

blowout preventer to the surface to move to another location. Pressure testing

(called positive and ne gative tests) is a key component of temporary

abandonment procedures because it seeks to ensure well integrity and that

hydrocarbons are not leaking into the well.

A. Installing the Lock

‐ Down Sleeve

BP’s planned temporary abandonment procedures for the Macondo well

were not completed until April 12, and subsequently changed a number of times

before Apri l 20. The initial plan included the setting of a lock

‐ down sleeve prior

to displacing drilling mud from the riser.

Temporary abandonment procedures do not always include installation of

a lock

‐ down sleeve. Correspondence from late 2009 and early 2010 shows that

BP decided to install th e lock

‐ down sleeve as part of its temporary abandonment

procedures on the Macondo well to save costs. In January 2010, Merrick Kelley,

BP subsea wells team leader, exchanged a number of emails with BP drilling

engineer Mark Hafle about the installation of a lock

‐ down sleeve by the

Deepwater Horizon cre w. Kelley calculated that this would save $2.2 million in

incremental costs: 199

199 BP

‐ HZN

‐ MBI

‐ 00097490.86 Hafle discussed this further with David Sims, and they agreed that the

Deepwater Horizon crew should move forward with the installation of the lock

‐

down sleeve as part of its temporary abandonment procedures. 200 BP chose to do

this even though the Deepwater Horizon was a rig that conducted exploratory

drilling operations

– operations that did not typically include the setting of a

lock

‐ down sleeve, which was typically done by a rig that specializes in

completion operations. Indeed, the Panel concluded that none of th e BP

personnel on the rig on April 20 had experience setting a lock

‐ down sleeve. 201

Common industry practice is, due to safety concerns, to set the lock

‐ down sleeve

in mud prior to displacement and setting of the cement plug. Although the crew

displaced the mud, the crew never got to the point of setting the lock

‐ down

sleeve

.

The Panel found no evidence that BP assessed the risks associated with its

decision to set the lock

‐ down sleeve. This decision increased the risk associated

with subsequent procedures, including the setting of the surface plug, the

displacement, and the negative test sequence. In all likelihood, had the lock

‐

down sleeve been set at a later time, the surface plug would not hav e been set as

deep; the surface plug would have been set sooner; and displacement would not

have resulted in a lower pressure differential in the well.

Notwithstanding the fact that the crew was unfamiliar with setting the

lock

‐ down sleeve and that this pr ocedure would increase operational risk, there

is evidence that members of the crew might have become complacent after

drilling was completed. BP contractor Ross Skidmore, when asked about his

concerns on the timing of setting the lock

‐ down sleeve, testified that “when you

get to tha t point, everybody goes to the mind set that we ʹ re through, this job is

done.” 202

B. Setting the Cement Plug

On April 16, BP submitted to MMS, and MMS approved, a revised

temporary abandonment plan stating that the lock

‐ down sleeve was to be set

200 BP

‐ HZN

‐ MBI100446. One reason to set the lock

‐ down sleeve during temporary abandonment

is to enhance safety by protecting the production casing against uplift forces that might occur

during production as a result of hydrocarbons flowing up the wellbore. The panel, however,

found no evidence that BP decided to set the lock

‐ do wn sleeve when it did out of safety concerns.

201 Testimony of Merrick Kelley, Joint Investigation Hearing, August 27, 2010, at 289

‐ 90.

202 Testimony of Ross Skidmore, Joint Investigation Hearing, July 20, 2010, at 263

‐ 64.87 after the displacement of the mud from the wellbore. The plan also increased the

depth of the cement plug to be set in the well as a barrier to flow. BP chose to

hang 3,000 feet of drill pipe below the lock

‐ down sleeve to weigh it down. 203

Having chosen to do this, BP believed that it needed to set the cement plug

deeper than normal to increase the amount of weight on the lock

‐ down sleeve.

The approved plan also called for two negative tests. The first negative test was

to be to the wellhead with a seawater gradient on th e kill line. The second

negative test was to be conducted after displacing with seawater down to 8,367

feet. Further, the approved plan called for the cement plug to be set in seawater

after displacement of mud from the wellbore.

BP’s temporary abandonment plan also called for the cement plug to be

set in seawater after displacement of mud to 3,300 feet below the mud line. This

created a risky situation

– after displacement of the mud, the well would be in an

underbalanced condition and at risk of a well control event. In addi tion, BP had

already eliminated the second ce ment barrier that would normally be set above

the top cement wiper plug. This further increased the well control risks.

C. The Use of Lost Circulation Material as Spacer

BP’s plans for displacement of the mud from the riser at the Macondo well

called for the use of spacer fluid, which is used to separate the drilling mud from

the seawater during displacement. The plans included the use of two differe nt

“pills” of spacer. The pills to be used were a blend of leftover lost circulation

material that had been mixed on the rig. The lost circulation material (material

provided by MI

‐ SWACO with the trade names Form

‐ A

‐ Set and Form

‐ A

‐ Squeeze) ha d been primarily used to prevent additional lost returns at the well.

BP had never used this type of spacer before, and it did not know whether the

spacer would be compatible with the synthet ic based mud that it was displacing.

BP also did not have any information about the long

‐ term stability of the

interface between the spacer and the seawater. 204 The Panel found no evidence

that BP had provided the rig crew with design specifications for the spacer.

The Panel reviewed evidence, including BP internal emails, that indicated

that BP chose to use the lost circulation materials as a spacer to avoid having to

dispose of the materials onshore. 205 If the materials were circulated through the

203 Testimony of Ronald Sepulvado, Joint Investigation Hearing, July 20, 2010, at 145.

204 Testimony of Steve Robinson, Joint Investigation Hearing, December 8, 2010, at 114.

205 BP

‐ HZN

‐ MBI00262887.88 well, the requirement to dispose of the materials onshore could be avoided

because the applicable regulations provide an exemption provided for water

‐

based drilling fluids and allow such fluids to be disposed overboard. 206

BP personnel and MI

‐ SWACO personnel agreed on the use of the lost

circulation material “pills” as spacer. 207 On April 20, the rig crew blended the

spacer from the lost circulation materials to a 16.0 ppg density. The rig crew

pumped 454 barrels of spacer into the well, more than twice as much material as

is typically used. The Panel found no evidence that BP considered the possibility

that pumpi ng a large amount of 16.0 ppg lost circulation material into the well

might risk clogging the choke line or the kill line. Nor did the Panel find

evidence that BP discussed this possibility with the rig crew. A clogged choke

line or kill line would lead to pressure differentials with the drill pipe and would

complicate any negati ve test procedures using either line.

In its post

‐ blowout investigation, BP concluded that the presence of this

spacer allowed for viscous material to be present across the choke and kill lines

during the negative test and that this possibly plugged the kill line. 208 This is a

possible explanation for the pressure differential between the drill pipe and kill

line.

D. Well Integrity Testing

1. Negative Pressure Test

– Planned Procedures

A negative pressure test is critical because it tests the integrity of the

bottom hole cement job, the wellhead assembly, the casing, and all of the seals in

the well. The negative test seeks to create conditio ns that simulate what will

occur after the well is temporarily abandoned. Heavy drilling mud is displaced

with spacer fluid and seawater. The displacement invites the well to flow as a

way of testing well integrity. 209 The wellbore fluids are replaced such that the

wellbore is underbalanced against the formation pressures for the purpose of

testing the barriers that are in place. There are a number of alternative ways a rig

206 See 42 U.S.C. 6921

‐ 6939f (the Resource Conservation and Recovery Act) and 40 CFR §

261.4(b)(5) (exemption for drilling fluids).

207 Lindner testimony at 296

‐ 298.

208 Robinson testimony at 96.

209 Review of Operation Data Preceding Explosion on Deepwater Horizon in MC 252, Dr. John

Smith, 7/1/10 (Smith Report).89 crew can conduct an accurate negative test. In the case of the Macondo well, the

barrier being tested was the cement in the shoe track of the wellbore.

BP considered multiple negative test procedures in the days leading up to

April 20. Neither BP nor Transocean had pre

‐ existing negative te st standards

and procedures. As of April 2010, MMS did not require that operators conduct

negative tests, and, consequently, did not specify how such tests should be

performed.

In an April 18, 2010 email entitled “Negative Test” from Brian Morel to

John Guide, Morel briefly explained the negative test to be conducted, stating

that the “[p]lan is to do a negativ e test with base oil on the bottom plug. Then

we will displace (a second negative test to greater value will happen) and

following that set the cement plug.” 210 Morel then asked Guide:

Are you ok with this, or do you think we should remove the first base oil

test and just use the displacement as a negative test (shut down at the end

and do a flow test)?... I have got different opinions from everyone on the

team. The way we currently hav e it set up is the standard we have been

using, but this one is slightly different because the plug is so deep and

base oil doesn’t achieve the full negative load the wellbore will see. Don

[Vidrine] and Bob [Kaluza] don’t seem to have strong opinions either

way. 211

Guide responded by saying, “I would use the seawater displacement as

the negative test, as you stated, shut down at the end and do a flow test.”

Twenty minutes later, Morel replied, without elaboration or any evidence of

deliberation, “[d]one.” 212 Neither Guide nor Morel informed the rig crew that

these changes greatly increased the risks of a well control event.

Transocean personnel were aware of the importance of conducting a

successful negative test. Jimmy Harrell, Transocean offshore installation

manager, testified that “[t]he first plan I seen [sic] didn’t have a negative test in

it. So I to ld him [Vidrine] it was my policy to do a negative test before displacing

with seawater.” 213

210 BP considered a number of different negative test procedures in the days leading up to April

20. The different negative test variations that BP considered are detailed in Appendix G.

211 BP

‐ HZN

‐ MBI

‐ 00256247.

212 Id.

213 Harrell testimony at 26.90 When asked how he would typically line up the piping and valve

arrangements for conducting a negative test, Harrell described another method

for performing a negative test. He explained that “[y]ou do it by leading

[bleeding] off back to Halliburton and up your drill pipe. You pump seawater to

the end of your tail pi pe and all the way back up to above your annular with

your spacer...You hold the mud in the riser with the annular closed...You have

seawater in the drill pipe and you have seawater in the kill line and either one

would be seeing the same pressure...” 214

Leo Lindner, an employee of MI

‐ SWACO, testified that on the morning of

April 20, 2010, he had two separate conversations regarding the negative

pressure test, one with Kaluza and one with Morel. Lindner stated:

He [Kaluza] wanted to go over the method by which the rig had been

doing it s negative test and displacing. I explained

– I explained it to him.

He seemed satisfied with it. Shortly after that, I was called by Mr. Brian

Morel. We had basically the same conversation. He seemed satisfied with

it. He informed me they were going to be displacing further down the

hole tha n usual. Usually it ʹ s 300 feet below the mud line, but this was

going to be at 8,367 feet [3,367 below the mud line]. I left the office and I

make my calculations. I type up a displacement procedure. 215

Lindner’s procedure specifically instructed, as step two, to “[d]isplace

choke, kill, and boost lines and close lower valves after each.” 216 The procedure

did not instruct the personnel to re

‐ open the choke and kill lines, which would be

necessary to perform a negative test on either line. In any event, Lindner

presciently noted at the end of the procedure that “[g]ood communication will be

necessary to accomplish a successful displacement. If you are not sure, stop and

ask.” 217

The only instruction given to the rig personnel in evaluating the negative

test was to monitor the well for no flow. No instructions were given to re

‐ open

the choke and kill lines, to monitor drill pipe pressure, or to evaluate and

investigate any pressure differentials. Testimony and interview notes from BP

214 Harrell testimony at 33.

215 Lindner testimony at 272.

216 BP

‐ HZN

‐ MBI00133083.

217 Id.91 personnel revealed that they had an oversimplified view of what constituted a

successful negative test

– they each believed that they only had to check for flow

to evaluate whether a negative test had been successful. Specifically, when asked

what a successful negative test was for the Macondo well, Guide said “[a]

succe ssful test needs to be run for 30 minutes with no flow from the well.” 218 In

response to the same question, Morel said “[n]o flow for 30 minutes,” 219 and

Donald Vidrine, a BP well site leader, responded that a successful negative test

required “[c]heck[ing] for flow or no

‐ flow.” 220

Guide and Morel appeared to have agreed upon a simplified approach to

the negative test that converted it from the previously

‐ approved multi

‐ step

process. When asked in a post

‐ blowout interview why BP made the change from

the April 16 approved procedure to the approach reflected in Morel’s April 20

Ops Note, Kaluza responded, “may be [Guide and Morel were] trying to save

time.” 221

Morel had previously articulated concerns about Kaluza’s ability to

execute procedures. Prior to arriving at the Deepwater Horizon

, Morel stated that

Kaluza was “not in tune with the well.” Morel said that he had to “go out [to the

Deepwater Horizon ] and make sure they [the crew under Kaluza] follow every

step.” 222 Morel traveled to the Deepwater Horizon and was on board on April 20.

However, notwithstanding his stated concerns about the cement job, about

Kaluza’s level of experience as the well site leader, and about the multiple

changes to procedures that increased the risks of a well control event, Morel

departed the Deepwater Hor izon prior to the performance of the critical negative

tests.

2. Positive Pressure Test Conducted on April 20

Another method of testing well integrity is a positive pressure test, which

is a test that is conducted by pumping additional fluid into the well after sealing

the blind shear rams. The rig crew then monitors the well to determine whether

the pressures in the well remain static. As described previously, the Deepwater

Horizon cre w performed a 2,500 psi positive pressure test between 10:30 a.m. and

218 BP

‐ HZN

‐ BLY00124455.

219 BP

‐ HZN

‐ MBI00021336.

220 BP

‐ HZN

‐ MBI00021424.

221 BP

‐ HZN

‐ MBI000021237.

222 BP

‐ HZN

‐ MBI00329028.92 noon on April 20. The pressures in the well remained constant during testing. 223

Dr. Smith, an expert retained by the JIT to review test data and other

information, found the positive pressure test to be acceptable. 224

3. Negative Tests Conducted on April 20

Without much time to consider changes in the temporary abandonment

procedures, on April 20 the Deepwater Horizon crew began work toward

conducting the critical negative test to evaluate well integrity. Before starting the

test, the crew displaced mud from the wellbore with seawater, whic h would

simulate well conditions after the well had been temporarily abandoned.

The first step of the negative test was to displace the riser boost line, the

choke line, and the kill line with seawater. 225 These efforts began at

approximately 4:00 p.m. on April 20. Over the next 30 minutes, the crew

pumped the 454 bbls of spacer (consisting, as discussed above, of mixed lost

circulation materials). Around 4:30 p.m., the crew then pumped approximately

352 barrels of seawater into the wellbore, which took approximately 25 minutes.

After pumping th e spacer and seawater, seawater should have been located

down the workstring and in the wellbore from 8,367 feet to 5,117 feet total depth

and the spacer should have been located just above the seawater

‐ from 5,117 feet

to 3,707 feet. 226

After the displacement, the rig crew should have seen a drill pipe pressure

of 1,610 psi, based on hydrostatic fluid calculations. However, the electronic data

indicates that the drill pipe pressure was 2,339 psi. This reading was more than

700 psi higher than it should have been. If the crew sa w this information, they

should have taken measure to resolve this anomaly because it may have

indicated that the spacer remained below the BOP stack (and could have clogged

the choke or kill lines). 227 This problem could have been resolved by continuing

the displacement (through the choke line) to ensure that all mud and spacer had

been removed from the wellbore below the BOP stack. This method of “cleaning

up the well” would not have compromised the function of the spacer because

most of the spacer was already in the riser above the BOP stack. 228

223 Smith Report at 7; Deepwater Horizon IADC Daily Drilling Report, April 20, 2010.

224 Smith Report at 8.

225 This first step was different from the first step in the MMS

‐ approved APM.

226 Id. at 9.

227 Id.

228 Id. at 18

‐ 19.93 There is no evidence that the rig crew detected or attempted to address

this anomaly. Instead, the crew proceeded to attempt to conduct the first

negative test. Well data and testimony establish that the rig crew closed the

annular around 5:00 p.m. and attempted to conduct a negative test by first

bleeding off the drill pipe pressur e from 2,324 psi to 1,427 psi.

The rig crew then opened the kill line valve, presumably to try to balance

the kill line and drill pipe pressure. As the kill line pressure fell to 0 psi, the drill

pipe pressure remained at 458 psi, thus ind icating that the crew may not have

fully displaced the spacer from below the BOP stack. At approximately 5:05

p.m., the crew shut in the drill pipe, and concurrently the drill pipe pressure

increased. The increase in drill pipe pressure is evidence of an unsuccessful

negative test and showed that the well was possibly flowing. In a ddition, the

fact that the choke pressure remained less than 0 psi shows that the negative test

was likely either unsuccessful or, at the very least, inconclusive. 229 At 5:25 p.m.

the negative test concluded.

Some time between 5:17 p.m. and 5:27 p.m., Jimmy Harrell (Transocean),

Robert Kaluza (BP), Donald Vidrine (BP) and other members of the drill crew

discussed the first negative test. According to Kaluza, this discussion about the

pressure on the drill pipe was “long.” 230 Kaluza stated that Jason Anderson,

Transocean assistant toolpusher, explained that the pressure was due to a

“bladder effect,” and that “this happens every time.” Brian Morel, a BP drilling

engineer who had previously raised concerns about Kaluza’s abilities to execute

procedures, was not on the rig at the time (he had depa rted hours earlier) to be

consulted on the drill pipe pressure and other anomalies. 231

In addition, no one involved in this “long” discussion about the negative

test consulted any of the executives visiting the rig at the time, even though these

BP officials had more than 50 years of drilling experience. At that time, the

executives, including David Sims and Pat O’Bryan, were onboard conducting a

rig tour and were presumably available for consultati on. 232 There is evidence

229 A reading of less than zero PSI suggests instrument error and/or an inaccurate test.

230 BP

‐ HZN

‐ MBI00021237.

231 Id

.

232 The group included Pat O’Bryan and David Sims from BP and Daun Winslow and Buddy

Trahan from Transocean. They planned to discuss a number of items with the rig crew,

including (in the eyes of BP and Transocean) the rig’s record of excellent communication and low94 that Sims and O’Bryan met with Kaluza at some point to discuss the positive

pressure test and how the crew would be lining up for the negative test. 233 But

the crew did not consult O’Bryan or Sims about the actual negative test results. 234

Around 5:30 p.m., after the first unsuccessful negative test, the rig crew

began to set up for another negative test, which began by bleeding off the drill

pipe and closing an internal valve in the drill pipe for 20 minutes. Once this

valve was closed, the crew was no longer capable of monitori ng the drill pipe

pressure.

Around 6:00 p.m., the crew bled the pressure from the drill pipe to the

cementing unit. At that time, the drill pipe was shut in at the cementing unit,

and the pressure on the drill pipe increased to 1,400 psi after 30 minutes. As the

pressure on the drill pipe increased, the kill line pressure also steadily increas ed

but only to 140 psi. This pressure differential between the drill pipe and the kill

line was another indicator that the negative test was not successful.

Around 6:45 p.m., the crew pumped a small amount of fluid into th e kill

line to make sure it was full for another negative test. At approximately 7:15

p.m., the crew opened the kill line to monitor for pressure/flow consistent with

the APM approved by MMS. After approximately 40 minutes of no flow or

pressure observed on the kill line, the crew and the BP well site leaders deemed

the negativ e test successful and began operations to complete the displacement

of drilling mud with seawater. Notwithstanding multiple anomalies that the

crew encountered during the several failed negative test attempts, the drill crew

and the BP well site leaders decided not to flush the system and conduct a new

negative te st.

Testimony from rig personnel involved with the negative test reflects that

they believed that they had successfully tested the integrity of the well by

checking for flow on the kill line. Kaluza stated that “[i]t was not

flowing...Absolutely no flow.” 235 Miles Ezell, Transocean senior toolpusher,

testified that Jason Anderson told him that “[i]t went good

. . . We bled it off. We

rate of “days away from work.” They also planned to discuss the rig’s financial performance

(costs compared to AFEs) and ongoing risk and hazard recognition. See BP

‐ HZN

‐ MBI129014.

233 Testimony of Patrick O’Bryan, Joint Investigation Hearing, August 26, 2010, at 360, 374; Sims

testimony, May 29 2010, at 178.

234 O’Bryan testimony at 443; Sims testimony, May 29, 2010, at 179.

235 BP

‐ HZN

‐ MBI00021264.95 watched it for 30 minutes and we had no flow.” 236 Chris Pleasant testified that,

“[d]uring the negative test we didn’t see any

– anything flow back.” 237

The crew apparently dismissed the phenomenon of the pressure

differential on the drill pipe and kill line as a “bladder effect” or annular

compression. Kaluza attempted to explain the bladder effect in an email sent on

April 25. 238

I believe there is a bladder effect on the mud below an annular preventer

as we discussed. As we know the pressure differential was approximately

1400

– 1500 psi across an 18 3⁄4” rubber annular preventer, 14.0 SOBM plus

16.0 ppg Spacer in the riser, seawater and SOBM below the annu lar

bladder. Due to a bladder effect, pressure can and will build below the

annular bladder due to the differential pressure but can not flow

‐‐‐ the

bladder prevents flow, but we see differential pressure on the other side of

the bladder.

On April 27, Mike Zanghi, BP vice president for drilling and completions,

forwarded Kaluza’s d escription of the so

‐ called bladder effect to O’Bryan, who

responded as follows: 239

236 Ezell testimony at 282.

237 Testimony of Chris Pleasant, Joint Investigation Hearing, May 28, 2010, at 118.

238 BP

‐ HZN

‐ MBI00262896.

239 Id

.96 Around 8:52 p.m. on April 20, about an hour after the second negative

test, Donald Vidrine (who was on the rig) called Mark Hafle (who was at BP’s

Houston offices) to talk about whether to test the surface plug using a pressure

test or a weight test. During the conversation, Vidri ne also talked to Hafle about

the negative tests that the rig crew had just conducted. Vidrine told Hafle that

the crew observed zero pressure on the kill line, but there was pressure on the

drill pipe. Hafle responded that a successful negative test could not result in

pressure on the drill pipe and zero pressur e on the kill line. He told Vidrine to

consider whether pressure was trapped in the line or perhaps a valve was not

properly lined up. Vidrine reported to Hafle that he was fully satisfied that the

rig crew had performed a successful negative test. 240

At the time of the conversation with Vidrine, Hafle was in his office,

where he could access real

‐ time data at any time through a system called Insite

Anywhere. Indeed, Hafle logged on to the Insite Anywhere database at 1:25:39

p.m. on April 20 and accessed Macondo well information via at 4:13:58 p.m. 241

The file he accessed was “Cementing XY Time Log”, and he remained logged

into the system (Insite Anywhere) until 5:27:35 p.m. 242 (Refer to Figure 9

– Insite

Anywhere Access Log for April 20, 2010). However, Hafle chose not to access

available real

‐ time data to help interpret the negative test results. Instead, Hafle

apparently accepted Vidrine’s explanation without reviewing data from the well

on the anomalous negative tests. The Panel found evidence that Hafle remained

at the office on April 20 until about 10:00 p.m. CST, whic h was just after the

discussion with Vidrine. After the blowout, he sent an email to himself detailing

his activities that day. 243

240 BP

‐ HZN

‐ BLY00125475.

241 Insite Anywhere is a database owned by Halliburton, accessible by BP personnel.

242 HAL 50546.

243 BP

‐ HZN

‐ MBI00327757.97 Figure 9

‐ Insite Anywhere Access Log for April 20, 201098 

### VIII. Kick Detection and Rig Response

A kick during drilling operations is the unwanted influx of formation

fluids, such as hydrocarbons, into the wellbore. An undetected kick can lead to a

loss of well control. As stated by Steve Robinson, BP vice president of wells in

Alaska, “[t]he key to well control is early detection. It ʹ s getting it shut in

quickly.” 244 Monitoring a well for kicks involves observation of a number of

indicators and a constant awareness of well conditions.

A. Kick Detection Methods and Responsibilities

Certain rig personnel, including the driller, assistant driller and

mudloggers have specific responsibilities for monitoring the well to detect kicks,

among other things. 245 BP’s well control manual provides that the well site

leader is responsible for developing, monitoring, and supervising well control

procedures. The company drilling engineer is responsible for providing

technical support to the wellsite leader. The senior contractor representative has

overall responsibility for actions taken on the rig. The contractor toolpusher has

overall responsibility for implementing th e well control operation and for

ensuring that the driller and the drill crew are correctly deployed during the well

control operation. 246

Personnel responsible for well monitoring use a number of methods to

determine whether the well is stable. One method is monitoring pit gain, which

involves tracking fluid gains in the pits that might indicate flow from the well.

Another method is the analysis of flow

‐ out versus flow

‐ in data

– which should

be equal if the well is stable. As discussed by Dr. John Smith in his report, these

two methods

– pit gai n and comparison of flow

‐ in to flow

‐ out

– are critical to

effective well monitoring. 247 In addition, other data (including drill pipe pressure

changes and gas content information) can also indicate if a well is flowing. A

warning from any of these indicators should prompt personnel to stop

circulating fluid and to perform a flow check. If flow continues, the well should

be shut in using the BO P. 248

244 Robinson testimony at 44.

245 Transocean Well Control Manual, TRN

‐ USCG_MMS00043810.

246 BP

‐ HZN

‐ MBI00000001.

247 Smith Report at 21.

248 Id. at 22; See API RP 59; IADC Deepwater Well Control Guidelines.99 Because of the importance of kick detection, the members of the rig crew

should be in constant communication with one another about possible kick

indications, or any other critical observations based on well

‐ monitoring. On the

Deepwater Horizon

, the well site leader was responsible for overseeing all well

operations, including well monit oring. The Transocean toolpusher and senior

toolpusher oversaw the drilling personnel and should be aware of rig operations

that might affect the crew’s ability to monitor for kicks. The Transocean offshore

installation manager (sometimes referred to as the “OIM”) had responsibility for

the entire Transocean crew. 249

Much of well monitoring is done through review of real

‐ time data that rig

personnel access on computer consoles. Sperry

‐ Sun sent mudloggers to the

Deepwater Horizon and also provided real

‐ time data that was accessible to the rig

crew. Rig personnel also had access to certain real

‐ time data from Transocean.

In addition, video cameras on the rig allowed the crew to monitor c ertain

activities, such as flow being returned to the pits. BP and its operating partners

had access to the real

‐ time data through Insite Anywhere, BP’s electronic data

system that provides real

‐ time flow

‐ in and flow

‐ out data, gas analysis data,

stand pipe pump pressures, and other data.

MMS regulations required operators to use the best available and safest

technolog y to monitor and evaluate well conditions and to minimize the

potential for a well to flow or kick. 250 The regulations also required the operator

to ensure that the toolpusher, operator’s representative, or a member of the

drilling crew maintains continuous surveillance on the rig floor from the

beginning of drilling operations until the well is completed or abandoned, unless

they have secured the well with a BOP, bridge plug, cement plug or a packer.

B. Multiple Simultaneous Operatio ns That Hampered the Crew’s

Ability to Detect Kicks

On April 20, after performing the negative pressure tests that were

incorrectly interpreted as successful, the rig crew turned to completing the

temporary abandonment procedures. The rig crew decided to perform multiple

operations over a short period of time, which likely limit ed their ability to

effectively monitor the well. At this time, Bob Kaluza and Donald Vidrine were

the BP well site leaders. Brian Morel was the BP drilling engineer, but he had

249 Transocean Well Control Manual, TRN

‐ USCG_MMS00043810.

250 30 CFR § 250.401.100 departed the Deepwater Horizon prior to the negative tests. Jimmy Harrell was

the offshore installation manager and was the senior Transocean representative

on duty at the time of the blowout. Miles Ezell, the senior toolpusher, was

attending a meeting with visiting executives and assigned Jason Anderson, an

assistant toolpusher, to oversee the temporary abandonment work. The Panel

found no evidence tha t Harrell, Ezell or Kaluza were on the rig floor during

temporary abandonment operations on the evening of April 20.

The rig crew complicated its well monitoring efforts by displacing mud to

two active pits (pits 9 and 10) instead of one. This decision left the rig crew

unable to accurately monitor wel l outflow because when fluid is moved

throughout the surface system (to other equipment tanks, filling/draining surface

lines, general semi

‐ submersible rig movement, etc.), subtle gains or losses in the

trip tanks or pits are more difficult to accurately monitor.

Cathleenia Willis, a Sperry

‐ Sun mudlogger, described the rig activ ity as

follows:

They [the rig crew] were getting prepared to displace and discussed the

program. At the safety meeting they said they would displace back to the

boat. AD [Assistant Driller] said they would call her because she said she

could not monitor displacement back to the boat. When Joe [Keith] came

on tower he said he needed to talk to them about displacing to the boat

and he was not hap py with this.

[Willis] told Joe Keith in handover what was happening and he was not

happy about displacement to the boat. 251

They [rig crew] were filling and dumping the trip tanks between 4:00 p.m.

and 6:00 p.m. At 628 strokes AD told her to zero out the strokes, this was

during the trip tank transfers. She got the strokes from the choke and kill

line and AD said it was okay to zero out the stroke counter. 252

Transocean’s policy, as stated in its Well Control Manual, Section 1.2.2.1,

requires “whenever possible, [to] limit circulation to a single active pit. Strictly

251 “Handover” in this context typically refers to the transfer of responsibilities from one person to

another.

252 BP

‐ HZN

‐ MBI00129630.101 enforce pit management, and carefully monitor for any discrepancies during

trips.” 253

Joseph Keith, a Sperry

‐ Sun mudlogger, testified that the rig crew was

“moving a lot of mud around from different pits, reserve pits, active pits, trip

tanks [and] sand traps. They were moving a lot of mud around.” 254 Keith

testified that he was concerned about this because he “couldn’t really monitor

the volumes in the pits correctly.” 255 Keith also testified that the activities

occurring onboard the Deepwater Horizon were not consistent with Transocean’s

kick prevention procedures. 256 Nevertheless, at no point prior to the blowout,

did Keith issue a stop

‐ work order because, according to his testimony, he “just

didn’t think of it at the time.” 257 Keith testified, however, that the high level of

mud

‐ moving activities should have resulted in a stop

‐ work order from someone

on the rig. 258

Dr. Smith analyzed available data and, in his report, detailed what Keith

and the rest of the crew would have observed had they properly monitored the

well. Just after 8:00 p.m., an increase of main pit volume by 500 barrels, likely the

result of the transfer of seawater into the main pit, precl uded the crew from

using pit gain as a monitoring tool. According to Dr. Smith, not having this tool

available complicated kick detection efforts and was not consistent with proper

pit management and monitoring. 259

Dr. Smith concluded that the crew could not properly monitor the well

and detect kicks from 8:38 p.m. to 8:56 p.m. on April 20. During this time, the

flow

‐ out was significantly less than the flow

‐ in, in a situation where lost returns

were unlikely. At the same time, the trip ta nk volume was increasing rapidly,

and the data showed that there was some volume increase in the main pits.

Given the complications created by conducting multiple operations

simultaneously, it is unlikely that the crew was able to evaluate these signals that

a kick was in progress. 260

253 TRN

‐ USCG

‐ MMS00043810.

254 Keith testimony at 39.

255 Id. at 98.

256 Id at. 39.

257 Id. at 81.

258 Id. at 82.

259 Smith Report at 22.

260 Id.102 At 8:58 p.m., flow

‐ out increased significantly and the pit level rose by

approximately 100 barrels in 15 minutes. According to Dr. Smith, at this point

the crew should have recognized this as a warning sign, stopped circulation and

performed a flow check. Dr. Smith stated that “[t]hese failures to respond to kick

warning signs are in direct violation of standard industry practice and MMS

requirements.” Dr. Smith concluded that th e well continued to flow after the

pumps were turned off at 9:09 p.m. This continued flow was “a conclusive

indicator that a kick [was] in progress, i.e., that formation fluids [were] flowi ng

into the well.” 261

Keith, a mudlogger with 18 years of experience who had responsibilities

for monitoring the well, testified that he went on a five

‐ to

‐ eight

‐ minute break to

the coffee shop and the smoking room area at approximately 9:00 p.m.

According to Keith’s testimony, after the crew shut down the pumps at 9:09 p.m.,

he looked at the video feed and did not see any flow. 262 Keith testified that, at

this time, he was not aware of increased pressure on the drill pipe, which was

another indicator that a kick was in progress. 263

At 9:10 p.m., having observed none of the several indications that a kick

was in progress, the crew rerouted returns from the well overboard, which

caused the returns to bypass the Sperry

‐ Sun flow

‐ out meter. This meant that

Sperry Sun mudloggers no longer had conventional kick detection methods at its

disposal. Dr. Smith observed that “[i]nitiating this action without insuring th at

the well was under control violates all industry practices and regulatory

requirements.” 264

Keith testified that he did not know the well was flowing until “it

sounded like it was raining outside” and he “started smelling gas coming though

[his] purge system.” 265

It is not clear what well control information, if any, the drill crew was

monitoring on the evening of April 20. At 9:18 p.m., the driller, Dewey Revette,

sent rig crew members to repair a pressure relief valve on one of the pumps.

This is significant because it is unlikely tha t Revette would have sent any crew

members to the pump room if he believed that the well was flowing. At

261 Id.

262 Keith testimony at 50, 118

‐ 120.

263 Id. at 184.

264 Smith Report at 23.

265 Keith testimony at 32.103 approximately 9:20 p.m., Jason Anderson, the toolpusher, told Miles Ezell, the

senior toolpusher, that the displacement was “going fine....I’ve got this.” 266 Ezell

testified that Anderson “had more experience as far as shutting in for kicks than

any individual on the Deepwater Horizon .” 267 The Panel found evidence that a

significant volume of hydrocarbons had already entered the wellbore, but the

Panel found no evidence that the Transocean rig crew had any awareness that

the well was flowing or experiencing a kick at this time.

C. Rig Floor Response

At approximately 9:30 p.m., Revette identifie d a pressure difference

between the drill pipe and the kill line and shut down the pumps to investigate.

The Sperry

‐ Sun data indicated that the drill pipe pressure initially decreased

when the pumps shut down. However, the drill pipe pressure then increased by

approximately 550 psi during the next five minutes while the ki ll line pressure

remained lower. One crew member testified that the driller and the toolpusher

had concerns about this pressure differential. 268

The rig crew then attempted to bleed off the drill pipe (i.e., open the well)

to eliminate the pressure differential, which briefly caused the drill pipe pressure

to decrease. 269 Given that the rig crew at this time decided to bleed off the drill

pipe pressure, they likely still did not understand that the well had begun to

flow. Bleeding off drill pipe pressure during a kick is not an industry

‐ accepted

practice.

At 9:38 p.m., the drill pipe pressure began to build back up. Dr. Smith

concluded that, at th is time, the rig crew routed flow to the trip tank to check

whether the well was flowing. 270 At approximately 9:42 p.m., the crew detected

flow and diverted the gas to the mud gas separator. At the same moment, or

shortly thereafter, the rig crew activated the upper annular preventer, after the

mud from the well was already flowing on the rig floor. The Sperry

‐ Sun data

indicates the annular preventer was activated at 9:43 p. m., and by 9:47 p.m., the

variable bore ram had been activated. By this time, the rig crew knew that a well

control event was occurring. The Transocean well control manual provides that

the crew should activate the BOP’s blind shear ram (“BSR”) as the last step in

266 Ezell testimony at 282.

267 Id. at 311.

268 Testimony of David Young, Joint Investigation Hearing, May 27, 2010, at 258

‐ 59.

269 Robinson testimony at 284

‐ 85.

270 Smith Report at 14.104 responding to a well control event, but the Panel found no evidence that the rig

crew did so at the time.

D. The Use of the Mud Gas Separator

A mud gas separator is used on a drilling rig to capture and separate gas

from the drilling fluid returned from the well. After sep aration, the mud flows

down into the pits and the gas is vented up in the derrick. A mud gas separator

is typically used to divert small volumes of hydrocarbons during a kick. If a

large flow is sent to the mud gas separator, there is a risk that th e vessel will fail

and create the possibility of gas ignition. If there is potential for a large flow, the

safer option is to divert the flow overboard using one of two diverter lines. The

diverter line is typically used during a well control operation when: (a) the gas

flow rate is too hig h for the mud gas separator; (b) hydrates are forming in the

gas vent line from the mud gas separator; (c) the gas is found to contain

hydrogen sulfide; or (d) the mud system is overloaded. 271

BP’s well control manual states that the mud gas separator should be lined

up at all times when a kick is being displaced, but there is a limit to the volume

of gas that each mud gas separator can safely handle. 272 Transocean’s well

control handbook indicates that if gas has migrated or has been circulated above

the BOP stack before the well is shut in, the choke manifold and mud gas

separator may no longer be available to control the flow rates when the gas in the

riser reaches the surface. 273 Both companies recommend using the diverter lines

when flow rates are too high for the mud gas separator.

Special precautions and procedures are necessary to avoid the effects of

the rapid expansion of gas in the riser, particularly in deepwater operations.

According to the Transocean well control manual, there is approximately four

times the mass of gas in a 15 barrel influx in 6,000 feet of water as there is in the

same influx in 1,500 feet of water. 274 Early recognition of the warning signals and

rapid shut

‐ in are the key to effective well control. 275 By taking well control

actions quickly, the crew can minimize the amount of formation fluid that enters

the wellbore. According to the Transocean well control manual, the rig crew can

271 Hydrogen sulfide is a chemical compound that is highly flammable.

272 BP

‐ HZN

‐ MBI00000060

‐ 61 (pages 1

‐ 4

‐ 4 and 1

‐ 4

‐ 5).

273 BP

‐ HZN

‐ MBI00131628

‐ 30 (pages 21 and 23).

274 Id. (Section 8, Subsection 4, page 22 of 28).

275 Id. (Section 3, Subsection 2, page 1 of 2). This is due to gas expanding as it moves towards the

surface and as compressive pressure decreases.105 calculate the estimated maximum gas and fluid flow rates and wellhead

temperature that could result from an uncontrolled flow from the zone of the

highest pressure through the open choke manifold. 276 The maximum kick

volume (kick tolerance) should also be calculated to ensure that gas liberation at

reasonable kill rates will not overload the mud gas separator. Prior to the

beginning of drilling operations, specific plans must be made and written

instructions given to all personnel concerning non

‐ standard actions/procedures

to be performed to prevent or react to any well control problems. 277

The Transocean well control manual provided that “the choke and kill

manifold low

‐ pressure valves must be lined up to direct the flow of the well

through the Mud Gas Separator (MGS).” 278 Witness testimony establishes that, at

approximately 9:41 p.m., mud from the well began flowing onto the rig floor and

the rig crew routed the flow coming from the riser through the diverter system

into the mud gas separator. 279 At roughly 9:45 p.m., Stephen Curtis, the assistant

driller, called Ezell, the senior toolpusher, to tell him that the well was blowing

out, that mud was going into the crown, and that the driller (Anderson) was

shutting the well in. 280

Micah Sandell, a crane operator, testified about what he saw:

After I saw the mud shooting up it was just several seconds and then it

just quit. It went down and, at that time, I yelled at my roustabouts to go

to the front of the rig. Now, whether they he ard my radio I ʹ m not sure,

but it was just several seconds after that

‐‐ I took a deep breath thinking

that ʹ Oh, they got it under control. ʹ Then all the sudden the degaser is

‐‐

mud started coming out of the degaser. And the degaser ʹ s on the

‐‐ and

I ʹ m sure ‐‐ I don ʹ t know if y ʹ all know it ʹ s on the starboard aft of the derrick

and it ʹ s in a goose neck and it points back down to the deck. And it come

out of it so strong and so loud that it just filled up the whole back deck

with a gassy smoke and it was lo ud enough that

‐‐ it ʹ s like taking an air

hose and sticking it to your ear. Then something exploded. I ʹ m not sure

what exploded, but just looking at it, it was where the degaser was sitting,

276 Id. (Section 8, Subsection 5, page 1 of 17).

277 Transocean Well Control Manual, TRN

‐ USCG_MMS00043810.

278 Id. (Section 4, Subsection 1 page 4 of 4).

279 Testimony of Micah Sandell, Joint Investigation Hearing, May 29, 2010, at 9

‐ 12; Young

testimony at 264.

280 Ezell testimony at 283.106 it ʹ s a big tank and it goes into a pipe. I ʹ m thinking that the tank

exploded. 281

Steven Bertone, the chief engineer on the Deepwater Horizon

, likened the

gas entering the rig to “a freight train coming through my bedroom.” 282 The 12

‐

inch mud gas separator outlet vent and the 6

‐ inch vacuum breaker vent were

goose

‐ necked and diverted flow back downward toward the rig, creating a grave

risk of explosion directly above the rig.

E. Activity on the Bridge

At approximately 9:48 p.m., a small “jolt” was felt on the bridge of the

Deepwater Horizon

, and simultaneously several of the gas alarms went off. 283

Transocean’s senior dynamic positioning officer, Yancy Keplinger, was on duty

at the time, and his responsibilities included monitoring the rig’s dynamic

positioning system to ensure the safety of the vessel. Also on duty was

Transocean’s dynamic positioning officer, Andrea Fleytas, who assisted

Keplinger. Two dynamic positioning officers were on duty at all ti mes

– one on

the desk where the system is, and one off the desk. At the time of the blowout,

Fleytas was on the desk. 284

Keplinger testified that he believed the initial gas alarms were coming

from the shale shaker house, an area of the rig where drilled solids are removed

from the mud. 285 Fleytas also testified that the gas alarm for the shale shaker

house went off first, followed by the alarm for the drill floor. 286 According to

Fleytas, the gas alarms illuminated in magenta, which reflects the highest level of

gas concentration. Subsequently, approximately 20 or more magenta gas alarms

illuminated, indicating the highest amount of combustible gas the sensors could

detect. 287

Keplinger testified that he went to the video monitor on the bridge

(camera 6), which was focused in the starboard aft direction and saw large

quantities of mud being ejected, but could not tell whether the mud was coming

281 Sandell testimony at 10

‐ 11.

282 Testimony of Stephen Bertone, Joint Investigation Hearing, July 19, 2010, at 34.

283 Testimony of Andrea Fleytas, Joint Investigation Hearing, October 5, 2010, at 13.

284 Testimony of Yancy Keplinger, Joint Investigation Hearing, October 5, 2010, at 128

‐ 129.

285 Id. at 151.

286 Fleytas testimony at 13.

287 Id. at 18, 54

‐ 55.107 from the diverter or another source. 288 Shortly afterwards, Fleytas received a call

from the drill floor, and someone on the rig crew informed her that they had a

“well control situation.” 289 Fleytas testified that she received a phone call from

someone in the engine control room, and she informed him that the rig was in a

well control situation. 290 After the initial explosion, the camera monitors showed

flames on the drill floor and a number of additional gas alarms went off. During

the call, Fleytas did not inform personnel in the engine control room of the gases

in their immediate vicinity. 291

At approximately 10:00 p.m., the general alarm and the fire alarm on the

Deepwater Horizon sounded. Keplinger made an announcement over the public

address system, instructing the crew to gather at emergency stations and stating,

“[t]his is not a drill.” 292 The general alarm on the Deepwater Horizon was

configured to be a manually

‐ operated system. Mike Williams, the chief

electronics technician on the Deepwater Horizon

, testified that Transocean had set

the gas detectors in “inhibited” mode and that this was standard practice. 293 In

the inhibited mode, the multiple magenta gas alarms were not set to

automatically trigger the general alarm and therefore, there was no alarm

configured to immediately warn personnel in the pump room of the urgent need

to go to emergency stations.

Fleytas activated the general alarm, but only after the explosion an d after

talking to the crew on the rig floor and the engine control room and responding

to the gas alarms. 294 Fleytas testified that she had never received training on how

to respond to multiple high gas concentration alarms going off in multiple areas

on the Deepwater Horizon

. 295

F. Emergency Disconnect System

The emergency disconnect system activates the blind shear rams on the

BOP stack and disconnects the riser, allowing the rig to move off of the well. The

emergency disconnect system is manually initiated but, once activated, performs

the various disconnect functions in an automatic sequence.

288 Keplinger testimony at 150.

289 Fleytas testimony at 13.

290 Id. at 13

‐ 14.

291 Id. at 40.

292 Keplinger testimony at 152. This is typically referred to as “mustering.”

293 Williams testimony at 30

‐ 34.

294 Fleytas testimony, at 13

‐ 14.108 Transocean’s Deepwater Horizon emergency response manual provides

guidance for when to activate the emergency disconnect system. The Transocean

well control manual outlines the different alert levels that reflect the dynamic

positioning status of the rig. The “green” level means that the dynamic

positioning systems is functioning in normal operations; the “yellow” level

means the station

‐ keeping ability (the ability to keep the MODU on positio n) is

deteriorating and that preparations to disconnect should begin; and the “red”

level signals that disconnection is necessary due to continuing deterioration of

station

‐ keeping abilities. Transocean’s manual states that there is redundant

communication in the driller’s console and on the bridge to ensure that the dr iller

and crew on the bridge can communicate in the case of any emergency. 296

Transocean’s well control emergency response manual requires drill

crews to discuss possible emergency disconnect actions. The manual does not

provide the rig’s master with defined emergency disconnect responsibilities. 297

The drilling crew, not the master, will typically be in the best position to evaluate

possible emergency disconnect actions in a drilling

‐ related emergency. An

expert retained by the JIT, Captain Carl Smith, testified that, as a master, he

would “rely on the experience of the people on the drill floor” to determine

when to initiate emergency disconnect actions. 298

The Panel found no evidence that there was any attempt to activate the

blind shear rams or the emergency disconnect system from the driller’s panel.

Chris Pleasant, the Transocean subsea engineer, attempted to initiate emergency

disconnect actions from the bridge and said, “everything in the panel did like it

was supposed to at the panel...I had no hydraulics.” 299 Pleasant said that the

panel went through its sequence after the explosions, but the rig was unable to

disconnect the riser and lower marine riser package from the BOP stack.

296 Transocean Well Control Manual, TRN

‐ USCG_MMS00043810.

297 Transocean Well Control Manual, TRN

‐ USCG_MMS00043810.

298 Testimony of Carl Smith, Joint Investigation Hearing, October 8, 2010, at 21.

299 Pleasant testimony at 123.109 

### IX. Conclusions on Temporary Abandonment, Kick Detection,

and the Emergency Response

A. Kick Detection and Response Failure Cause

At approximately 9:42 p.m., the crew detected flow and diverted the gas

influx from the well to the mud gas separator in accordance with the Transocean

well control manual. Shortly thereafter, the rig crew activated the upper annular

preventers and the upper variable bore ram, after mud ejected fro m the well was

already on the rig floor. The failure of the Deepwater Horizon crew (including

BP, Transocean, and Sperry

‐ Sun personnel) to detect the influx of

hydrocarbons until hydrocarbons were above the BOP stack was a cause of the

well control failure.

BP’s negative test procedures instructed personnel to mo nitor the well for

no flow and no pressure on the kill line. According to personnel monitoring the

well, the well was not flowing for 30 minutes and there was no pressure on the

kill line. But anomalies present during the negative tests, such as the presence of

drill pipe pressure wh en the kill line pressure was zero, should have prompted

the rig crew to investigate the results further. The Deepwater Horizon crew’s

(BP and Transocean) collective misinterpretation of the negative tests was a

cause of the well control failure.

B. Kick Detection Failure Contributing Causes

Pit volume (flow

‐ out) data is more accurate measure of flow than

calculating volume fro m pump output strokes and efficiency (flow

‐ in) and is the

preferred method for measuring flow. During critical cement testing, the crew

was using active pits number 9 and number 10 to transfer fluids to other pits

,

while at the same time transferring fluids from the rig to the Damon Bankston

.

Due to the activities onboard the Deepwater Horizon

, the mudloggers were

concentrating on the flow

‐ out and flow

‐ in meters. The Deepwater Horizon

crew’s inability to accurately monitor pit levels while conducting

simultaneous operations during the critical negative te st was a contributing

cause of the kick detection failure.110 C. Kick Detection Failure Possible Contributing Causes

On March 8, 2010, the Deepwater Horizon crew experienced a well control

event that went undetected for 30 minutes. Ten of the eleven individuals on

duty on March 8 during the undetected kick and well control event were also on

duty during the April 20 blowout. According to John Gui de, Transocean rig

management personnel admitted to him that those individuals involved with the

March 8 incident had “screwed up by not catching” the kick. Although BP has

internal requirements to conduct investigations into all drilling incidents, BP did

not do so for the Marc h 8 incident. BP’s failure to perform an incident

investigation into the March 8, 2010 well control event and delayed kick

detection was a possible contributing cause to the April 20, 2010 kick detection

failure.

The Panel found no evidence that, during cement pumping, BP shared

information with either the Deepwater Horizon rig personnel or Transocean shore

‐

based empl oyees about the increased risks associated with the Macondo

production casing cement operations, such as, the decision not to include a

second cement barrier above the wiper plug and the anomalies encountered

during cement pumping. BP’s failure to inform the parties operating on its

behalf of all known risks associa ted with the Macondo well production casing

cement job was a possible contributing cause of the kick detection failure.

BP decided to combine two lost circulation material pills, and use this

combined material as a spacer in the Macondo well. The presence of this spacer

allowed viscous mater ial to be across the choke and kill lines during the negative

test and possibly plugged the kill line. If the kill line was plugged, it could have

led to the pressure differential between the drill pipe and kill line. BP’s use of

the lost circulation material pills as a spacer in the Macondo well likely

affected th e crew’s ability to conduct an accurate negative test on the kill line

and was a possible contributing cause of the kick detection failure.

John Guide, the BP well team leader, believed that the Deepwater Horizon

crew had become “too comfortable” because of its good track record for drilling

difficult wells. Ross Skidmore, a BP contractor on the rig on April 20, testified

that the crew became complacent after completing drilling because “when you

get to that point, everybody goes to the mindset that we ʹ re through, this job is

done.” The complacency on the Deepwater Horizon could be attributable to the

crew not having access to all of the well data (OptiCem reports) available to BP

personnel onshore and the well site leaders on the rig. The overall complace ncy111 of the Deepwater Horizon crew was a possible contributing cause of the kick

detection failure.

BP drilling engineer, Mark Hafle, allowed the temporary abandonment

operations on the Deepwater Horizon to proceed even though he told Donald

Vidrine, the Deepwater Horizon well site leader, that “you can’t have pressure on

the drill pipe and zero pressure on the ki ll line in a [negative] test that is properly

lined up.” Furthermore, Hafle did nothing to investigate or resolve the pressure

differential issue even though he remained in BP’s office until 10:00 p.m. the

evening of April 20 and had access to real

‐ time well data (which he logged out of

at 5:27:35 p.m.). Haf le’s failure to investigate or resolve the negative test

anomalies noted by Vidrine was a possible contributing cause of the kick

detection failure.

Patrick O’Bryan, vice president of drilling and completions, and David

Sims, drilling and completions operations manager, were both onboard the

Deepwater Horizon during the negative test on April 20. Between the two

managers, they possessed approximately 50 years of drilling experi ence. Neither

Vidrine nor Robert Kaluza consulted with their managers about the negative

tests, their interpretation, or any other anomalies that occurred on the evening of

April 20. Further, Hafle warned Vidrine th at there might have been a problem

with the negative test. The failure of the well site leaders to communicate well

‐

related issues with the managers onboard the Deepwater Horizon was a

possible contributing cause of the kick detection failure.

The Panel identified five negative test procedures that BP developed

between April 12 and April 20. In addition, Leo Lindne r of MI

‐ SWACO

developed a negative test, and the rig crew performed a negative test through

the drill pipe. Also, on April 17, Guide sent an email to Sims stating that there

“had been so many last minute changes to th e operation that the WSL’s have

finally come to their wits end. The quote is ‘flying by the seat of our pants.’”

BP’s failure to provide complete and final negative test procedures to the rig in

a timely fashion was a possible contributing cause of the kick detection

failure.

A 15 bbls i nflux in 6,000 feet of water contains approximately four times

the mass of gas of the same influx in 1,500 feet of water. Early recognition of the

warning signals and rapid shut

‐ in are therefore crucial to well control in deep

water. Taking action quickly minimizes the amount of formation fluid that

enters the wellbore. The rig crew first observed the dr ill pipe pressure anomalies112 at about 5:52 p.m. and attempted to bleed

‐ off the drill pipe pressure. After three

unsuccessful attempts, the crew eventually justified the pressure as a “bladder

effect.” The rig crew did not realize the well was flowing until mud was

discharging onto the rig floor. The Deepwater Horizon crew’s hesitance to shut

‐

in the BOP immediately was a p ossible contributing cause of the kick

detection failure.

The MMS

‐ approved APM called for two negative tests. This would allow

for the greater opportunity to detect hydrocarbon influx in a staged test since the

first test would have been to the wellhead and the second test would have been

to the depth of 8,367 feet. BP’s f ailure to conduct the first of the two negative

tests was a possible contributing cause of the kick detection failure

.

When the Deepwater Horizon crew resumed pumping the returns

overboard at 9:15 p.m., the flow bypassed the Sperry

‐ Sun meter due to its

downstream location off the flow return trough. Consequently flow

‐ out data

could not be adequately monitore d by personnel, such as the Sperry

‐ Sun

mudloggers, who were responsible for monitoring these data. The rig crew’s

decision to bypass the Sperry

‐ Sun flow meter while pum ping the spacer

overboard was a possible contributing cause of the kick detection failure.

Well control training historically has not addressed situations, such as

conducting a negative test in that one is “inviting” a well control event to occur.

Additionally, displacement operations that put the well in an underbalanced

condition should be closely monitored throu ghout displacement operations. The

failure of BP’s and Transocean’s well control training and MMS requirements

to address situations, such as negative tests and displacement operations, was

a possible contributing cause of the well control failure.

D. Response Failure Contributing Causes

The rig crew’s decision to use the mud gas separator instead of the

diverter accelerated the likeliho od that the gas on the rig would ignite. The

decision to use the mud gas separator during the well control event was a

contributing cause of the response failure.

Once members of the drill crew identified the increase in drill pipe

pressure, the y checked the well for flow. At approximately 9:42 p.m., the crew

detected flow and diverted the gas to the mud gas separator. The rig crew was

not able to determine the magnitude of the flow when it made the decision to go113 to the mud gas separator. Transocean’s well control manual did not clearly state

to go to the diverter if the flow event is unknown. The ambiguity within the

Transocean well control manual on when to use the diverter and not the mud

gas separator was a contributing cause of the response failure.

At approximately 9:48 p.m., sever al of the gas alarms sounded. Within

minutes, approximately 20 gas alarms were sounding, the result of extremely

high levels of gas concentration. Yancy Keplinger, the senior dynamic

positioning officer, went to the video monitor and saw large amounts of mud

being ejected. Shortly afterwards, Andrea Fleytas, the dy namic positioning

officer, got a call from the rig floor, which informed her that there was a “well

control problem.” Fleytas told the Panel she received a phone call from the

engine room, but she never told the engine room personnel to perform an

emergency shutdown. The initial explosion occurred ap proximately 30 seconds

to a minute after the first gas alarm. At approximately 10:00 p.m., the general

alarm and fire alarm on the Deepwater Horizon sounded and the rig began to list

to one side. Only then did Keplinger make an announcement to muster and

prepare to evacuate. Personnel were not to ld to evacuate until approximately

twelve minutes after the first gas alarm went off. The failure of the personnel

on the Deepwater Horizon bridge monitoring the gas alarms to notify the

Deepwater Horizon crew in the engine control room about the alarms so that

they could take action s to shut down the engines was a contributing cause of

the response failure.

E. Response Failure Possible Contributing Causes

The crew was unaware of the volume of the hydrocarbon influx associated

with the blowout. The rig floor crew’s inability to determine the location of

the kick in relation to the BOP stack and the volume of hydrocarbons coming

to the rig in a matter of seconds was a poss ible contributing cause of the

response failure.

The Panel found no evidence that Jason Anderson, Transocean driller,

who was identified in the Transocean procedures as the individual who should

initiate th e emergency disconnect system, attempted to do so once the

hydrocarbons were past the stack. There is evidence that the rig crew activated

the upper annular and upper variable bore ram when the hydrocarbons were

past the stack. There is also evidence that Chris Pleasant, Transocean subsea

engineer, attempted to activate th e emergency disconnect system some time after

the explosions had disabled communications with the BOP stack. The rig crew’s114 failure to initiate the emergency disconnect system until after the

hydrocarbons were past the BOP stack was a possible contributing cause of the

response failure.

The Deepwater Horizon operated a manually

‐ functioned general alarm

system. If the general alarm of the Deepwater Horizon had been set to

automatically sound when “high

‐ high” ga s alarms sounded in multiple

compartments of the rig, personnel in the pump room likely could have moved

to a location where their chances of survival were greater. The “inhibited”

general alarm system was a possible contributing cause of the response failure.

Transocean’s senior dynamic positioning officer and dynamic positioni ng

officer were not trained for the events they faced on the bridge on the evening of

April 20, 2010. Transocean’s failure to train the marine crew to handle serious

blowout events was a possible contributing cause in the Deepwater Horizon

incident.115 

### X. Ignition Source(s) and Explosions

Two explosions occurred almost immediately after the blowout when the

large gas plume that had developed over the rig came in contact with one or

more ignition sources on the rig. The Panel considered the following possible

sources of ignition: (1) main engines and engine switch gear rooms; (2) mud gas

separator; (3) electrical equipment in hazardous areas; (4 ) friction and mechanical

sources; (5) non

‐ hazardous area sources; and (6) electrostatic discharge.

It is not possible to determine with certainty the source of ignition because

much of the physical evidence relevant to making such a determination was lost

with the rig or other wise is not available. Based upon its review of witnesses

testimony and other evidence, the Panel concluded that the main engines (and

switch gear rooms) and the mud gas separator were the most likely ignition

sources.

A. Main Engines and Engine Switch Gear Rooms

1. Configuration of Engine Rooms on the Rig

The Deepw ater Horizon had six engines located on the third deck of the rig.

Each engine was in an engine room that was equipped with air intake systems.

Each air intake system drew air from vents located in the engine room in which it

sat. Each engine room had an engine switch gear room attached to it.

The Deepw ater Horizon ’s engine rooms and switch gear rooms were

located in “unclassified” areas, which were areas that did not require explosion

‐ proof enclosures, intrinsically

‐ safe equipment, and/or purged and pressurized

equipment. The engines and switch gears in the non

‐ classified areas were not

designed or tested to ensure that they would not initia te an explosion.

The engines had multiple redundant safety systems and shutdown

devices designed to shut down the engines in an over

‐ speed situation. Engine

over

‐ speed is a condition where an engine’s revolutions per minute (“rpms”)

exceed their normal operating speed. This conditi on can occur when

combustible gas is drawn into the intake system. To prevent this, the air intake

systems included a shut

‐ off device (sometimes referred to as a “rig saver”) that116 sought to ensure that the engine would not over

‐ speed after ingesting

combustible gases. 300

The design of engine shutdown mechanisms on dynamically

‐ positioned

rigs, such as the Deepwater Horizon

, is different from the shutdown systems in

moored or jack

‐ up rigs. 301 Instead of the single top

‐ level shutdown of all engines,

a dynamically

‐ positioned rig is typically designed to allow the rig to activate an

emergency disconnect system to separate from the wellhead and allow the rig to

escape the hazardous area in the event of an uncontrolled blowout or other

emergency. This design also allo ws for continued use of the engines in an

emergency such as a fire. 302 Manual activation of the emergency disconnect

system, required on a dynamically

‐ positioned rig, can add complexity to a rig

crew’s response to a well control event and can also create a possible ignition

source during the presence of free gas on the rig.

2. Testing of the Over

‐ Speed Devices

A represen tative of Wartsila, the manufacturer of the Deepwater Horizon

engines, told the Panel that all automatic stop devices should be function tested

at least once every 1,000 hours of engine operation and that the over

‐ speed trip

devices be checked every 2,000 hours. 303 He also stated that the Deepwater

Horizon engines were not configured to run on natural gas and that if they

ingested natural gas they would mechanically fail (but not explode). 304

The Panel found no evidence establishing whether, and how often, the

engine over

‐ speed devices and individual engine components were tested by the

American Bureau of Shipping (“ABS”). ABS conducted yearly inspections of the

over

‐ speed devices during their continuous machinery surveys. These yearly

inspections included an evaluation of approximately 20% of the over

‐ speed

devices on the rig, with the goal of inspecting all devic es within a 5

‐ year period.

300 KMI_PI001156 RBS8D. The driller was responsible for shutting in the engine air intake on the

Deepwater Horizon

. The driller’s other responsibilities included: drilling the well and knowing the

drilling operations; monitoring real time data of the well; insuring the safety of rig floor

personnel working in a confined space; investigating well fl ow issues and responding to well

control events; communicating with the Subsea Engineer; and activating the EDS if necessary.

301 A moored rig is held in place by cables attached to giant anchors; a jackup rig is towed onto

location and is supported by mechanical legs lowered to the seafloor.

302 KMI_PI001156 RBS8D.

303 BOEMRE interview of Bob Miller (Wartsila) (November 16, 2010). An “overspeed trip device”

is a safety device that is designed to restrict the uncontrolled acceleration of the engine.

304 Id

.117 Unfortunately, ABS inspectors did not record which devices were tested each

year, which meant that there was no way to ensure that different over

‐ speed

devices were subject to inspection each year and that each device over time had

been inspected. 305

The Deepwater Horizon

, as discussed earlier in this Report, was a vessel

flagged under the Republic of the Marshall Islands. Foreign

‐ flagged vessels are

subject to USCG “Certificate of Compliance” inspections. These inspections do

not normally include testing of over

‐ speed devices unless there is some evidence

to indicate that the y might not function properly. One of the USCG inspectors

who conducted the inspection of the Deepwater Horizon stated that the engine

rooms and all machinery contained therein appeared to be well

‐ maintained. The

inspector did not deem it necessary to test the rig’s over

‐ speed devices because:

(1) as a foreign

‐ flagged vessel, inspection is not required; and (2) conducting an y

test of the over

‐ speed device could not be done without interrupting drilling

operations.

3. Evidence Relating to the Engine Rooms as a Potential Ignition

Source

Engines number 3 and number 6 were online at the time of the blowout.

The air inta kes for engine room 3 were located approximately 60 feet from the rig

floor in the center of the main deck.

Personnel on the Deepwater Horizon testified about what they saw and

heard on April 20 in the immediate vicinity of the engine rooms. Douglas

Brown, the chief mech anic on the Deepwater Horizon

, who was in the engine

control room at the time of the blowout, testified:

And right upon that the engines RPM started increasing. I heard

them revving up higher and higher and higher. Next I was

expecting the engine trips to take over, such as the overspeed,

and that did not ha ppen. After that the power went out and I

was assuming that was our high

‐ frequency trip and we were put

in dark, and right on the end of that was the first explosion.

* * *

305 Testimony of Arinjit Ray, Joint Investigation Hearing, May 26, 2010, at 297.118 I ʹ m going to say both of them revved up at the same time, and we

had engines 3 and 6 on line at the time. And in my opinion, I ʹ m

going to say that Engine 3 most likely blew up, simply because

the explosion came from the port side, which Engine 3 was pretty

much located right ne xt to the engine control room down one

level. And I really can ʹ t say which one revved up first, ʹ cause to

me it sounded like both of them did. 306

Mike Williams, the chief electronics technician, who was in the electronic

technician’s room at the time of the blowout, testified:

. . . I knew which engines were on line at any given time. I could

hear Engine Number 3 start to rev up, and its normal operating

RPM ʹ s to way above what I ever heard it run before, and its

continuously steadily rising, and I knew the n that we were ‐ we

were having a problem. As I started to push back from my desk,

the computer monitor exploded in front of me. All the lights in

my shop popped. The light bulbs themselv es physically popped.

Now I know we ʹ re in trouble. I reached down to grab my door,

and at the

‐ simultaneously of grabbing the handle, the engine

goes to a level that is higher than I can even describe it. It ʹ s

spinning so fast that it just

‐ It stopped spinning an d there ʹ s a

huge explosion. 307

Once Williams made it to the bridge, he explained to Captain Kuchta,

master of the Deepwater Horizon

, “[y]ou need to understand. We have no engine

control room]. It ʹ s gone. It has blown up. Engine Number 3 for sure has blown

up.” 308

Willie Stoner, a motorman, who was in the engine control room,

testified:

As it was roaring, the Number 3 engine you could hear the

Number 3 engine, which would be right here (indicating) started

revving up. And, as soon as it started revving up, it started a

load down change ove r. In other words, it ʹ s supposed to kick off

306 Testimony of Douglas Brown, Joint Investigation Hearing, May 26, 2010 at 93

‐ 94, 97.

307 Williams testimony at 13.

308 Id. at 18.119 the line...[a]nd, as soon as it did that, I could see ‐‐ well, Doug

[Brown] said ʺ Something ain ʹ t right. ʺ ...And, as he said that, about

that

‐‐ as soon as he stated that, he turned and came right over to

the console just to look at the screen. And, within seconds of that,

I saw roughly three, maybe five [emergenc y shut

‐ downs] on the

very bottom of the panel start flashing. I don ʹ t know if somebody

set them off or if

‐‐ That ʹ s emergency shut downs. It ʹ s supposed

to be actually for dampeners and to that effect if there ʹ s a fire or

something to that effect. Okay. They started flashing, within

seconds of that there was a big explosion, a loud ʺ Bang, ʺ it got

black. The port door on this here side (indicating) blew in. As

soon as it blew in within a matter of seconds the starboard side

blew in as soon as yo u heard the second explosion. 309

Paul Meinhart, a motorman, who was also in the engine control room,

testified:

The first explosion I was standing with my back to the port side

next to a door. The door on the port side of the engine control

room got blow in. So, I believe that it came from the po rt side of

the vessel from where we were at.

* * *

The second explosion at that time I had just moved over, but I still

had my back to the port side. But there ʹ s another door coming

from the center of the rig. During the second explosio n that door

got blown open. 310

The above witness testimony suggests that one or more of the explosions

occurred in the vicinity of engines 3 and 6.

B. Mud Gas Separator

As discussed previously in this Report, immediately following the

blowout the rig crew decided to send the hydrocarbon influx to the mud gas

309 Id. at 342.

310 Testimony of Paul Meinhart, Joint Investigation Hearing, May 29, 2010 at 32

‐ 33.120 separator, which could have caused the catastrophic failure of the device. 311 The

Panel found evidence that the configuration of the mud gas separator system

directed the venting gas back towards the rig floor. A 12

‐ inch device called a

mud gas separator outlet vent was located at the top of the derrick and was

configured so that the pipe ran back toward th e rig. This “gooseneck” piping

directed any venting gas and fluids back down to the rig floor. Another device

called a vacuum breaker was configured in a similar manner, but located at

approximately one

‐ third of the height of the derrick.

A number of individuals onboard the Deepwater Horizon at the ti me of the

blowout testified about what they saw in the vicinity of the mud gas separator.

Micah Sandell, a crane operator, who was in the port aft deck gantry

crane, testified that “all the sudden the degasser is

– mud started coming out of

the degasser” and “it [c ame] out of it so strong and so loud that it just filled up

the whole back deck with a gassy smoke and it was loud enough that

‐ it ʹ s like

taking an air hose and sticking it to your ear. Then something exploded.“ 312

Paul Erickson, a dynamic positioning officer, who was on the bridge of the

Damon Bankston

, testified:

Shortly after 9:30, I observed a cascade of liquid coming out of the rig, the

area of the drilling gear.

* * *

Shortly after the

– after 9:30, after the, I saw the liquid coming out th e

bottom of the rig, I heard what I thought at the time was a pressure tank

unloading. It ʹ s not uncommon to dump the air out of a pressure tank, but

it lasted maybe 20, 30 seconds, which was not an unusual occurrence, but I

mentally categorized it as an unlo ading, which was not an exception. In

fact, it escaped my mind because it seemed to be one of the fairly routine

things to happen.

311 As discussed in the previous section, the mud gas separator is a device used to separate gas

from drilling fluid. It is not designed to handle high volume flow. The panel calculated that the

possible instantaneous flow rate was approximately 129.6 million cubic feet per day

(“MMCFPD”) based on fact that the Spe rry

‐ Sun data showed a 150 bbl influx.

312 Sandell testimony at 10

‐ 11. A gantry crane is a large crane that is on a horizontal track and can

move across the main deck.121 * * *

Shortly after that, I saw an eruption of fluid out of the aft end of the

derrick on the main deck of the rig and the Captain had been on the radio

to the rig telling them we were being covered with mud and they had

responded that the y were having a well control problem and shortly after

that we were told that we ought get out of the way.

Somewhere in that interval, the eruption of liquid and the aft end of the

rig behind the

‐ aft of the derrick, 313 there was a flash of fire and I hollered,

ʺ Fire on the rig, fire on the rig, ʺ and headed for the general alarm and after

that it got pretty chaotic. 314

Alwin Landry, the captain of the Damon Bankston

, who was also on the

bridge of that vessel, testified:

And he [Erickson] advised me that there was mud or something coming

out from under the rig. I started to turn to look and I seen mud falling on

the back half of my bo at, kind of like a black rain. And I was a little

annoyed at first because I thought it might have been a ruptured hose

through a process up there. So when I seen the magnitude of the mud

coming down we instinctively closed the wheelhouse doors. I went to the

port side an d I looked out up at the derrick and that ʹ s when I seen the

mud coming out the top of the derrick. I came back to the center of the

ship, established contact with the Horizon and asked them what was

going on. ʺ I ʹ m getting mud on me

. ʺ I was advised that they was having

trouble with the well. Momentarily after that, another voice came over the

radio asking me to go to 500 meter standby. I advised them I still had a

transfer hose onboard. There was a pause and a response and the n

shortly after that, the first explosion at the rig occurred.

* * *

At that point, my focus was on top the derrick. At that point, it was my

concern for my crew, also, because I knew it was coming up aft deck and I

couldn ʹ t see right behi nd my cabin on the lower levels. So simultaneously

313 The location described is the same area where the air

‐ intakes for engine rooms 3 and 4 were

located.

314 Testimony of Paul Erickson, Joint Investigation Hearing, May 11, 2010, at 228

‐ 32.122 working radios and I talked to the bridge. I informed my guys to come

inside away from the deck area. So my focus was there and it wasn ʹ t

nowhere else on the rig until I felt and heard the explosion off the port

side there. 315

These witnesses testified that they saw mud flowing and possibly a “gassy

smoke” in the vicinity of the air intake for engine room 3 and the mud gas

separator prior to the explosions. This suggests that engine room 3 or the mud

gas separator was a possible ignition source.

C. Other Poss ible Ignition Sources

1. Electrical Equipment in Hazardous Areas

Hazardous area classification is based on the identification of areas or

zones according to the likelihood of the presence of sensitive flammable gas or

vapor concentrations. The most likely location for unguarded electrical

equipment to ignite flammable gas is the area on or nea r the drill floor.

Transocean classified the drill floor on the Deepwater Horizon as a Zone 2

hazardous area. Zone 2 denotes an area where explosive gas/air mixtures are not

likely to occur, but if they do occur, they are expected to be present for only a

short perio d of time.

Electrical equipment in designated hazardous areas must be subject to the

following safeguards: (1) explosion

‐ proof enclosures; (2) intrinsically

‐ safe

equipment (does not have sufficient energy to ignite flammable gases); and (3)

purged and pressurized equipment (contained within enclosures supplied with

fresh air from a safe lo cation at a pressure higher than the pressure of the

surrounding area).

The Panel found no evidence that electrical equipment in designated

hazardous areas was an ignition source. MMS inspectors conducted three

inspections while the Deepwater Horizon was on location at the Macondo well,

and they issued no Incidents of Non

‐ Compliance (“INCs”) following inspection

of rig floor electrical equipment. No witness testimony or other evidence

identified an y failure by Transocean to subject the electric equipment in

designated hazardous areas to the appropriate safeguards.

315 Testimony of Alwin Landry, Joint Investigation Hearing, May 11, 2010, at 99

‐ 100.123 2. Friction and Mechanical Sources

Mechanical sparks occur when there is excessive friction between metals

or extremely hard substances. As the two substances rub against each other,

small particles are torn from the surfaces. 316

At the time of the blowout, the rig floor crew was investigating the drill

pipe pressure differential, an activity not likely to cause friction. Chad Murray,

chief electrician on the Deepwater Horizon

, was in the electrical shop on the port

side of the third deck. Murray saw others working on th e number 2 mud pump

prior to the explosion. 317 The electrical shop is approximately 50 feet away from

the number 2 mud pump. None of the individuals working on the number 2

mud pump survived the explosion. The Panel believes that it was unlikely that

the members of the crew who were working on the number 2 mud pump

continued to work as the well blew out and gas rushed onto th e rig. If in fact, as

the Panel believes, these individuals stopped work immediately, there would

have been no mechanical friction ignition source in the area.

3. Other Non

‐ Hazardous Area Sources

If flammable gases dispersed beyond the hazardous areas on the ri g to

other deck levels with unclassified equipment, then other ignition sources were

possible. The Panel, however, found no evidence that the source of ignition was

located in any of the non

‐ hazardous areas of the rig.

4. Electrostatic Discharge

Electrostatic charge or static electricity occurs in many industrial

operations. Static discharges are responsible for many industrial fires and

explosions. Hydrocarbon gases are extremel y vulnerable to static discharge

ignitions that may often be undetectable by human sight or hearing. 318 The Panel

316 For a metal to spark, it must satisfy three conditions. First, the energy that causes particles to

be torn free must be sufficient to heat the metal to high temperatures. Softer metals usually

deform before they spark. Second, the metal must be able to oxidize and burn easily. Generally,

a metal’s spar king temperature is the same as its burning temperature. And third, the metal

must have a specific heat that allows it to spark. A metal with a low specific heat will reach a

higher temperature for the same amount of energy input.

http://www.firesandexplosions.c a/hazards/ignition_sources.php

.

317 Testimony of Chad Murray, Joint Investigation Hearing, May 27, 2010, at 336.

318 Static Electricity

– Guidance for Plant Engineers, Graham Hearn, 2002.124 could not rule out electrostatic discharge as a possible ignition source, but it

found no evidence directly supporting this theory.125 

### XI. Conclusions on Ignition Source and Explosion

The Panel concludes that there were two plausible ignition sources at the

time of the blowout: (1) engine rooms number 3 and/or number 6 (and associated

electrical switch gear rooms); or (2) the mud gas separator located near the rig

floor. The evidence that supports the Panel’s conclusion is discussed below.

A. Ignition Sources

The most probable ignition sour ce was engine room number 3 and/or

number 6. The conclusion is supported by: (1) witness testimony; (2) the location

of the air intakes into the engine rooms; (3) engine and electrical switch

‐ gear

rooms that were unclassified areas with numerous potential ignition sources that

could initia te an explosion; (4) as a dynamically

‐ positioned rig, the Deepwater

Horizon may not have been designed to immediately shut

‐ down when high

levels of gas are detected; (5) the Panel found no evidence that the over

‐ speed

devices properly functioned and found evidence that such devices may not ha ve

been inspected.

As mentioned previously in this Report, the hydrocarbon influx quickly

overwhelmed the mud gas separator. Witness testimony supports the fact that

there was a flash explosion near the air intake of engine room number 3 and the

mud gas separator shortly after the gas came onto th e rig. The catastrophic

failure of the mud gas separator created a possible ignition source with the gas

plume released onto the rig from the well.

B. Contributing Causes of the Explosion

The air intake for engine room number 3 is located in the center of the

deck just aft of the rig floor, while the air inta ke of the engine room number 6 is

outboard on the starboard side of the rig aft of the rig floor. The Panel concluded

that the delayed explosion between engines number 3 and number 6 was due to

the difference in the distance between the air intakes an d the gas flow. The

location of the air intakes for the engine room number 3 and number 6 was a

contributing cause of the Deepwater Horizon explosion.

The Panel found no evidence that the “rig saver” function of the over

‐ speed devices successfully shut down engines 3 and 6. The failure of the over

‐126 speed devices to initiate shut

‐ down of the engines was a contributing cause of

the Deepwater Horizon explosion.

The “gooseneck” configuration of the mud gas separator vent allowed for

the venting of hydrocarbons back onto the rig. This increased the risk of ignition.

The location and design of the mud gas separator outlet vents was a

contributing cause of the Deepwater Horiz on explosion.

Prior to the two explosions, approximately 20 gas alarms went off

indicating the highest level of gas concentration on the rig. Andrea Fleytas, the

dynamic positioning officer, testified that she received a phone call from the

engine room, but she never informed them to initia te the emergency shutdown

sequence or that there was a well control event. Fleytas’ failure to instruct the

Deepwater Horizon engine room crew to initiate the emergency shutdown

sequence after receiving 20 gas alarms indicating the highest level of gas

concentration was a contributing cause in the Deepwa ter Horizon explosion.

C. Possible Contributing Causes of the Explosion

Neither the engine room nor the switch

‐ gear room was a classified area.

Therefore, the equipment was not required to be explosion

‐ proof or intrinsically

safe. Nor is there a requirement that the area be purged or pressurized. The

classifica tion of engine rooms number 3 and number 6 as non

‐ classified areas

was a possible contributing cause of the Deepwater Horizon explosion.

The Deepwater Horizon had multiple inspections and surveys during the

ten

‐ year period it was operating in the Gulf of Mexico. The Panel found no

evidence that anyone identified th e location of the engine air intakes as a

potential safety issue. The failure to identify the risks associated with locating

the air intake of engine room number 3 in close proximity (approximately 60

feet) to the drill floor was a possible contributing cause of the Deepwater

Horizon explosion.

The gas se nsors in the engine compartment rooms of the Deepwater

Horizon did not automatically shut down the engines when there were high

levels of gas present on the rig. The absence of emergency shut

‐ down devices

that could be automatically triggered in response to high gas levels on the rig

was a poss ible contributing cause of the Deepwater Horizon explosion.127 The Deepwater Horizon had multiple inspections and surveys that should

have included the inspection of the engine overspeed shutdown devices. The

panel has been unable to ascertain exactly when each overspeed device was

tested. Accordingly, ABS indicated that it inspects 20% each year; however,

neither ABS nor Transocean document which devices are tested to ensure that

the same device is not tested each year and that all dev ices get tested within the

rotation frequency. The failure of ABS and Transocean to document which

devices are tested to ensure all devices are tested is a possible contributing

cause of the DWH explosion.

The emerg ency shut

‐ down response on a DP MODU utilizes a different

operating philosophy than employed on moored MODUs. Instead of the single

top level shutdown of all engines, the DP MODU rig is designed with an

emergency disconnect capability from the wellhead in order to escape the

hazardous area in the event of an uncontrolled blowout. Based on this mindset,

the engines should not be shutdown becaus e of the need for DP power. Even if

the process of manual activation is fully understood by those responsible for it

on a DP MODU, it adds additional complexity to response of the well control

event. Further, the philosophy creates a conflict since the rig needs to maintain

power to get off location while m aintaining that power creates a possible ignition

source during the presence of free gas on the rig. The DP MODU operating

philosophy when considering the performance of an Emergency Shutdown

(ESD) is a possible co ntributing cause in the Deepwater Horizon explosion.

D. Other Possible Ignition Sources

1. Electrical Equipment in Hazardous Areas

The most likely location for the ignition of flammable gas by unguarded

electrical equipment would be in the area on or near the drill floor. The

Deepwater Horizon drill floor required the use of properly maintained and

certified explosion

‐ pr oof, intrinsically

‐ safe, or purged and pressurized

equipment, which should have prevented the ignition of flammable gases by any

electrical equipment installed in this area. The Panel found no evidence that the

electrical equipment located on or near the drill floor’s hazardous area was a

cause of the ignition.128 2. Mechanical Sources

For mechanical sparks resulting from friction to have occurred, there must

be movement of equipment. At the time of the blowout no rig floor operations

were being conducted outside of the investigation into the drill pipe pressure

differential. The Panel found no evidence that the mechanical equipment on

the rig floo r was a cause of the ignition.

3. Other Non

‐ Hazardous Area Sources

If the flammable gas cloud dispersed beyond the hazardous areas on the

rig to other deck locations with unclassified equipment, then those ignition

sources could have sparked an explosion. Any unclassified equipment, such as

an electrical outlet, would not result in ignition unless a spark was available.

Additionally, the electrical equipment located on the w eather deck (top deck) is

typically sealed against the exposure of the offshore environment. The Panel

found no evidenced that non

‐ hazardous area sources were the cause of the

explosion.

4. El ectrostatic Discharge

Electrostatic charge or static electricity occurs in many industrial

operations. Static discharges are responsible for many industrial fires and

explosions caused by static electricity. Hydrocarbon gases are extremely

vulnerable to static discharge ignitions that may often be undetectable by human

sight or hearing. There Panel found no evi dence of electrostatic discharge, but

it cannot be ruled out as a possible source of ignition in the explosion.129 

### XII. The Deepwater Horizon BOP Stack

A BOP stack is a series of rams and annulars situated at the top of a well

that the rig crew can close if it loses control of formation fluids. BOPs come in a

variety of configurations, sizes and pressure ratings. Some BOP components are

designed to seal an open wellbore, some are designed to seal around tubular

components in the well, some are fitted with hardened steel shearing surfaces to

cut through drill pipe or casing, and others are designed to cut thr ough drill pipe

and seal the wellbore.

A. Design and Configuration

Cameron manufactured the BOP stack used during d rilling operations by

the Deepwater Horizon

. Cameron originally sold the BOP to R&B Falcon, which,

as discussed previously, was acquired by Transocean. 319 Cameron delivered the

final assembled BOP stack, which weighed approximately 650,000 pounds, to

R&B Falcon in April 2000. 320

R&B Falcon provided Cameron with specifications for required functions

and the preferred configuration of the desired BOP stack. 321 David McWhorter,

Cameron vice president of engineering and quality, testified that Cameron

assembled the stack according to R&B Falcon’s design specifications and in

compliance with API specifications. 322 McWhorter indicated that Cameron

designed and tested its equipment in accordance with API Specification 16A.

Cameron does not subject its BOPs to dynamic flow testing, nor is such testing

required in API Specification 16A. 323

The Deepwater Horizon BOP assembly consisted of two major sections: the

stack and the lower marine riser package ( see Figure 10). At the time of the

blowout, the major components of the Deepwater Horizon main stack consisted of

the following:

 Wellhead connector, which connected the BOP stack to the Macondo

319 In 1999, when it manufactured the BOP, “Cameron” was the Cameron Division of the Cooper

Cameron Corporation.

320 CAMCG 00002843; TRN

‐ USCG

‐ MMS

‐ 00014355.

321 Cameron Communication to JIT.

322 Testimony of David McWhorter, Joint Investigation Hearing, April 8, 2011, at 112, 117.

323 McWhorter testimony at 153. Dynamic flow testing is testing of the BOP stack under

conditions that simulate pressures that might be generated by a blowout.130 wellhead.

 Two variable bore rams (“VBRs”) designed to seal around several

different sizes of drill pipe but do not shear or otherwise affect the drill

pipe.

 Test ram (converted VBR), which is an inverted VBR that is designed

to only hold pressure from the top down. 324

 Casing shear designed to cut through drill string or casing. It

consisted of a cutting element only, and was not designed to seal.

 Blind shear ram (sometimes referred to as “BSR”) consisting of both a

cutting and sealing element and designed to cut the drill pipe and seal

the well.

 Choke and kill lines, which are hi gh

‐ pressure pipes that led from an

outlet on the BOP stack to the rig pumps. 325 Typically, the choke does

not connect to the rig pumps, however, the Deepwater Horizon BOP

could use the choke and kill lines interchangeably.

 Remotely operated vehicle (“ROV”) panels

– operating panels that

allow an ROV lowered to the sea floor to activate certain function on

the BOP stack. 326

 Accumulator bottles, which provided hydraulic fluid used to operate

the various BOP elements.

At the time of the blowout, the major components of the lower marine

riser package consisted of the following:

 Two annulars (upper and lower), which are rubber

‐ metal composite

elements capable of closing around the drill pipe to seal the annul us.

 Blue and yellow pods, two redundant control pods used to operate the

BOP components.

 Multiplex connector, the point at which the multiplex lines connect to

the BOP stack.

 ROV hot stab panels, which are operating panels that allow an ROV

lowered to the sea floor to activate certain function on th e BOP stack.

 Accumulator bottles, which provided hydraulic fluid used to operate

the various BOP elements.

324 BP

‐ HZN

‐ MBI

‐ 000136647; BP Deepwater Horizon Accident Investigation Report, 172.

325 During well control operations, rig crews pump kill fluid through the drill string and annular

fluid is removed from the well using the choke line.

326 To “hot stab” is to insert an ROV’s robotic arm into a hydraulic port on the BOP stack to pump

hydraulic fluid into the BOP ram closing system.131 Figure 10

– Schematic of the Deepwater Horizon BOP Stack

The table below identifies the installation dates of the following

Deepwater Horizon stack components: 327

327 TRN

‐ USCG_MMS

‐ 00097144. Port Side Choke Valves

Middle Variable

Bore Ram

Kill Valve Blind Shear Ram

Lower Variable

Bore Ram Upper Variable

Bore Ram Casing Shear Ram Kill Valve Lower Annular

Preventer Upper Annular

PreventerKill SideChoke Side FlexJoint®

Port Side Choke Valves

Middle Variable

Bore Ram

Kill Valve Blind Shear Ram

Lower Variable

Bore Ram Upper Variable

Bore Ram Casing Shear Ram Kill Valve Lower Annular

Preventer Upper Annular

PreventerKill SideChoke Side FlexJoint®

Port Side Choke Valves

Middle Variable

Bore Ram

Kill Valve Blind Shear Ram

Lower Variable

Bore Ram Upper Variable

Bore Ram Casing Shear Ram Kill Valve Lower Annular

Preventer Upper Annular

PreventerKill SideChoke Side FlexJoint®132 Component Date Installed

Lower Pipe Ram August 2000 328

Middle Pipe Rams August 2000

Upper Pipe Rams August 2000

Shearing / Blind Rams April 2007

Casing Shear Rams September 2009

Lower Annular Overhauled

– October 2007

Upper Annular Overhauled

– October 2007

Upper Kill Failsafe Valve October 2007

Lower Kill Failsafe Valve December 2006

Upper Choke Failsafe

Valve June 2005

Lower Choke Failsafe

Valve January 2006

Bleed Kill Failsafe August 2009

Mud Boost Valve June 2004

LMRP Connector January 2005

Wellhead Connector

Cameron Overhauled

– October 2009

Figure 11

– BOP Component Installment Dates

B. Control and Power Systems

The Deepwater Horizon had a multiplex control system that used both

subsea and surface equipment to operate the BOP stack. The control system was

designed to operate and monitor the closing mechanisms in the BOP stack. The

system us ed both hydraulic and electrical power to control different elements.

The hydraulic power unit located on the Deepwater Horizon provided the

hydraulic power fluid that could operate the different functions on the BOP stack

and the LMRP. Accumulator bottles both on the surface and subsea provided

hydraulic power to the system. The hydra ulic power unit and the accumulators

had sufficient fluid capacities to be able to operate the various BOP stack

functions. 329

328 As previously noted, this was subsequently converted to a test ram.

329 CAMCG

‐ 00000236. These volumes were consistent with API specifications.133 The microprocessor

‐ based control system on the Deepwater Horiz on BOP

stack received AC power from an uninterruptable power supply unit, which was

designed to keep surface and subsea equipment operational under all conditions.

All primary functions of the BOP stack were controlled through the multiplex

cables, which connected the rig to the BOP st ack. As a result, the loss of the

multiplex cables would result in loss of power and loss of control of these

functions. To ensure operational redundancy and AC power supply, the

uninterruptable power supply unit included a battery system able to provide

power to the panels, diverter controls, event logger an d pods for at least two

hours of normal operation. 330

Cameron offers an option for a rig to have the ability to monitor each

pod’s battery voltages from any control panel. The Deepwater Horizon did not

have this additional Cameron technology, which would have enabled the rig

crew to monitor battery voltages.

C. Emergency Disconnect System

The emergency disconnect system is a syste m that can allow the rig to

separate from the BOP. This system can be activated from three different

locations: (1) the driller ʹ s control panel; (2) the bridge; or (3) the subsea engineer

control room. The BOP had two emergency disconnect systems sequencing

options, referred to as “EDS 1” and “EDS 2.” Both emergency disconnect system

options were designed to close the BSRs, close the choke and kill valves, and

unlatch the LMRP Connector, along with ch oke and kill connectors. EDS 2,

however, would also activate the casing shear ram. 331 The step

‐ by

‐ step

sequences for the Deepwater Horizon ’s emergency disconnect system are in

Appendix H.

The hydraulic power to perform the emergency disconnect system

sequence came primarily from the conduit. 332 Upon activation, however, two

functions

– the high pressure closing of the BSR and of the casing shear ram

–

would receive their hydraulic power from the BOP stack mounted accumulators.

330 Id.

331 BP

‐ HZN

‐ MBI00010443.

332 Id. The conduit in turn received its supply from the hydraulic power unit from the surface.

This unit had at least two triplex pumps to supply the pressure to the accumulator bank through

the conduit.134 The multiplex umbilical cables provided the electrical power and

communication to the pods. The electrical power originated from power and

communication cabinets located on the surface. The cabinet has a dedicated

uninterruptable power supply that provided electrical power to subsea systems

for a minimum of two hours if main power from the rig was inte rrupted or

removed. There were control panels on the rig that would allow the rig crew to

send emergency disconnect commands to the subsea equipment. The commands

were transferred to the BOP stack through control pods that were connected to

the rig by multiplex umbilical cables. 333

D. Automatic Mode Function (“Deadman”)

The automatic mode function (“AMF”) or “deadman” system is designed

to close the BSR in the event that the LMRP suffers the loss of electrical power,

the loss of fiber

‐ optic communication with the rig, and the loss of hydraulic

pressure from the rig. The accumulator bottl es located on the lower BOP stack

provided the hydraulic power for the AMF. 334 The step

‐ by

‐ step AMF sequence

for the Deepwater Horizon is in Appendix H.

The AMF relied upon two redundant control pods

– a blue pod and a

yellow pod. Under normal operations, the pods were powered through AC

cables from the surface. In the event of a loss of power fr om the surface, the

power supply for each of the control pods was maintained through batteries

located in the subsea electronics module (“SEM”) in the multiplex section of each

pod. The pods were located on opposite sides of the LMRP. Each functioned

independently and each had its own power supply and batteries. Each pod

included solenoid valves, which were devices that ope ned and closed in

response to electrical signals. The solenoids were designed to communicate with

the BOP elements and trigger the delivery of 4,000 psi closing pressure to the

BSRs through the dedicated accumulator bottles located on the lower BOP stack.

E. Autoshear Function

The autoshear function is designed to close the BSR in the event of an

unplanned disconnect of the LMRP from the lower BOP stack. A poppet valve

333 Id.

334 Id. The AMF is usually designed for events such as the riser parting. If the riser parts at the

lower flex joint or some other part of the riser system, the AMF sequence is designed to activate

to seal the well.135 was located between the LMRP and the lower BOP that would fire in the event

the LMRP was raised accidentally. This enabled 4,000 psi closing pressure to be

applied to the BSR through the dedicated accumulator bottles located on the

lower BOP stack. This would seal the wellbore in spite of the loss of conduit

supply pressure fro m the surface.

F. Forensic Examination of the BOP

1. Retrieval and Transport of the BOP to Michoud

After the uncontrolled flow of hydrocarbons from the Macondo well was

stopped, a team directed by the Unified Area Command and the JIT worked to

retrieve the Deepwater Horizon BOP stack from the sea fl oor, using the Q4000

vessel. The team successfully retrieved the BOP stack on September 4, 2010.

The JIT took a number of steps immediately following the BOP’s retrieval

designed to preserve the condition of the BOP stack. The goal of these

preservation measures was to displace seawater and BO P stack fluids within the

BOP control system, the hydraulic operating system, and the stack cavities to

minimize corrosion of the BOP stack upon exposure to the atmosphere. To do

this, it was necessary to function a number of the BOP stack components;

however, three sections of drill pipe were discovered inside the BOP stack. The

sections of the drill pipe were removed and preserved for further analysis. The

JIT modifie d the preservation procedures to prevent disturbance of the

additional drill pipe found inside the BOP stack, and immediately took steps for

wellbore preservation steps in preparation for transport to shore.

After the preservation steps were completed, a barge transferred the BOP

stack to the National Aeronautics and Space Administration (“NASA”) Michoud

Asse mbly Facility in New Orleans. The Michoud facility is a secure federal site

where the examination could be conducted. Site preparation activities includ ed

constructing a test pad capable of supporting the approximately 325

‐ ton BOP

stack, deployment of environmental containment equipment, and construction of

a temporary structure to house the BOP stack.

2. Scope of the Forensic Examination

The JIT retained Det Norske Veritas (“DNV”) to prepare a forensic testing

plan, to conduct the forensic examination, an d prepare a report containing

detailed findings based on the forensic examination of the BOP stack. The136 objectives of the forensic examination were to determine how the BOP stack

performed during the blowout, identify any failures that may have occurred,

determine the sequence of events leading to any potential failures of the BOP

stack, and evaluate the effects, if any, of a series of modifications to the BOP s tack

that BP and Transocean officials had implemented before the blowout.

The examination was designed to evaluate: (1) whether leaks on the BOP

stack were factors in the BOP stack’s performance during the blowout and

during the ROV intervention efforts; (2) whether any modifications made to the

control logic and stack adversely affected the BOP stack’s performance; and (3)

whether any other rele vant factor, including manufacturing defects, deferral of

necessary repairs affecting functionality, and maintenance history affected the

BOP’s ability to operate as intended.

The forensic examination sought to recreate the pre

‐ blowout conditions of

the BOP stack. Two methods were used to achieve thi s: (1) working backwards

from the current condition of the BOP stack through all of the interventions; and

(2) comparing the as

‐ received condition of the BOP stack with drawings and

records reflecting the state of the BOP stack prior to April 20, 2010.

DNV’s investigative process was an iterative process that integrate d the

BOP stack function testing, the collection of evidence, preservation of evidence

(especially the drill pipe contained in the wellbores of the BOP and LMRP),

examination of materials, damage assessment and video and photo

documentation.

3. The Forensic Examination Technical Working Group

During intervention operations, th e companies familiar with the Deepwater

Horizon BOP stack identified many modifications made to the stack since its

original delivery by Cameron. As a result, technical consultation with

Transocean and Cameron was critical for both the effectiveness of examination

and for the safety of the examiners. Recognizing this, a technical w orking group

(“TWG”) was established to provide DNV with technical support and expertise

as DNV conducted its forensic examination. The TWG included one expert and

one alternative each from Cameron, Transocean and BP; an expert working for

the United States Department of Justice; two experts representing the plaintiffs in137 the multi

‐ district litigation; and an expert nominated by the Chemical Safety

Board. 335

The members of the TWG provided DNV with input and suggestions for

testing protocols and other technical support. DNV held daily morning meetings

with the TWG to discuss each day’s planned forensic testing activities. Through

participation in morning meetings and observation of DNV’s work, TWG

members were able to monitor al l day

‐ to

‐ day forensic testing activities.

G. Examination Methods Used by DNV

1. Forensic Testing Plan

At the request of the JIT, DNV developed and submitted for JIT approval

a forensic testing plan. The plan included forensic testing procedures for the

BOP stack and its components in accordance with established and accepted

protocols, methods, and techniq ues. 336 DNV’s forensic testing plan was also

submitted to the TWG and the parties in interest (“PIIs”) for review and

comment. Where appropriate, DNV revised its test plans to address comments

received. The JIT approved DNV’s revised forensic testing plan on October 27,

2010. 337

2. BOP Stack Testing

After the BOP stack arrived at the Michoud testing site, DNV visually

inspected the stack and recorded all visible numbers including serial numbers.

DNV examined internal components using a camera and video borescope. DNV

then completed the following tasks: (1) determination of the final position of the

annular preventers and rams; (2) examination of the co ndition of the BOP and

the LMRP; (3) removal of the drill pipe from the BOP and the LMRP; (4) removal

335 The U.S. Chemical Safety Board (“CSB”) is an independent federal agency charged with

investigating industrial chemical accidents.

336 The protocols included professional video recording of the entire examination and complete

photographic documentation.

337 The protocols in DNV’s forensic testing plan were not meant to be a step

‐ by

‐ step set of

procedures. As with many forensic examinations, the test plan provided a roadmap for meeting

the objectives, but needed to be adapted as the testing progressed. DNV submitted additional

protocols that were outside of the scope out lined in the original testing plan to TWG for review

and comment and to the JIT for approval.138 of the ram blocks; and (5) function testing of critical functions and circuits that

were involved in the attempts to control the well during the first two days

following the blowout. 338

3. Materials Evaluation and Damage Assessment

Another critical part of DNV’s forensic work was materials evaluation and

damage assessment. Materials evaluation included: (1) cleaning and examining

the BOP rams; (2) cleaning and examining drill pipe segments removed from the

BOP stack and the riser; (3) cleaning and examining components extracted

during the removal of the rams; and (4) collecting and c leaning all solid objects

found within the different ram cavities.

DNV assessed the damage to the BOP stack in three different ways: (1)

visual inspection and photo documentation; (2) dimensional measurements; and

(3) three

‐ dimensional laser scanning. In addition, DNV used struct ural analysis

and modeling to simulate drill pipe behavior in the wellbore. 339

4. ROV Intervention Operations Review

DNV reviewed video footage and still photographs taken from a number

of different ROVs that were used during attempts to stop the well flow. This

review allowed DNV to assess the condition of the BOP stack when it was still

submerged and to try to determine the origin of leaks in the BOP’ s hydraulic

circuitry. This review also allowed DNV to assess the impact of various ROV

interventions on the condition of the BOP stack. 340

H. DNV’s Forensic Examination Findings

DNV’s forensic examination found that, as the BSR was closed, the drill

pipe was positioned such that the outside corner of the upper BSR blade

contacted the drill pipe slightly off center of the drill pipe cross section. A

portion of the pipe cross section was outside of the intended BSR shearing

surfaces and would not have she ared as intended. As the BSR closed, a portion

of the drill pipe cross section became trapped between the ram block faces,

preventing the blocks from fully closing and sealing.

338 DNV Report, Vol. 1, at 23

‐ 24.

339 Id. at 23.

340 Id. at 24.139 DNV’s forensic examination found that the main failure of the Deepwater

Horizon BOP stack was caused by a portion of the drill pipe being trapped

outside of the blind shear ram cutting surfaces, which prevented the blind shear

rams from fully closing and sealing. DNV was able to reconstruct the segments

of recovered pipe through analys is of the segments of pipe and tool joints that

were located throughout the BOP and riser, including analysis of wear patterns,

drill pipe dimensions, damage and deformation markings, sheared ends of

recovered drill pipe, and physical differences between the two recovered joints of

drill pipe. DNV also determined that a t ool joint had been located in the upper

annular while flow was present. DNV also noted the as

‐ received condition of

many BOP stack components, i.e., blue and yellow pod battery voltages and

various ram positions. DNV’s report is included at Appendix D.

1. Sequence of Events Related to the Blind Shear Rams

There are two possible scenarios for how the blind shear rams were

activated and closed: (1) the autoshear circui t was activated on April 22, by

cutting the poppet valve between the LMRP and lower BOP stack; or (2) the

automatic mode function had been activated by loss of the multiplex and

hydraulic lines on April 20. In it s reports prepared for BOEMRE, DNV presented

findings with respect to both of these scenarios. However, DNV concluded that

the most likely scenario for the activation of the blind shear ram was from the

autoshear circuit. 341

By the time the BSR was activated and closed, the drill pipe was

positioned outside of the BSR blade surfaces. As the BSR closed, this portion of

the drill pipe became trapped between the ram block faces and prevented them

from fully closing and sealing. This resulted in a 2.8 inch gap between the

blocks, as estimated by a DNV model.

DNV concluded that, at the time of the blowout, there was a drill pipe tool

joint locate d between the closed upper annular and the closed upper VBR, which

the Panel concluded were properly spaced out. The Panel believes that the rig

crew manually closed the upper VBR because the upper VBR cannot be remotely

activated from the hot stab panel. During the post

‐ blowout well intervention

341 In its report, DNV stated that it could not rule out the possibility that the BSRs were closed

through activation of the AMF circuits.140 operation, once the pods had been pulled and rerun, only 2.3 gallons of

hydraulic fluid were pumped to close the upper VBR. This would have been an

insufficient amount of fluid to close the VBR had it been in an open state.

Furthermore, DNV found no cut upper VBR hydraulic hoses during

interventio n. The VBR was also found to be in the closed position at Michoud.

DNV found that multiple forces acted upon the drill pipe during the

blowout, resulting in the “elastic buckling” of the drill pipe. Elastic buckling can

occur when a structural element loses stability when force is applied. Once the

force causing the buckling is re moved, the object reverts to its original form.

The Panel determined that either of the following scenarios, or some

combination of them, led to the elastic buckling of the drill pipe at the time the

blind shear ram activated, which contributed to the failure of the blind shear ram

to cut the d rill pipe and seal the well:

 The forces from the blowout acting on the drill pipe pushed the tool joint

into (or further into) the upper annular element. The drill pipe was then

unable to move upward at the upper annul ar but was able to move

upward at the upper VBR; and/or

 The draw works (the equipment on the rig that supports the drill pipe that

is lowered into the riser) collapsed shortly after the explosions, thus

allowing approximately 150,000 lbs of unsupported drill pipe to act as a

downward force against the upper VBR. 342

Regardless of the conditions that led to the elastic buckling, DNV

concluded that, based upon the physical evidence of the drill pipe, wellbore, and

the BSR blocks, the drill pipe became trapped between the BSR faces, which

prevented the BSR from fully closing. 343 See Figure 12 below. DNV found that

these conditions likely occurred “from the moment the well began flowing and

would have remained until either the end conditions changed (change in Upper

Annular or Upper VBR state) or the deflected drill pipe was physically altered

(sheared).” 344

342 Testimony of Daun Winslow, Joint Investigation Hearing, August 23, 2010, at 452.

343 Addendum to Final Report for United States Department of the Interior

– Bureau of Ocean

Energy Management, Regulation and Enforcement

– Forensic Examination of the Deepwater

Horizon Blowout Preventer (April 30, 2011) (“Addendum to DNV Report”) at 11.

344 DNV Report, Vol. 1 at 4.141 Figure 12

– Off

‐ center drill pipe (Source: DNV)

2. Activation of the Casing Shear Rams

During intervention efforts, on April 29, the drill pipe was sheared using

the casing shear ram (“CSR”). 345 DNV found that the shearing of the drill pipe

changed the flow pattern within the wellbore. At the BSR, the flow had been

through the partially sheared drill pipe; the new path allowed flow up the entire

wellbore, starting at the CSR through the 2.8 inch gap along the entire length of

the block faces.

3. Automatic Mode Function

DNV concluded that it could not rule out the possibility that th e BSR was

closed through activation of the automatic mode function circuits. 346 DNV found

that there was evidence that “conditions necessary for AMF/Deadman (loss of

power, communication and hydraulic pressure) existed immediately following

the explosion/loss of rig power and prior to ROV intervention.” 347 DNV stated

that its function testing demonstrated that the AMF circuits within both pods

activated when the loss conditions were simulated. Function testing on the blue

345 DNV Report, Vol. 1 at 5.

346 Id.

347 Id. at 169. Modifications to the BOP stack are included in a timeline at Appendix F of the DNV

Report, Vol. 2 (Appendix D of this Report).142 pod showed that, in its as

‐ received condition, the 27

‐ volt batteries on the blue

pod did not have enough power to complete the AMF sequence. 348

Function testing of the yellow pod yielded inconsistent results due to one

of the solenoids (solenoid 103Y). 349 A solenoid valve, in response to an electrical

signal, opens or closes a hydraulic circuit to function BOP stack components.

This functioning allows hydraulic fluid to close the BSR.

I. Evaluation of Other Possible Failures

During the ROV interventions, there were reports of leaks in various

hydraulic circuits. DNV found th at “the evidence indicates the reported leaks in

the hydraulic circuits were not a contributor to the Blind Shear Rams being

unable to close completely and seal the well.” 350

DNV reviewed various modifications made to the control logic or to the

BOP stack prior to the blowout. DNV found that “there is no evidence these

modifications were a factor in the ability of the Blind Shear Rams being able to

close fully and seal the well.” 351

DNV tested the performance of solenoid 103Y that was removed from the

yellow pod and obtained inconsistent results. DNV observed that, when both

coils within the solenoid were activated (which is what should happen if the

solenoid was activated by the AMF circuits), the solenoid functioned properly.

But when only one of th e coils was activated, the solenoid failed to function

properly. DNV posited two theories for why this occurred. First, the solenoid

was removed in May 2010 but was not tested until March 2011. DNV found that

it was possible that seawater deposits or hydraulic fluid build

‐ up was the cause

of the inco nsistent results. Second, it was possible that the solenoid had a

manufacturing defect. DNV stated that it “did not identify any other issues or

evidence that manufacturing defects of one form or another contributed to the

Blind Shear Rams not closing completely and sealing the well.” 352

348 However, the Panel found that this was not conclusive because the blue pod may have

performed the AMF sequence some time after the loss of well control, which may have caused its

as

‐ received condition.

349 DNV Report, Vo1. 1, at 171

‐ 72.

350 Id. at 171.

351 Id. at 172

352 Id.143 DNV stated that its tests of the blue pod in its as

‐ received condition

demonstrated that “the 27 Volt battery in the Blue Pod had insufficient charge to

activate the solenoid 103B.” DNV noted that there were no records showing that

the batteries in the AMF system were tested during a factory acceptance test in

June 2009. 353 DNV further noted that tests for the 27

‐ volt battery conducted in

July 2010 (when the BOP was retrieved) “reported the battery level to be out of

specification.” 354

The Deepwater Horizon crew did not have the ability to monitor the subsea

electronic module (“SEM”) battery power supply, although the Panel is aware of

technology that exists that would allow Transocean to perform this monitoring.

If the crew had been able to monitor the SEM power supply, they could have

known th e real time condition of the AMF batteries.

Two other theories regarding the failure of the BOP stack were advanced

during JIT hearings. The first is that the hydraulic systems that powered the BSR

did not have enough power to cause the blind shear rams to fully close and seal.

A Camero n representative stated:

There is a possibility that the shear ram could have been functioned not

through the high pressure circuit but through the manifold pressure,

which would be 1,500 PSI, and it ʹ s possible that if that happened, we

wouldn ʹ t have near enough hydraulic force pressure ‐ you could not

generate enough force with that pressure to cu t the pipe. In fact, it ʹ s very

likely that the pipe would only be dented and not shear all the way

through, exposing the ram to the flows that we all have heard about. It ʹ s

also possible that for whatever reason the hydraulic system wasn ʹ t up to

the game that day and didn ʹ t ha ve sufficient pressure to close it. It is

possible that the solenoid valve, which when tested by DNV in Michoud,

operated intermittently, sometimes it wouldn ʹ t operate at all and other

times it would operate for a hand ful of seconds. And it is possible that if

the deadman fired and the solenoid valve did exactly what it did at

Michoud, that the ram could have partially deployed and not gone all the

way across. 355

353 Id

.

354 Id. at 170.

355 McWhorter testimony at 144

‐ 45.144 DNV discounted this theory for a number of reasons. First, under this

theory, someone on the bridge would have had to activate the BSR normal close

function from the toolpusher’s control panel or the driller’s control panel. DNV

concluded that no witness testimony supported this. Second, DNV pointed to

the testimony of Chris Pleasant, the Transocean subsea engineer, who testified

that the BS R was in an “open” state when he arrived at the bridge at

approximately 9:56 p.m. This was further evidence that no one had activated the

“close” function.

The second theory advanced was referred to as the “double clutch”

theory, which posited that the solenoid of the ROV supplied just enough

pressure to the hydra ulic port on the BOP to cause the BSR to go only partially

into the wellbore. 356 The Cameron representative described this as follows:

Also, there were at least a handful of cases during the course of the

intervention in which the shear rams were double clutched. In other

words, pressure was applied to the BOP and then it was relieved. It was

applied and relieved. There wer e at least a handful of times in which that

happened.

. . 357

DNV concluded that “[t]he overall contribution of this ‘double clutching’

phenomenon cannot in DNV’s opinion be of significance compared to the

contribution of the trapped pipe between the ram blocks.” 358

J. Studies Evaluating the Reliability of BOPs

Within the last decade, MMS, through its Technology Assessment and

Research Program (“TA&R”), funded or co

‐ funded various studies regarding the

reliability of BOP systems in deepwater applications, shear ram capabilities, and

the evaluation of secondary intervention methods in well control. 359 Some of

these studies pointed out deficiencies in BOP systems and made suggestions to

change MMS regulations and/or industry standards.

356 The ROV has a robotic arm that fits into a hydraulic port on the BOP stack to pump hydraulic

fluid into the BOP to close the ram blocks.

357 McWhorter testimony at 145.

358 Addendum to the DNV Report, at 10.

359 The TA&R Program supports research associated with operational safety, pollution prevention

and oil spill response and clean up activities.145 Of particular note were the 2004 West Engineering Services studies Review

of Shear Ram Capabilities and Evaluation of Shear Ram Capabilities (TAR studies 455

and 463). 360 The main goal of these studies was to answer the following question:

can a rig’s BOP equipment shear the pipe to be used in a given drilling program,

at the most demanding condition to be expected, and, if so, at what pressure?

Before answering this question, one of the studies noted that “[s]hear rams may

be a drilling operation’s last line of defense for safety and environmental

protection. ” In arriving at several conclusions and recommendations, the report

described a failure rate of 7.5% where the rams tested failed to shear pipe while

working in a maximum closing force pressure of 3,000 pounds per square inch.

In a 2003 West Engineering Services study funded by MMS, the study

acknowledged that shear ram blo cks were not designed to close and seal under

high rate conditions if closure rates were slow. The study also noted that API

Specification 16A did not require testing for rams unde r dynamic flowing

conditions. The MMS regulatory response was to require operators to submit

documentation showing that the shear rams that they used in their BOP were

capable of shearing pipe in the hole under maximum anticipated surface

pressures.

360 This study followed an MMS

‐ funded research project in 2003 (TAR study number 431) that

evaluated secondary intervention methods in well control. The goal of the research was to

evaluate the capabilities of the secondary BOP intervention systems in place at the time of study,

and identify the best practices in us e and not yet in use. The objectives of the study were to

compare and contrast the capabilities of available secondary intervention technologies; review

and contrast existing secondary intervention systems in place on deepwater drilling rigs; discuss

possible enhancements to existing systems, their benefits, and their costs; and recommend the

best pra ctices for operations in less than and greater than 3,500’ water depth. For a rig in the

dynamically positioned (DP) mode operation with a multiplex BOP control system, like the

Deepwater Horizon

, the study recommended the following secondary systems: an emergency

disconnect system, a “deadman” system to supplement the EDS syst em, the addition of an

autoshear circuit to a rig that had an AMF system, and an ROV. The Deepwater Horizon was

equipped with an emergency disconnect system, a “deadman” system, an “autoshear” system,

and ROV intervention capabilities.146 K. Maintenance of the Deepwater Horizon BOP

The following sections provide details about Transocean’s maintenance of

the Deepwater Horizon BOP stack and the BOP stack’s condition at the time of the

blowout.

1. Transocean Maintenance Plans

Transocean began to use a maintenance tracking system called RMS II

shortly after its merger with Global Santa Fe in 2007. The RMS II system is

designed to automatically flag components in need of scheduled maintenance, to

order parts, and to create work orders.

Transocean senior subsea engineer Mark Ha y described the RMS II system

as a “preventative maintenance system” used to tell the rig personnel which

pieces of equ ipment were due for maintenance. Transocean used this

maintenance tracking system to determine the different types of work that

needed to be done on the Deepwater Horizon BOP stack. 361 Transocean had

procedures to track maintenance on BOP components within their RMS II

system; however, the Company did not effectively track maintenance work on

each specific component.

The preventative maintenance orders generated from within the RMS II

system are developed using items such as original equipment manufacturer

(“OEM”) recommendations for replacing equipment based on lifetime service

hours, loads and pressures, routi ne rig move maintenance work

‐ lists, the

365/1095/1825

‐ day preventative maintenance work

‐ lists, as well as the subsea

maintenance philosophy.

2. Transocean Subsea Maintenance Philosophy

Transocean relied on a document entitled “Transocean Recommended

Practices, Subsea Maintenance Philosophy” that contained the company’s

maintenance “philoso phy” for subsea equipment. 362 In the document,

Transocean provided guidance for subsea planned maintenance tasks and for

planning for maintenance to be completed while the BOP stack was being moved

361 Testimony of Mark Hay, Joint Investigation Hearing, August 25, 2010, at 237.

362 Transocean Recommended Practices, Subsea Maintenance Philosophy, May 2007, HQS

‐ OPS

‐

RP

‐ 400

‐ 001.147 from one well to another. The document also sets forth required documentation

including maintenance records, pre/post deployment sign off, and component

condition evaluation. The document also covered the actual maintenance,

overhaul and testing of the subsea equipment. Section 8 of the document

required full function testing of the equipment prior to deployment.

Transocean required two forms to be completed and stored electronically:

a pre

‐ deployment sign

‐ off sheet and a component cond ition evaluation form.

Transocean provided the Panel with three pre

‐ deployment sign off sheets.

However, Transocean was unable to produce copies of the component condition

evaluation forms or similar documents. 363 Michael Fry, a Transocean equipment

manager, testified about why the component condition evaluation form was not

utilized:

When the subsea maintenance philosophy was originally created, the

thought process behind this form was to establish mean time between

failures and documenting problems that we were having with equipment

that we had failures with. This document wasn ʹ t really utilized, becaus e

what we ended up doing was the major [original equipment

manufacturers] have forms, like discrepancy forms, that when you send in

a piece of equipment

‐‐ Cameron, for example, uses what ʹ s called an FPR

form, I believe it ʹ s field performance report,

...

We felt later on it was best to just have the equipment sent back to th e

OEM and let them do a formal investigation of any failures and to have

them submit the inspection reports back to us. 364

Although Fry testified that Transocean relies upon these reports to make

changes to their maintenance and should have ready access to them, the Panel

found that the component condition documentation for the Deepwater Horizon

was kept on the rig, and Transocean did not appear to electronically store the

reports elsewhere. 365

Section 10 of the maintenance philosophy document further explained

that all subsea equipment was subject to an approved 1,825

‐ day test and

inspection/survey and, for the Gulf of Mexico, the 1,825

‐ day overhaul was

363 TRN

‐ USCG_MMS

‐ 00097219.

364 Testimony of Michael Fry, Joint Investigation Hearing, April 6, 2011, at 49

‐ 50

365 Id. at 50.148 dependent on the findings of the major survey. During JIT hearings, Fry was

asked about the confusion surrounding the verification of the 1,825

‐ day major

overhaul start date and how the Panel could determine when the Deepwater

Horizon’s BOP stack components were installed. Fry responded:

Ram blocks, recertification of ram blocks

‐ I mean, a ram block that gets

inspected gets inspected for damage. It gets a hardness check. It gets a

non

‐ destructive testing inspectio n done on it. If there ʹ s no damage to it,

again, there ʹ s no requirement for a mandatory recertification of it.

Normally, to kind of expand on your question, the start date is from the

date of the COC. 366

A certificate of conformity or certificate of compliance (“COC”) was

issued by the OEM. The Panel could not locate any Cameron COC for the VBR

bonnets since the installation date in 2000. Transocean also submitted

documentation stating the VBR ram blocks had not been completely overhauled

since installation in 2000. 367

The Panel also never received documentation on the required 1,825

‐ day

inspection, which should have been done in 2005 for the VBR bonnets.

According to Transocean’s subsea items scheduled to be worked on during the

2011 shipyard visit, they were scheduled to “replace or rebuild all 6 bonnets on

pipe rams.” 368

3. “Condition Based” Monitoring and Maintenance

In testimony, Transocean personnel articulated an approach to BOP stack

maintenance that they referred to as “condition based monitoring” or “condition

based maintenance.” Transocean subsea superintendant, William Stringfellow,

described this approach as follows:

Again, we use condition

‐ based monitoring, and we look at [API] RP 53 as

a recomme nded practice. Using our condition

‐ based monitoring and

testing of our systems, we can determine what kind of condition those

BOPs are actually in. And we have history to back this up through

–

we’ve actually pulled BOPs down within this time frame and there not be

366 Fry testimony at 46.

367 TRN

‐ USCG_MMS

‐ 00097144.

368 TRN

‐ USCG_MMS

‐ 00096390.149 anything wrong with them. You put new seals in them, you put them

back together, and they’re good to go.

And we determined that by performing condition

‐ based monitoring, and

in seeing any changes, whether it be through reaction times or pressure,

that we can determine whether this is worthy for work or whether we

need to be looking at replacing this piece of equ ipment. 369

Stringfellow further explained:

To take some of this equipment and disassemble it and inspect it and then

put it back into service

‐ you have to look at maintenance history, and

that’s something that I think that, you know, that you’re not aware of, of

the things that we’ve seen in the past to build this cond ition

‐ based

monitoring, which we put a lot of time and effort into for this equipment.

By doing this, we feel that we cut risk of taking

– we’ve had brand

‐ new

pieces of equipment go into service and fail. It’s called infant mortality. 370

And

– and

– and we can get off into this and into much deeper talk

– you

know, discussions. But, again, what we see right here in the way that

we’re doing this, we feel that we have a piece of equipment down there

that will do what it’s designed to do. 371

Most of the maintenance done by Transocean as a result of condition

‐

based monitoring occurs when a drilling rig moves from one location to

another. 372 This minimizes rig downtime and the costs associated with

performing the maintenance. Stringfellow testified:

Taking BOP bodies completely apart, and say, checking the sealing areas

of ring gaskets. We found that by disassembling these areas, to do an

inspection on them and then put them back together, we have more issues

with them than after we disasse mble them than we do before. I mean, we

never had a problem.

369 Testimony of William Stringfellow, Joint Investigation Hearing, August 25, 2010 at 358

‐ 59.

370 One witness described the “infant mortality” concept that equipment can fail sooner from

performing too much maintenance, disassembly, and overhaul of equipment. Fry Testimony at

69.

371 Stringfellow testimony at 375

‐ 76.

372 Hay testimony at 255.150 * * *

So, I mean, you’re talking about pulling the rig out of service and

– and,

there again, the practicality of doing this and what you gain by doing this

is weighed out. 373

Mark Hay, Transocean subsea superintendent, testified that it was well

‐

known among the “top

‐ line supervisors” on the Deepwater Horizon that the BOP

stack was outside of its three to five year major inspection requirement, and

instead Transocean was relying upon its condition

‐ based maintenance. 374

4. Planned 2011 Shipyard Maintenance

Transocean planned to bring the Deepwater Horizon in for maintenance at a

shipyard in early 2011. The planned maintenance included: (1) replace or rebuild

all 6 bonnets on pipe rams; (2) replace both 28 inch super shear ram bonnets; (3)

replace Cameron high capacity riser connector; (4) completely replace lower

annular with rebuilt annular; (5) replace all control hoses on BOP; (6) replace

diverter; (7) replace diverter flex joint; (8) blast and paint both stack and LMRP

frames; (9) change out all anodes; (10) rebuild all shuttl e valves; and (11) replace

or rebuild riser spider and gamble. 375

5. Deferring Maintenance on the BOP Stack

The Panel found that, less than a week before the blowout, BP informed

Transocean that it wanted to defer maintenance to the upper and lower annulars

(parts of the BOP stack) and agreed to accept liability if the lower annular failed

prior to th e performance of maintenance work.

Brett Cocales emailed John Guide on April 15 to discuss “Stuff for Paul

[Johnson, rig manager].” Cocales informed Guide that “Paul [Johnson] needed a

couple of things from us for the upcoming end of well work list.” The first item

373 Stringfellow testimony at 379.

374 Hay testimony at 205

‐ 06. Transocean was using conditioned based maintenance approach

notwithstanding the fact that, in 2006, MMS cited its “extended use of the BOP without

inspection/maintenance” as a contributing cause of a 2006 pollution event. MMS recommended

that “Annular BOP maintenance should be conducted per Transocean Schedule and criteria to

reduce wellb ore seal, wear, and damage.” MMS found that Transocean had recommended a

maintenance schedule, but the crew had failed to follow it. See

http://www.goboemre.gov/homepg/offsho re/safety/acc_repo /2006/060212.pdf

.

375 TRN

‐ USCG_MMS

‐ 00096390.151 stated, “He needs an email from you that states we don’t want to change the

annulars before the Nile and will accept that liability if both fail during Nile and

we have to pull the BOP. We all agree this is a low risk of having 2 failures. This

is coming from his upper management that they just wanted our confirmation

with an email.” 376

On the same evening, just minutes after receiving the email from Cocales,

Guide sent Paul Johnson an email saying he concurred with not changing the

annular elements prior to starting the Nile well. The email stated, “B[P] accepts

responsibility if both annulars were to fail and the stack had to be pulled to

repair the m.” 377 While the Panel did not find that a failure of the annulars

contributed to the failure of the BOP stack to seal the well, it did find that Guide

decided to accept liability on behalf of BP for any annular failures with

apparently little or no analysis of the conditions of the equipment.

6. Effects of th e BOP Maintenance Record on Performance

The Panel found that the Transocean’s subsea maintenance plans were

generally in accordance with Cameron’s maintenance requirements. 378 As noted

previously in this Report, the Panel found no evidence that Transocean had

submitted the variable bore rams to a major inspection (as defined in API RP 53)

any time since installation in 2000.

The Panel did not find any evidence of an actual deficiency in

Transocean’s maintenance of the BOP stack that played a role in the failure of the

BSR to shear the drill pipe and seal the well.

L. BOP System Leaks

BOP systems may develop hydr aulic fluid leaks in their various

components. Part of regular BOP stack maintenance is to identify and assess the

seriousness of leaks to hoses and valves. While Transocean asserts that there

were no leaks on the D eepwater Horizon BOP stack when it was deployed at the

376 BP

‐ HZN

‐ MBI00254566.

377 BP

‐ HZN

‐ MBI00254591.

378 Cameron Special Procedures identified in EB 902 D, CAMCG 00003345.152 Macondo well, rig personnel identified three leaks on the stack prior to the

blowout. 379

The first leak was a “very small” leak on the control hose for the upper

annular surge bottle that resulted from a loose fitting. 380 The leak was discovered

about two weeks after the Deepwater Horizon ’s BOP stack was positioned on the

Macondo well. 381 The second leak was in the lower annular; the crew never

determined where fluid was coming from but through testing ruled out a

number of components related to the annular. 382 The third leak was in the lower

test ram arising from the one of the solenoids on the yellow pod. 383 The crew

function and pressure tested the BOP stack after these leaks were discovered and

those tests were successful. 384

Mark Hay explained Transocean’s process for assessing leaks. When a

leak is discovered, he said that “you would talk to the maintenance supervisor

and OIM and then you would do a risk assessment on the rig, and then the rig

team would make a decision, and you would give field support a call with your

findings, your leak rates and all that, and they would determine if it is deemed

necessary to pull and make repairs.” 385

BP noted the leak on the lower test ram in its internal daily operations

report from February 23 until March 13. 386 Despite identifying this leak, BP did

not take steps to ensure that Transocean reported that leak in the IADC drilling

report. 387 Transocean did not record the leak on the upper annular control hose

on the IADC drilling report. 388 BP’s John Guide did not believe the leak on the

379 Hay testimony at 242; Pleasant testimony at 113. In addition, response personnel identified

BOP system leaks during efforts to shut the well in. It is not known whether those leaks

developed post

‐ blowout or existed before the blowout and were not identified by the crew.

380 Hay testimony at 193

‐ 194.

381 Id. at 244.

382 Id. at 193, 195.

383 Id. at 193

‐ 194, 196.

384 Id. at 249.

385 Id. at 243.

386 BP’s Daily Operations Reports, 02/23/10

– 03/13/2010.

387 Id

.

388 Id.153 lower test ram needed to be reported to MMS because the leak “did not affect the

function of the stack.” 389

The leaks identified did not impede the closing ability of the annular or

ram preventers. These leaks did require the placement of the BOP controls into

the “block/neutral/vent” position in order to stop or slow the hydraulic leak. The

Panel concluded that these leaks did not impede the functionality of the BOP

stack.

M. ROV Interventions

Numerous attempts were made to shut in the well using ROVs after the

rig was evacuated. On April 21, BP initially a ttempted to activate the middle

pipe ram; however, personnel experienced problems with insufficient ROV

pump volumes and hot stab tools.

On April 22, BP used an ROV to try to activ ate the autoshear function,

which would have closed the BSR. The ROV was unable to sufficiently cut the

poppet valve to activate the autoshear. 390 The next ROV attempt, on April 22, to

close the BSR by “hot stabbing” was not successful either. 391 This attempt was

hampered by the fact that the BOP stack had been modified to convert a variable

bore ram into a test ram at BP’s request. 392 The response team was not aware of

this until early May and thus made multiple efforts to hot stab the test ram under

the belief that they were hot stabbing a pipe ram. 393

Again on April 22, BP successfully cut the poppet valve for the autoshear.

This is the scenario that the Panel and DNV Report conclude likely closed the

BSR, but failed to seal the well. From April 25 through May 5, BP tried 17

additional ROV interventions to close various BOP rams and annu lar preventers.

Even though BP was able to operate many of the BOP components, none of the

attempts was successful in shutting in the well.

389 Guide testimony, July 22, 2010 at 229. However, one of the BP well site leaders on the rig,

Ronald Sepulvado, testified that he believed the leak should have been recorded in the IADC

Report. Sepulvado testimony at 26

‐ 27.

390 DNV Report, Volume 1 at 135.

391 Id. To “hot stab” is to insert a hydraulic pump, by means of an ROV’s robotic arm, into a

hydraulic port on the BOP stack to pump hydraulic fluid into the BOP ram closing system.

392 BP

‐ HZN

‐ MBI

‐ 00136647; BP, Deepwater Horizon Accident Investigation Report at 172.

393 Testimony of Harry Thierens, Joint Investigation Hearing, August 25, 2010 at 103

‐ 105.154 From the outset of ROV interventions, Transocean could not produce the

redline (as built) drawings to know how the BOP components worked and were

configured. Throughout the intervention, drawings had to be updated in

accordance with what was observed from ROV footage. According to

Transocean, they kept the redline drawings on the Deepwater Hor izon and th e

documents went down with the rig.155 

### XIII. BOP Stack Conclusions

The Panel concluded that on April 20, 2010, the Deepwater Horizon crew

closed the upper annular on the BOP stack at 9:43 p.m. as part of its initial efforts

to control the well. At 9:47 p.m., the crew closed the upper variable bore rams as

part of their continuing efforts to control th e well. When the well blew out, there

was a drill pipe tool joint located between the closed upper annular and the

closed upper variable bore rams.

A. Cause of the BOP Stack Failure

The Panel concluded that there are two possible scenarios for when the

BSR was activated. Fir st, the BSR could have been activated by the AMF while

the pipe was placed in compression by the upper annular preventer immediately

following loss of communication with the rig. Second, the BSR could have been

activated by the autoshear on April 22, while the pipe was placed in compression

by the weight of the d rill pipe and upward forces of the well. Under either

scenario, the BSR failed to shear the drill pipe and seal the wellbore because the

pipe was placed in compression outside of the cutting surface of the BSR blades.

The Panel concluded that failure of the BOP to shear the drill pipe and seal the

wellbore was cause d by the physical location of the drill pipe near the inside

wall of the wellbore, which was outside the BSR cutting surface during

activation on April 20 or April 22.

B. BOP Stack Failure Contributing Causes

The BSR co uld not fully close and seal because a portion of the drill pipe

became trapped between the BSR block faces. The elastic buckling of the drill

pipe forced the drill pipe to the side of the wellbore and outside of the BSR

cutting surface, and was a contributing ca use of the BOP failure.

C. BOP Stack Failure Possible Contributing Causes

Approximately 28 feet of drill pipe between the upper annular and the

upper variable bore ram elastically buckled within the wellbore, causing that

portion of the drill pipe to be off

‐ center. Either of the following scenarios or

some combinatio n thereof, led to elastic buckling of this pipe in this location:156  Scenario 1: Flow from the well forced the section of drill pipe

located between the closed VBR and the closed upper annular up

into the closed upper annular to a point where a tool joint stopped

against the closed upper annular. Wellbore conditions produced

enough force to cause the pipe to elastically buckle in this area.

 Scenario 2: Flow from the well and weight of the unsupported 5,000

feet of 6 5/8 inch diam eter drill pipe above the closed VBR forced

the section of drill pipe located between the upper VBR and the

upper annular into an elastically buckled sta te.

The forces described above, which led to the elastic buckling of the drill pipe,

constituted a possible contributing cause of the BOP failure.157 

### XIV. Regulatory Findings

This section addresses regulatory requirements that were in effect on

April 20, 2010. 394

Under the Outer Continental Shelf Lands Act (“OCSLA”), the Secretary of

the Interior is authorized to manage and regulate the leasing, exploration,

development, and production of resources on the Outer Continental Shelf

(“OCS”). The Secretary has delegated this authority to BOEMRE (MMS at the

time of the Macondo blowout). 395

OCSLA provides that lease or permit holders have an affirmative duty to:

(1) maintain all places of employment within the lease area or within the

area covered by such permit in compliance with occupational safety and

health standards and, in addition, free from recognized hazards to

employees of the lease holder or permit hol der or of any contractor or

subcontractor operating within such lease area or within the area covered

by such permit on the OCS;

(2) maintain all operations within such lease area or within the area

covered by such permit in compliance with regulations intended to

protect persons, property and th e environment on the OCS; and

(3) allow prompt access, at the site of any operation subject to safety

regulations, to any inspector, and to provide such documents and records

394 Since April 20, 2010, BOEMRE has implemented a number of regulatory reforms aimed at

improving drilling and workplace safety. On September 30, 2010, BOEMRE implemented the

Interim Final Rule (sometimes referred to as the “Drilling Safety Rule”) and the Workplace Safety

Rule (sometimes referred to as the “SEMS Rule” for Safety and En vironmental Management

Systems). The Interim Final Rule created new standards for well design; casing and cementing;

and well control procedures and equipment, including blowout preventers. The Workplace

Safety Rule required operators to systematically identify and address risks in order to reduce the

human and organizational errors that lie at the heart of ma ny accidents and oil spills. Effective

November 11, 2011, operators in the U.S. will be required to have a comprehensive SEMS

program that identifies the potential hazards and risk

‐ reduction strategies for all phases of

activity, from well design and construction, to operation and maintenance, and finally to the

decommissio ning of platforms.

395 Effective October 1, 2011, BOEMRE will be reorganized into two bureaus

– the Bureau of

Ocean Energy Management and the Bureau of Safety and Environmental Enforcement.158 which are pertinent to occupational or public health, safety or

environmental protection, as may be requested. 396

Under the regulations applicable at the time of the Macondo blowout,

“operators” were the persons the lessee(s) designated as having control or

management of operations on the leased area or a portion thereof. An operator

could be a lessee, the MMS

‐ approved designated agent of the lessee(s), or the

holder of operating ri ghts under an MMS

‐ approved operating rights assignment.

A “lessee” was a person who had entered into a lease with the United States to

explore for, develop, and produce the leased minerals. The term “lessee” also

applied to the MMS

‐ approved assignee of the lease, and the owner or the MMS

‐ approved assignee of operating r ights for the lease

. 397

MMS was responsible for enforcing regulations governing drilling

operations contained in 30 CFR Part 250. Subpart D covered many aspects of

drilling operations, including permitting, casing requirements, cementing

requirements, diverter systems, BOP systems, drilling fluids requirements,

equipment testing, and reporting. 398 MMS regulations made clear that lessees,

designated operators, and persons actually performing activities on the OCS

were “jointly and severally responsible” for complying with any regulation that

requires the lessee to meet a requirement or perform an action. 399

A. Permitting Process

Prior to drilling a well or sidetracking, bypassing, or deepening a well, the

operator had to obtain written approval from MMS. To obtain approval, the

operator had to:

(a) Submit the information required by 30 CFR § 250.411 through 250.418;

(b) Include the well in its approve d Exploration Plan (“EP”), Development

and Production Plan (“DPP”), or Development Operations Coordination

Document (“DOCD”); (c) Meet the oil spill financial responsibility

requirements for offshore facilities as required by 30 CFR Part 253; and (d)

396 43 U.S.C. § 1348(b).

397 See 30 CFR § 250.105.

398 Subpart D applies to lessees, operating rights owners, operators, and their contractors and

subcontractors. 30 CFR § 250.400. For ease of reference, this portion of the report will use

“operator” to mean all of these entities, unless otherwise specified.

399 30 CFR § 250.146(c).159 Submit the following forms to the District Manager: (1) An original and

two complete copies of Form MMS

‐ 123, Application for a Permit to Drill

(“APD”), and Form MMS

‐ 123S, Supplemental APD Information Sheet; (2)

A separate public information copy of forms MMS

‐ 123 and MMS

‐ 123S

that meets the requirements of 250.186; and (3) payment of the service fee

listed in § 250.125. 400

Upon receipt of the APD, MMS personnel reviewed it to determine

whether it was complete, satisfied the relevant regulatory requirements and

contained no errors. MMS personnel also assessed whether the applicant’s oil

spill financial responsibility coverage was current.

MMS used a secure, electronic filing system called e

‐ Well to process and

review AP Ds. MMS district engineers were responsible for reviewing APDs

submitted through the e

‐ Well system. Review by a drilling engineer was done

on a prioritized basis, depending on rig status and other factors.

MMS staff checked the proposed drilling rig’s maximum operating limits

for drilling depth and water depth to ensure appropriateness for the proposed

well progr am. The review included, but was not limited to, the proposed

procedure, well location and directional program, geological and geophysical

hazards, subsurface environment for pore pressure and fracture gradient,

wellbore design and schematic, design calculations for pressure containment

during drilling and completion, cement volumes, and testing pressures for the

well control equipment, casing and casing shoe. This review was performed for

shallow and deepwater drilling operations, and a hurricane risk assessment was

performed during hurricane season.

MMS personnel reviewed APDs to determine whether the propos ed

operation satisfied 30 CFR § 250.420 by meeting th e objective of safely reaching a

targeted depth. This review included an assessment of: well casing setting

depths determined by formation strength; predicted formation fluid pressure;

drilling mud weight limits; any anticipated subsurface hazards; effectiveness of

well casing strength for pressure containment at its specified depth; effectiveness

of cementing the well casing after succe ssfully securing and isolating the

hydrocarbon zones or any encountered subsurface hazards; and maintaining

400 30 CFR § 250.410.160 well control by adjusting drilling mud properties and the use of well control

equipment such as diverters and BOP stacks.

The drilling engineer approved the APD on behalf of the District Manager

after he or she reviewed the items listed above and after plan approvals were

verified by the MMS Plans Unit. A MMS District Mana ger granted approvals of

APDs, with all applicable cautions and conditions as necessary from the MMS

Geological and Geophysical unit. If the APD did not satisfy all of the review

items listed above, the drilling engineer returned the APD to the operator with

comments documenting the deficiencies that need to be corrected prior to APD

approval.

Operators routinely ga thered information and formulated drilling

programs that were much more detailed than the information required in the

APD submitted to MMS. For example, the drilling prognosis submitted with the

Macondo APD was condensed to a single page, while th e full BP drilling

program was more than 100 pages long.

If an operator changed drilling plans after submission of an APD, it was

required to submit an “application for permit to modify” (“APM”). 401 The APM

was required to include “a detailed statement of the proposed work that would

materially change from the approved APD.” 402

MMS’s Gulf of Mexico region was divided into five districts. The

Macondo well is located in the Mississippi Canyon Block 252, which is covered

by the New Orleans District. Frank Patton, an MMS drilling engineer in the New

Orleans District, approved the Macondo APD on behalf of David Trocquet, the

New Orleans District Manager.

The Panel found that Patton did not recognize that BP failed to submit

supporting documentation th at the blind shear ram in the BOP stack had the

ability to shear the drill pipe in the hole under maximum anticipated surface

pressures per 30 CFR § 250.416(e). However, the Panel reviewed ev idence that

Cameron and Transocean both determined, prior to the APD submittal, that the

Deepwater Horizon BOP stack had the ability to shear the drill pipe in use.

401 30 CFR § 250.465.

402 Id. When APMs are submitted through the e

‐ well system to revise the permit to drill, they are

submitted as a “revised permit to drill” (“RPD”). BP submitted its revised permit to drill through

the e

‐ well system.161 Patton also approved the APMs and RPDs that BP submitted to MMS for

the Macondo well, including the APMs related to BP’s temporary abandonment

of the well. BP submitted the last APM on April 16 and provided an overview of

BP’s planned temporary abandonment procedures. BP stated its intent to set a

cement plug at a depth of 8,367 feet to 8,067 feet, and explained that it needed to

set the plug deeper to minimize the chances of damaging the lock

‐ down sleeve.

Patton testi fied that he was not aware of evidence of any problems with the

Macondo well and that he believed that BP had met all applicable regulatory

requirements in submitting th e APD the APMs, and the RPDs. 403 The Panel

concluded that Patton’s review and approval of the APD was not a cause of the

Macondo blowout.

B. Well Activity Reports

After receiving MMS approval of an APD, pursuant to 30 CFR §

250.468(b), the designated operator had to submit a weekly Well Activity Report

(“WAR”) to the agenc y to report all of the specific operations at the well. The

operator had to submit the WAR into e

‐ Well weekly from the well’s spud (start)

date to the end of drilling operations at the well. The drilling engineer reviewed

the WAR for consistency with the reviewed permit and to identify any anoma lies

that warrant possible revisions to the permit or issuance of incidents of

noncompliance with the regulations. The WAR did not provide real time

information, rather, it was a snapshot of the prior seven days’ activities. The

MMS drilling engineers who reviewed the WARs on the Macondo well, Patton

and Peter Botros, note d no deficiencies on the WARs during the drilling of the

Macondo well.

C. Macondo Departures and Alternative Procedures

In the APD process, operators could seek authorization from MMS to

depart from the drilling requirements set out in 30 CFR Part 250. 404 MMS could

also allow operators to conduct alternative procedures if those procedures are

deemed to be safer or as safe as the requirements set forth in 30 CFR Part 250.

MMS granted multiple requests for departures and alternative procedures at the

Macondo well in the Macondo APD ( see Appendix I). The Panel found that these

403 Testimony of Frank Patton, Joint Investigation Hearing, May 11, 2010, at 268

‐ 69.

404 See 30 CFR § 250.142; 30 CFR § 250.409.162 departures from the regulations or alternate procedures were not a cause of the

Macondo blowout.

D. MMS Drilling Inspections

An MMS drilling inspection routinely involved a review of required

documents and records, a walk

‐ through visual inspection of the facility, and

testing of equipment. Records reviewed during a typical inspection included:

surveys; sa fety device information; records of BOP tests and inspections; records

of diverter tests; records of well control drills; documentation of maximum

pressures handled by the BOP stack; records reflecting the condition of the

drilling mud; formation integrity test results; records of leak

‐ off tests;

applications; permits; and any evidence of unreported pollution incidents.

Visual inspections typi cally included a visual assessment of: the diverter

system; classified drilling fluid handling areas; housekeeping and general safety

conditions; safety valves on the rig floor; conditions of man

‐ lift and air

‐ hoist wire

ropes; safe welding area and equipment in the area (to ensure the absence of

flammable material); grounding of electrical buildings and equipment;

emergency shutdown for diesel engines (air shut off); and operable BOP remote

control stations.

MMS inspe ctors tested the following equipment during a typical

inspection: crown block safety device; backup BOP accumulator charging

system; degasser function; mud pit level alarms; flow show alarm; gas detection

system; ventilation system and alarms; and mudlogger shack alarms. Durin g the

inspections of drilling rigs, MMS inspectors were not required to function

‐ test

the emergency disconnect systems, lower marine riser packages, or BOP stack

secondary control systems.

E. Potential Incident of Noncompliance Guidelines

To ensure consistency in the agency’s inspection progra m, MMS

inspectors performed OCS inspections using a national checklist called the

Potential Incident of Noncompliance (“PINC”) list. This list is a compilation of

yes/no questions derived from safety, environmental and regulatory

requirements relating to oil and gas operations on the OCS.

Upon detecting a violation, th e MMS inspector issued an Incident of

Noncompliance (“INC”) to the operator and used one of three main enforcement163 actions (warning, component shut

‐ in, or facility shut

‐ in), depending on the

severity of the violation. If the violation was not severe or threatening, a

warning INC was issued. The violation had to be corrected within a reasonable

amount of time, which was specified on the warning INC. The shut

‐ in INC

could be fo r a single component (a portion of the facility) or the entire facility.

The violation had to be corrected before the operator was allowed to continue the

activity in question.

In addition to the enforcement actions specified above, MMS could assess

a civil penalty of up to $35,000 per violation per day if: 1) the operator failed to

correct the violation in the reasonable amount of time specified on the INC; or 2)

the violation resulted in a serious harm or damage, or a threat of serious harm or

damage to human life, property or the environment. 405

Figure 13 presents an example of PINC guidance about subsea BOP stacks

can be found below:

Figure 13

– Example of National PINC Guidance for Drilling Inspection

The Panel determined that there was no PINC on the inspectors’ checklist

for 30 CFR § 250.446(a) at the time of the Macondo blowout. That provision

requires an operator to conduct a major inspection of BOP stack components

every three to five years. Because no PINC ex isted for this requirement, MMS

inspectors did not regularly verify that the major inspection requirements had

been met during drilling inspections.

405 43 U.S.C. § 1350(b); 30 CFR §§ 250.1403

‐ .1404. For violations that occur after July 30, 2011, the

maximum civil penalty per day will be $40,000 per day per violation.164 F. Inspection Forms

MMS inspections of drilling rigs involved a complete inspection as set out

in a PINC list

– which was, as described in the previous section, used as a

checklist of items that inspectors checked during an inspection. 406 The PINC list

was not a comprehensive list of all potential violations.

Inspectors recorded certain information on an inspection form, including

identifying data about the rig, lease and operator, but they did not record what

testing was conducted during the inspection, unless a violation was identified. 407

All information on INCs issued as a result of inspections was captured in a

central MMS database, regardless of whether the district’s inspection forms were

originally in electronic or paper form. The Panel found that not all MMS districts

used the same inspection form, and that the forms varied in length across the

districts.

G. MMS Deep water Horizon Inspections at MC 252

While the Deepwater Horizon was on location at MC 252, MMS performed

three drilling inspections on the rig. These inspections occurred on February 17,

March 3, and April 1. MMS inspectors, Bob Neal and Eric Neal, identified no

major deficiencies and issued no INCs during these ins pections.

The last inspection was completed by Eric Neal, an inspector who had

been with the agency since 2003. Even though Neal had previously participated

in 73 drilling inspections, he testified that he was “[o]nly in training” for drilling

inspections. 408 During the last inspection of the Deepwater Horizon

, Neal used the

PINC guidelines to assist him during his inspection and found no basis to issue

any INCs. 409 The Panel found no evidence that the MMS inspections of the

Deepwater Horizon conducted in 2010 were incomplete. The Panel found no

evidence that the MMS inspections of the Deepwater Horizon while on location at

Macondo were a cause of the blowout.

406 Testimony of Robert Neal, Joint Investigation Hearing, May 11, 2010, at 350

‐ 351; Testimony of

Eric Neal, Joint Investigation Hearing, May 11, 2010 at 326.

407 Eric Neal testimony at 326

‐ 329; 334

‐ 336.

408 Eric Neal testimony at 316.

409 Id

. at 325, 336.165 H. Safe Drilling Margin

MMS regulations required that “[w]hile drilling, you must maintain the

safe drilling margin identified in the approved APD [Application for Permit to

Drill]. When you cannot maintain this safe margin, you must suspend drilling

operations and remedy the situation.” 410 The safe drilling margin referenced in

the regulation is the difference between the fracture gradient and the mud

weight. The regulation did not define “safe drilling margin,” but typically, the

industry

‐ accepted safe drilling margin was 0.5 ppg. This drilling margin was

considered sufficient to allow the rig crew to circulate out a kick during the

drilling process.

I. Well Control

30 CFR § 250.401 requires an operator to take necessary precautions to

keep the well under control at al l times. This provision identified five specific

well control requirements:

 Use the best available and safest drilling technology to monitor and

evaluate well conditi ons and to minimize the potential for the well to flow

or kick;

 Have a person onsite during drilling operations who represents the

lessee’s interest and can fulfill the lessee’s responsibilities;

 Ensure that the toolpusher, operator’s representative, or a member of the

drilling crew maintains continuous surveillance on the rig floor from the

beginning of drilling operations until the wel l is completed or abandoned,

unless the operator has secured the well with BOPs, bridge plugs, cement

plugs, or packers;

 Use personnel trained according to the provisions of Subpart O of 30 CFR

Part 250; and

 Use and maintain equ ipment and materials necessary to ensure the safety

and protection of personnel, equipment, natural resources, and the

environment. 411

30 CFR Part 250 Subpart O regulations governing well control and

production safety training require operators to establish and implement training

programs that train employees to competently perform their assigned well

410 30 CFR § 250.427(b).

411 30 CFR § 250.401.166 control duties. 412 MMS could evaluate operator well control training programs

by auditing the operator’s training program, conducting written and hands

‐ on

testing, witnessing well control drills, and other methods. 413

Prior to August 2000, the regulations regarding well control training were

prescriptive. The rule prescribed the content of the well control training

curriculum and the length of the training class that each individual was required

to complete according to responsibilities. Additionally, MMS required that all

well control training providers needed to be approved by MMS.

In August 2000, MMS promulgated a performance

‐ bas ed rule that

required lessees to develop and implement their training programs. This

regulation, which became effective on October 13, 2000, required each operator

to prepare a training plan laying out the company’s training philosophy

including the type, method, length, frequency and content of its tr aining

program. Under this rule, MMS did not review and approve the training

providers nor did it specify the content of the training program. Rather, the

lessee/operator was responsible for determining the content, length, and

frequency of training programs.

Since implementing this performance

‐ based approach, MMS has used a

series of measures to periodically assess the quality of operator an d contractor

training programs. Such assessments have included a review of operator

training plans, records, and methods. MMS has also reviewed the ways in which

operators verified the training conducted by contractors.

After the Macondo blowout, BOEMRE reviewed BP’s training plan, on

‐

line training records, the methods by which BP evaluated Transocean and the

methods by which BP verified that contract personnel were trained. BOEMRE

also reviewed the contractor evaluation of Transocean. BP required all

individuals with well control res ponsibilities (both BP employees and contractor

employees) to be trained every two years. BOEMRE reviewed the training

records of all drilling personnel s tationed on the Deepwater Horizon and all BP

personnel who had well control responsibilities. The Panel concluded that BP’s

412 30 CFR § 250.1503.

413 30 CFR § 250.1507.167 training program complied with 30 CFR Part 250 Subpart O and that

Transocean’s training program met the stipulations dictated by BP. 414

BP, however, did not require the mudloggers monitoring the rig data to be

trained in well control, and such training is not required by Subpart O. The

mudloggers on in the Deepwater Horizon were employees of Sperry

‐ Sun, a

subsidiary of Halliburton. Halliburton has a well control training program for its

own personnel, but its training program did not require mudloggers to be

trained in well control operations, including kick dete ction. 415

As noted previously in this Report, the Panel found evidence that BP,

Transocean, and Halliburton violated 30 CFR § 250.401 by failing to take

necessary precautions to keep the Macondo well under control at all times. As

provided in 30 C.F.R. § 250.146, operators and contractors are jointly and

severally liable for the failure to comply with all applicable regulations.

J. Subsea BO P Regulatory Requirements

MMS regulations established certain requirements related to BOP stack

maintenance, testing, recordkeeping and inspections. Some of these regulations

incorporated by reference API Recommended Practices (“RP”), which meant that

compliance with an incorporated API RP was required as directed by the

regulation. 416 This section discusses relevant MMS regulations in place at the

time of the blowout.

1. General BOP Requirements

30 CFR § 250.440 required operators to design, install, maintain, test and

use the BOP system and system components to ensure well control. The

working

‐ pressure rating of each BOP component had to exceed maximum

anticipated surface pr essures. The BOP system includes the BOP stack and

associated BOP systems and equipment. BP calculated the Macondo well

maximum anticipated surface pressure (“MASP”) to be 6,153 psi using the well’s

estimated pore pressure at the well’s planned total depth of 20,200 feet. BP also

414 The Panel makes recommendations to improve the regulations at 30 CFR 250.1500 (Subpart O)

relating to well control training.

415 BP

‐ HZN

‐ MBI00328704.

416 1 CFR § 51.9(b)(3).168 calculated the maximum anticipated wellhead pressure (“MAWP”) at the

mudline (or BOP) was 8,404 psi. 417

2. Required Systems and Equipment

If an operator opted to use a subsea BOP stack, it had to fulfill the MMS

requirements set forth in 30 CFR § 250.442. The requirements were:

 The operator had to install the BOP system before drilling below

surface casing.

 The subsea stack had to include at least four remote

‐ con trolled,

hydraulically operated BOPs consisting of an annular BOP, two BOPs

equipped with pipe rams, and one BOP equipped with blind shear

rams.

 The operator had to install an accumulator closing system to provide

fast closure of the BOP components and to operate all critical functions

in case of a loss of the power fluid connection to the surface. The

accumulator system had to meet or exceed the provisio ns of Section

13.3 in API RP 53, Recommended Practices for Blowout Prevention

Equipment Systems for Drilling Wells.

 The BOP system had to include an operable dual

‐ pod control system to

ensure proper and independent operation of the BOP system.

 Before removing th e marine riser, the operator had to displace the riser

with sea

‐ water. The operator had to maintain sufficient hydrostatic

pressure or take other suitable precautions to compensate for the

reduction in pressure and to maintain a safe and contro lled well

condition.

Additionally, all subsea BOP systems were required to meet the

conditions set forth in 30 CFR § 250.443. This regulation required all systems to

include:

 An automatic backup to the primary accumulator

‐ charging system;

 At least two BOP control stations (one station on th e drill floor and the

other in a readily accessible location away from the drill floor);

 Side outlets on the BOP stack for separate kill and choke lines;

 A choke and kill line on the BOP stack (each to have two full opening

valves, and both to be remote

‐ con trolled if it is subsea). The choke line

417 BP’s April 15, 2010 APD.169 had to be installed above the bottom ram, the kill line could be

installed below the bottom ram;

 A fill

‐ up line above the uppermost BOP;

 Locking devices installed on the ram

‐ type BOPs; and

 A wellhead assembly with a rated working pressure that exceeds the

maximum anticipated surface pr essure (MASP). 418

3. Required Maintenance and Inspections

30 CFR § 250.446 identified BOP stack maintenance and inspection

requirements. This provision required maintenance of BOP systems to ensure

that the equipment functioned properly. It also required to visual inspections of

the subsea BOP system and riser at least once every three days if weather and sea

conditio ns permitted. Subsea BOP stack maintenance was required to meet or

exceed API RP 53 Sections 18.10, 18.11 and 18.12.

a. API RP 53 Section 18.10

Section 18.10 of API RP 53 generally prescribed recommended practices

for well inspections and maintenance and required that all leaks and

malfunctions were cor rected before BOP equipment was placed into service. API

RP 53 Section 18.10.3 recommended a “major inspection” of the BOP stack after

every three to five years of service. During the major inspection, the BOP stack,

choke manifold, and diverter components were recommended to be

disassembled and inspected in accordance with the m anufacturer’s guidelines. 419

b. API RP 53 Section 18.11

Section 18.11.3 of API RP 53 addressed BOP maintenance. Of particular

relevance here, Section 18.11.3 required that spare parts be designed for intended

use. The operator was required to consult the original equipment manufacturer

regarding replacement parts, and if parts were acquired from a non

‐ original

equipment manufacturer, “the parts shall be equivalent to or superior to the

original equipment and be fully tested, design verified, and suppo rted by

traceable documentation.” 420

418 The JIT concluded that the current 30 CFR § 250.443 contains an error; it believes that this

provision should refer to maximum allowable working pressure (MAWP), not MASP.

419 API RP 53, Section 18.10.3.

420 API RP 53, Section 18.11.3.170 The Panel found no evidence that BP consulted with Cameron about

modifying the BOP stack with parts from a non

‐ original equipment

manufacturer.

c. API RP 53 Section 18.12

Section 18.12 of API RP 53 required a lessee to have on each rig a “planned

maintenance system, with equipment identified, tasks specified, and the time

intervals between tasks stated.” Maintena nce and repair records were required

to be retained on file at the rig site or readily available.

4. BOP Pressure Tests

30 CFR § 250.447 required the operator to pressure test the BOP system

(choke manifold, valves, inside BOP, and dr ill

‐ string safety valve):

 When installed;

 Before 14 days elapsed since the last BOP pressure test; and

 Before drilling out each string of casing or a liner. 421

While performing a 14

‐ day BOP pressure test, the operator was required

to comply with 30 CFR § 250.448. This regulation required the operator to

conduct both a low

‐ pressure and a high

‐ pressure test for each BOP component.

The low

‐ pressure test had to be conducted before the high

‐ pressur e test. Each

individual test had to hold pressure for five minutes. Examples of approved

tests were:

421 The MMS District Manager had the option to allow lessees to omit the last testing requirement

if they did not remove the BOP stack to run the casing string or liner and if the required BOP test

pressures for the next section of the hole were not greater than the test pressures for the previous

BOP pressure test.171 Low

‐ pressure Test Between 200 and 300 psi

High

‐ pressure Test for ram

‐ type BOPs,

the choke manifold, and other BOP

components Rated working pressure of equipment;

or

500 psi greater than the calculated

MASP for the applicable hole section

(with MMS approval of those test

pressures)

High

‐ pressure Test for annular

‐ type

BOPs 70

‐ percent of the rated working

pressure of the equipment; or a

pressure approved in the APD

Figure 14

– BOP Pressure Tests

If the equipment failed to hold the required pressure during any of these tests,

the operator was required to correct the problem and retest the affected

component.

5. Additional BOP Tests

At the time of the blowout, the regulation included additional subsurface

BOP testing requirements, including th e following:

 Stump test of a subsea BOP system with water before installation;

 Alternate test between control stations and pods;

 Pressure test of the BSR during stump test and at all casing points;

 An interval between any BSR pressure test not exceeding 30 days;

 A pressur e test of test variable bore

‐ pipe rams against the largest and

smallest sizes of pipe in use, excluding drill collars and bottom

‐ hole tools;

 A pressure test of affected BOP components following the disconnection

or repair of any well

‐ pressure containment seal in the wellhead or BOP

stack asse mbly;

 A function test of annulars and rams every seven days between pressure

tests; and

 Actuation of safety valves assembled with proper casing connections

before running casing.172 6. BOP Recordkeeping

30 CFR § 250.450. required lessees to record the time, date and results of

all pressure tests, actuation and inspections of the BOP system in the driller’s

report. The lessee was also required to:

 Record BOP test pressures on pressure charts;

 Require onsite representation to si gn and date BOP test charts and reports

as correct;

 Document the sequential order of BOP and auxiliary equipment testing

and the pressure duration of each test (subsea BOPs record closing times

for annular and ram BOPs);

 Identify the control station and pod used during the test;

 Identify any problems or irregularities observed during BOP system

testing and record actions taken; and

 Retain all records at the facility for the duration of drillin g the well.

Additionally, operators had to maintain complete and accurate records of all well

activities including records of any significant malfunction or problem. 422

K. Regulatory Improvements

At the time of the Macondo blowout, MMS did not have a comprehensive

set of regulations specifically addressing deepwater technology, drilling, or well

design. R egulations applicable at that time to both shallow water and deepwater

drilling operations were captured in 30 CFR §§ 250.400

‐ 490 (Subpart D).

As drilling operations have moved into deeper water, operational issues

have become far more complex. This increased complexity demands appropriate

regulatory improvements. The Panel concluded that the regulations in effect at

the time of the Macondo blowout could be st rengthened in a number of ways

and that regulatory improvements may have decreased the likelihood of the

Macondo blowout.

The Recommendations section of this Report contains a number of

proposed regulatory improvements that the Panel believes would address the

following areas: ceme nt barriers in high flow potential wells; negative test

procedures; specific cementing requirements; guidance on lock

‐ down sleeve

422 30 CFR § 250.466.173 installation; dynamic flow testing of BOP stacks; guidance on ram configuration

on BOP stacks; and improvements in a number of BOEMRE inspection practices.

L. Incidents of Non

‐ Compliance

During its investigation, the Panel found evidence that BP, and in some

instances its contractors, violated the following regulations in effect at the tim e of

the blowout: 423

 30 CFR § 250.107

– BP failed to protect health, safety, property, and the

environment. BP did not: (1) perform all operations in a safe and

workmanlike manner; or (2) maintain all equipment and work areas in a

safe condition.

 30 CFR § 250.300

– BP, Transocean, and Ha lliburton (Sperry Sun) did not

prevent conditions that posed unreasonable risk to public health, life,

property, aquatic life, wildlife, recreation, navigation, commercial fishing,

or other uses of the ocean.

 30 CFR § 250.401

– BP, Transocean, and Halliburton (Sperry Sun) failed to

take necessary precautions to keep the well under control at all ti mes.

 30 CFR § 250.420(a)(1) and (2)

– BP and Halliburton did not cement the

well in a manner that would properly control formation pressures and

fluids; and prevent the direct or indirect release of fluids from any stratum

through the wellbore into offshore waters.

 30 CFR § 250.427(a)

– BP failed to use pressure integrity test and related

hole

‐ behavior observations, such as pore pressure test r esults, gas

‐ cut

drilling fluid, and well kicks to adjust the drilling fluid program and the

setting depth of the next casing string.

 30 CFR § 250.446(a)

– BP and Transocean failed to maintain the BOP

system in accordance to API RP 53 section 18.10 and 18.11.

423 This list of violations is based upon the evidence gathered by the JIT during its investigation

and upon the Panel’s findings and conclusions. Additional evidence may reveal further

violations. After this Report is released, BOEMRE will issue Incidents of Non

‐ Compliance based

upon evidence contained in this Report and/or other relevant evid ence.174  30 CFR §1721(a)– BP failed to conduct the negative test on April 20 in

accordance with the negative test procedure approved in the April 16

APM.175 

### XV. Policies and Practices of Involved Companies

A. BP’s Policies and Practices

The Panel’s investigation found that, at the time of the blowout, BP had a

number of carefully documented policies and practices addressing drilling

operations, change management, safety and risk management.

According to BP, during 2010 it was in the process of implementing a

comprehensive, comp any

‐ wide approach to management called the Operating

Management System (“OMS”). OMS was and is intended to “provide a

standardized approach that promotes effective and consistent risk management

across the company.” 424

Under BP’s OMS, local business units are responsible for implementing

their own OMS. BP’s drilling and completions unit in the Gulf of Mexico issued

its local OMS in November 2009. 425 Gulf of Mexico drilling operations are also

guided by BP’s DWOP manual and its “Beyond the Best” manual. BP drilling

operations must also follow the Company’s “golden rules” of safety.

1. BP’s Risk Assessment Policies

BP has recognized that “[t]he identification and mitigation of operating

risk is a key element of OMS” and has touted a number of its risk assessme nt and

management tools. 426 In January 2009, BP issued a company standard on

assessment, prioritization and management of risk (January 2009 standard). This

document recognizes that “[i]nconsisent or ineffective identification and

assessment of risk to health and safety of people, the environment and operating

performance can create many issues for the organization.” 427 The stated purpose

of issuing the January 2009 standard was to “provide a consistent approach to

risk management to target resources most effectively for continuous risk

reduction.” 428

424 BP Submittal to the National Commission on the BP Deepwater Horizon Oil Spill and Offshore

Drilling, entitled “BP’s Commitment to Safety” (“BP Commitment to Safety Submission”).

425 BP

‐ HZN

‐ MBI00208572.

426 BP Commitment to Safety Submission.

427 BP–HZN

‐ MBI00195284.

428 Id.176 The January 2009 standard provides that each BP facility maintain a risk

register that contains a description of identified risks and the development of an

action plan to manage those risks. It also makes clear that BP entities should seek

to identify where the workforce may have become accustomed to the presence of

the risk, or to weaknesses in safet y controls. 429

Former BP executive vice president, James “Kent” Wells summarized the

company’s OMS system as follows:

We have a number of systems. DWOP, for one, gives us guidance. We

have a system that we ʹ ve been working on for the last several years called

OMS, which is our operational management system.

And the purpose of that system is to sort of bring together so we ʹ re very

systematic and consist ent across the whole company the way we expect

things to be done. And it sets out

‐ ‐ we have some standards in there.

And what we do is we use that to set the guidelines for activity we might

do, and th en also to work with our contractors that probably already have

their own safety management systems to make sure that we believe their

systems are adequate. 430

As noted by Wells, the requirements in the January 2009 standard were

supplemented by requirements in the DWOP. BP’s DWOP required that BP

employees be present at every well site and that there be adequate procedures in

place to ensure safe drilling operations.

BP’s DWOP also covered the management of risk. Specifically, it

provided th at “[a]ll [drilling and completion] operations shall follow a

documented and auditable risk management process to include identification,

assessment, prioritization and action.” 431 The DWOP required specific

documentation and stated that the recommended tool for documenting and

managing drilling and completions risk was a web

‐ based tool called the BP risk

assessment tool (RAT).

429 BP Commitment to Safety Submission.

430 Testimony of James Wells, Joint Investigation Hearing, August 26, 2010, at 23

‐ 24.

431 BP

‐ HZN

‐ MBI00130820.177 The Panel’s investigation found that BP drilling engineers did not evaluate

or communicate the ongoing risk associated with the following:

 The production casing shoe was set in a laminated sand

‐ shale interface

in lieu of a consolidated shale;

 Deciding not to set an additional production casing barrier, such as,

setting a re tainer and/or cement plug above the float collar;

 Substantial (greater than 3,000 bbls) mud losses had occurred in the

open

‐ hole production interval, which indicated potential cementing

problems;

 The planned positive testing of the casing would have only tested the

top wiper plug and not the cement casing track below the plug;

 The float collar was not a mechanical barrier to well flow;

 No cement was left above the float collar so that there would be

enough room to run a cement eva luation log; the log was never run;

 The M56A and M56E sands were potential ly unstable because of a

difference in pore pressures; and

 There was a potential for ballooning in the open

‐ hole production

interval from 17,168 feet to 18,360 feet.

Instead of using the recommended risk assessment tool (the BP RAT

system), the Macondo engineering team used a risk register, which was a

spreadsheet that th e team created to anticipate risks and to identify individuals

assigned to mitigate risks.

John Guide testified that a register or “ledger” was used throughout the

process of drilling the well. 432 The Macondo team did not perform any risk

analyses (or mitigation analyses) using the risk register after June 20, 2009. 433

Thus, the risk register was only utilized during the Macondo well design phase

and not during BP’s execution of day

‐ to

‐ day operations at the well.

In the risk register, BP personnel identified 23 risks while planning the

well. BP personnel placed these risks into only three different categories

– cost,

production and schedule

– and chose not to categorize any of the m as “health

and safety” risks. For example, BP personnel identified a well control problem as

a “cost” and not a “health and safety” risk. The risk categories available in the

432 Guide testimony, July 22, 2010, at 64.

433 BP

‐ HZN

‐ MBI 00269180; see Appendix J.178 risk register were: health and safety, environmental, reputation, cost, schedule,

production, reserves, and net present value.

Another example of the failure of the Macondo team to fully assess risks

was its decision to only use six centralizers (as discussed in Section I). In email

about this decision, Brett Cocales wrote:

But who cares, it’s done, end of story, we’ll probably be fine and we’ll get

a good cement job. I would rather have to squeeze than get stuck above

the WH. So Guide is right on the risk/reward equation. 434

Cocales testified that the “risk/reward equation” did not have a specific

meaning within BP. 435 The Panel found no evidence reflecting a BP risk/reward

calculation on the decision of how many centralizers should be used in the well

design.

The Panel found that in the weeks leading up to the blowout on April 20,

the BP Macondo team made a series of operational decisions that re duced costs

and increased risk. The Panel did not find any explicit statements by BP

personnel that any of these decisions were made as part of a conscious cost/risk

trade

‐ off. However, the evidence the Panel reviewed suggests that the Macondo

team made a series of decisions that cut costs and saved time. Moreover, the

Panel found no evidence that the cost

‐ cutting and time

‐ saving decisions were

subje cted to the various formal risk assessment processes that BP had in place

(e.g., risk register, BP RAT, etc.). Examples of such decisions are contained in the

below chart:

434 BP

‐ HZN

‐ MBI00128409.

435 Cocales testimony at 24.179 BP Decision Less Cost to

BP Less Rig

Time Greater

Risk

6 versus 21 Centralizers Yes Yes Yes

Cement Bond Log Yes Yes Yes

Full Bottoms Up on 4/19 Yes Yes Yes

Long String versus Liner Yes Yes

‐‐

Timing of Lock Down Sleeve

Installation After the Negative

Test Yes Yes Yes

Pumping mud to boat while

displacing Yes Yes Yes

Lost circulation material (“LCM”)

pills combined for Spacer Yes Yes Unknown

Figure 15

– BP Decisions and Associated Cost, Time and Risks

2. Management of Change

– Drilling Operations

BP’s DWOP required that any significant changes to a drilling plan “shall

be documented and approved via a formal management of change (“MOC”)

process.” 436 This requirement was reinforced by the BP golden rules, which

require that “work arising from temporary and permanent changes to

organization, personnel, systems, process, procedures, equipment, products,

materials of substances, and laws and regulations cannot proceed unless a MOC

process is completed.” BP required the MOC process to include: (1) a risk

assessment conducted by all affec ted by the change; (2) a work plan that

included details regarding control measures to be implemented for equipment,

facilities, process, operations, maintenance, inspection, training, personnel,

communication, and documentation; and (3) authorization of the work plan by

responsible person(s). 437

Despite the company’s careful documentation of the importance and

necessity of the MOC process, the Macondo team did not use this process to

manage important changes occurring in day

‐ to

‐ day drilling operations.

Examples of MOC issues that were not properly documented or completed in

accordance with BP policy during drilling operations in cluded:

436 BP DWOP 4.4.

437 Id

.180  During April 14

‐ 19, 2010, BP made a number of casing design changes, but

corresponding MOC documents were never formally completed. Gregg

Walz agreed in his testimony that this was a “clerical error.” 438

 The casing design changes for the Macondo well were submitted to MMS

for approval prior to completion of the MOC process. 439

 The following operational changes were not subjected to the type of risk

analyses required by BP’s MOC policy:

(1) Rig procedure changes such as replacing the viscous spacer with

a lost circulation material. The 450 barrel lost circulation material

(M

‐ I SWACO Form

‐ A

‐ Set and Form

‐ A

‐ Squeeze) with polymer

viscosifier and weighting material added was highly thixotropic

(resistant to initia te flow) and viscous. This would lead to a

resistance to flow

‐ in in the colder kill line (located outside the

riser), which in turn would result in the suppression of pressure

readings using the kill line for the negative te st.

(2) The decision not to run the cement bond log lacked a proper risk

evaluation because several factors were not considered such as

the relatively small volume of foam cement pumped, insufficient

centralization of the casing, and questionable conversion of the

float collar. 440

David Sims testified that, during 2010, BP was in the process of converting

from a paper MOC process to an electronic process. He called the process a

“gradual, painful process.” 441 Whether the members of the Macondo team were

using the paper or electronic process, there is evidence that they were not

following BP’s carefully crafted policies on operational changes. The team’s

decision

‐ making proceeded with few or no checks and balances. On April 17,

just three days before the blowout, Guide stated in an e mail to Sims:

David, over the past four days there has [sic] been so many last minute

changes to the operation that the WSL’s [Well Site Leaders] have finally

438 Testimony of Gregg Walz, Joint Investigation Hearing, October 7, 2010, at 128.

439 Sims testimony, August 26, 2010 at 147.

440 BP did not appear to ignore the MOC process in all of its decisions. The panel found evidence

that the casing design changes for the Macondo well were subject to an MOC analysis.

441 Sims testimony at 165.181 come to their wits end. The quote is “ flying by the seat of our pants. ” More

over, we have made a special boat or helicopter run everyday. Everybody

wants to do the right thing, but, this huge level of paranoia from

engineering leadership is driving chaos. This operation is not

Thunderhorse. Brian has called me numerous times trying to make sense

of all the insanity. Las t night ʹ s emergency evolved around the 30 bbls of

cement spacer behind the top plug and how it would affect any bond

logging (I do not agree with putting the spacer above the plug to begin

with). This morning Bri an called me and asked my advice about

exploring opportunities both inside and outside of the company. What is

my authority? With the separation of engineering and operation, I do not know

what I can and can ʹ t do. The operation is not going to succeed if we continue in

this manner. (emphasis added). 442

3. Management of Change

‐ Personnel Changes

BP had MOC policies related specifically to personnel changes. The

requirements for personnel MOCs were identical to the requirements for

operational change, requiring formal risk assessment, a work plan, and

authorization. These policies applied to both temporary and permanent changes

to the organization.

Notwithsta nding the detailed personnel MOC requirements, BP appears

to have given little consideration to who would temporarily replace Sepulvado

as well site leader on the rig during temporary abandonment procedures.

Sepulvado first notified Guide on February 26 of his upcoming well control

training (scheduled for April 19 through April 24). 443 Sepulvado reminded

Guide again on April 11 that he needed to find a temporary replacement well site

leader while Sepulvado was out for training.

. 444

Kaluza informed Guide on April 12 that he could cover for Sepulvado. 445

Due to his anticipated short tenure on the rig, Kaluza was not given all access

rights to pertinent information within BP’s own system. 446 Guide approved the

replacement of Sepulvado with Kaluza on April 12 without reviewing Kaluza’s

performance evaluations. No one provided Kaluza with a detailed briefing on

442 BP

‐ HZN

‐ MBI00255906.

443 BP

‐ HZN

‐ MBI00171845.

444 BP

‐ HZN

‐ MBI00171849.

445 BP

‐ HZN

‐ MBI00171853.

446 BP

‐ HZN

‐ MBI00171859.182 problems that had been encountered during drilling operations at Macondo; nor

was he given any MOC materials. Sepulvado sent Kaluza a short email on April

16 about rig operations

– that was the only information Kaluza received from

Sepulvado prior to starting as well site leader on the Deepwater Horizon

.

Kaluza had four years of deepwater drilling experience, but no experience

on the Deepwater Hor izon and limited experience with Transocean operations.

The Panel concluded that there was adequate time for Guide to find a more

suitable replacement for Sepulvado or to perform a MOC prior to the date

Kaluza took Sepulvado’s place.

4. Job Trans ition and Handover Assurance

BP required employees to complete a job transition and handover

assurance form prior to permanent transfer from one job to another. The stated

purpose of this form was “to assure a safe and seamless job transition,” and BP

was supposed to use it “to certify that all acc ountabilities and expectations are

clear and communicated to all involved and that all performance obligations are

fulfilled.” 447

As part of the job handover process, BP required that the “incumbent”

and the “recipient” review and sign a completed form to certify the transfer of

authority. BP’s procedures stated that the team leader “ should sign the form

indicating that handover is complete” (emphasis added). 448 The job transition

and handover assurance process steps contradicted BP’s own golden rules of

safety by leaving the review and signature optional. The Panel found evidence

that three of the five job transition and handover assurance forms concerning the

personnel changes in the months preceding April 20 were not fully completed in

accordance with the instructions provided in the docu ment. 449

447 BP

‐ HZN

‐ MBI00190164. The form included the following sections: accountabilities and

expectations; transition process; business risks and critical areas of focus; health, safety, security

and environment and crisis management; information transfer; people and organization;

performance monitoring and reporting; external relationships; and communication.

448 Id.

449 During a 2010 reorganization, BP failed to follow its MOC process in the following ways:

Kevin Lacy was replaced by Pat O’Bryan and four items were not checked completed and not

signed (BP

‐ HZN

‐ MBI00190161); Brett Cocales’ transition to engineering was not completed (BP

‐

HZN

‐ MBI00190128); and Harry Thierens’ handover of wells di rector roles and accountabilities to

Dave Rich was not completed (BP

‐ HZN

‐ MBI00190128).183 5. Communication Problems

BP had a communication plan in place to alleviate some of the confusion

about who should make decisions concerning rig operations and when such

decisions should be made. According to the BP’s communication plan, BP was

responsible for all of the decisions being made on the Deepwater Horizon

.

The communication plan depicte d direct lines between the well site

leaders and onshore personnel; and there were multiple daily meetings between

BP personnel in Houston and personnel on the Deepwater Horizon

. Nonetheless,

the Panel found evidence that BP personnel in Houston did not transfer critical

information to rig personnel. As noted prev iously in this Report, this

communication failure, which resulted in the rig crew being unaware of

increasing operational risks, may have created a false sense of security among

those on the rig.

6. Health and Safety

The stated goal of BP’s safety policy was “[n]o accidents, no harm to

people and no damage to the environment.” As referenced earlier in this Report,

BP’s safety rules (called the “golden rules”) provided key controls and

procedures with whic h the workforce must comply. BP’s golden rules also

required identifying the hazards and assessing the risks associated with the

activities on a regular basis.

Kent Wells testified about BP’s sa fety policies:

Well, so our belief around safety is that we need everyone feeling

responsible for not only their own personal safety but the safety of the

people around.

And so our

– our policies and our procedures and our approach are sort of

geared towards trying to create that safety culture so it ʹ s not where one

person is tr ying to do it. We try to have everybody thinking about what

are the hazards, what activity are we going on.

We have a policy of stopping the job. We hopefully make sure that every

single employee out there know s that at any point they can stop the job184 when they believe there ʹ s a hazard that we haven ʹ t addressed or there ʹ s a

risk that needs to be dealt with. 450

Notwithstanding BP’s health and safety policies, as detailed earlier in this

Report, the Panel found that the company conducted drilling operations at

Macondo in a manner that increased the risks of the project.

7. Focus on Cost Savings

The Panel found evidence that BP personnel were compensated and their

performance reviewed, at least in part, based upon the ir abilities to control or

reduce costs. At some point in 2008, BP implemented an “every dollar counts”

program that was focused on reducing costs by improving the efficiency of

drilling operations. 451

Performance evaluations reflected this cost

‐ cutting focus. An

“operational” performance measure for BP drilling personnel was delivering a

well with costs under the authorized expenditure amount. There was no

comparable performance measure for occupational safety achievements.

The Panel reviewed performance evaluations conducted in 2009 of 13 BP

personnel involved in Macondo operations. These individuals had various

different responsibilities on the Maco ndo project; however, these evaluations

may not have been reflective of each person’s positions on April 20, 2010,

particularly given the number of reorganizations that occurred at BP. The Panel

found that 12 of the 13 evaluations completed by BP personnel captured costs

savings as a specific performance measure.

As mentioned previo usly in this Report, in the weeks leading up to April

20, the BP Macondo team made a series of operational decisions that reduced

costs and increased risks. For example, when considering the lock

‐ down sleeve

installation on the Ma condo well in January 2010, Mark Hafle and Merrick Kelley

reviewed the $2.2 million of incremental cost benefit to BP. Hafle discussed this

further with Sims, and they agreed that BP should move forward with the lock

‐

down sleeve installation after setting the surface cement plug and prior to the

departure of the Deep water Horizon from the Macondo well. This decision

450 Wells testimony at 18.

451 Guide testimony, October 7, 2010, at 141

‐ 43.185 affected the procedure for the setting of the surface plug, the displacement, and

the negative test sequence. 452

On the day of the blowout, a BP contractor suggested making an

additional wash run due to his concerns about achieving a successful lead

impression tool impression. 453 Guide responded by saying “[w]e will never

know if your million dollar flush run was needed. How does this get us to sector

leadership(?)” 454

The Panel found that a number of BP decisions were not subjected to a

formal risk assessment process. In addition, the Panel found no evidence

indicating that, at the time of the blowout, BP had in place any policy or practice

to assess whether safe operations were being compromised to achieve cost

savings.

B. Transocean’s Practices and Proce dures

1. Safety

‐ Related Policies

Transocean was responsible for the safe operation of the Deepwater

Horizon

. The company has touted its commitment to safety by pointing towards

its “company

‐ wide safety management programs and the intensive training

regimen required of its rig crews. ” 455

According to Transocean’s health and safety policy statement, “each

employee has the obligation to interrupt an operation to prevent an incident

from occurring.” 456 During 2010, Transocean had an array of acronym

‐ based

safety programs that attempted to ensure safe rig operations (THINK, START,

CAKE, FOCUS, and TOFS). Transocean designed these safety programs to allow

rig personnel to identify hazards and stop work when necessary. The Panel

found no evidence, however, that on April 20 anyone on board the Deepwater

Horizon identified risks that would warrant shutting down operations.

Transocean’s “THINK” program was designed to increase awareness of

safety issue s through task planning, hazard identification and assessment of the

452 BP

‐ HZN

‐ MBI0097490.

453 BP

‐ HZN

‐ MBI00258505.

454 BP

‐ HZN

‐ MBI00258507.

455 See Submission of Transocean to the JIT (May 13, 2011), at 1.

456 BP

‐ HZN

‐ MBI00001604.186 likely consequences of a potential incident. The THINK program attempts to

reduce risks through preventative and mitigating actions. 457 According to

Transocean documents, “[t]he THINK process reminds personnel to think about

everything they do before actually doing it.”.

. . ”THINK is used by the company

to formulate and communicate the plan.”.

. .“The THINK Planning Process is

utilized for Risk Management of all activities and tasks carried out throughout

the company.” 458

Transocean’s “START” program was a related process that is defined as

“See, Think, Act, Reinforce, and Track.” Transocean stated that the START

process “monitor[ed] the operation and reinforce[ed] safe behavior, while

correcting any unsafe acts or conditions, [and] is vital to ensure that the

necessary controls remain in place during implementation.

. . . START is use d by

the company to monitor the plan and recognize when the plan is no longer

suitable.” 459

“CAKES” was Transocean’s program for task planning. The acronym

incorporates different rules using the words comply, authority, knowledge,

experience, and skills. 460 Transocean’s “FOCUS” approach seeks to make

consistent the execution of THINK and START across the organization. 461 TOFS

(time out for safety) was Transocean’s stated policy that allowed tasks to be

stopped (planned or unplanned) to ensure safe operations. 462

None of these policies eliminated concerns about some members of the

Transocean crew. The Panel found evidence that Paul Johnston, Transocean rig

manager, questioned whether the Transocean members of the Deepwater Horizon

crew were adequately prepared to independently recognize hazards. In a March

2010 email to Guide, Johnson offered a candid assessment of the rig crew and

their abilities:

John, I thought about this a lot yesterday and asked for input from the rig

and none of us could come up with anything we are not already doing or

have done in the past with little success. There was a c ommon theme

from all though. Nothing takes the place of supervisor involvement to ask

457 See Submission of Transocean to the JIT (May 13, 2011), at 2.

458 BP

‐ HZN

‐ MBI00001764.

459 BP

‐ HZN

‐ MBI00001626.

460 BP

‐ HZN

‐ MBI00001769.

461 BP

‐ HZN

‐ MBI00001627.

462 BP

‐ HZN

‐ MBI00001770.187 that question of the hands, in the THINK Plans, and to make them think

for themselves and lead them in the right direction by mentoring them.

You can tell them what the hazards are, but until they get used to

identifying them theirselves, they are only following your lead. I haven’t

given up on this and if I have an epiphany I will send you an email.

Believe it or not when I am troubled or stumped I talke d with my wife as

she is a good listener and gets me headed in the right direction. Maybe

what we need is a new perspective on hazard recognition from someone

outside the industry. 463

Johnson’s assessment was reinforced by a March 2010 Lloyd’s Register

audit of Transocean, which found that “[Rig crews] don’t always know what

they don’t know. Front line crews are potentially working with the mindset that

they believe they are fully aware of all the hazards when it is highly likely th at

they are not.” 464

The Lloyd’s audit also evaluated the Deepwater Horizon in March 2010 and

found that there was a “strong team culture onboard Deepwater Horizon and the

levels of mutual trust evident between the crews means that the rig safety culture

was deemed to be robust, largely fair, and inclusive, which was contributing to a

‘just cu lture.’” 465 This audit found that the rig crews’ strengths were leadership,

the workforce’s influence on safety, the level of trust between the teams, and the

provision of effective resources to support safe operations. 466

But the same audit found weaknesses, including management of change

and the complexity of some risk management procedures. While the majority of

the crew was comfortable with identifying and understanding the hazards of

their respective jobs, supervisors and rig leadership teams had concerns that:

 The workforce was not always aware of the hazards they were

exposed to, relating to both their jo b and to other jobs being conducted

in the same/adjoining work areas;

 THINK Plans did not always identify relevant major hazards related to

that task;

463 BP

‐ HZN

‐ MBI00225048.

464 TRN

‐ HCEC 90501.

465 TRN

‐ HCEC 90579.

466 Id.188  The risks posed by identified hazards were not fully understood and

the subsequent control measures were not always appropriate;

 Emerging hazards during task execution, and hazards with a changing

risk level, were not always detected or fully appreciated; and

 “They don’t know what they don’t know.” 467

This difference in awareness of hazards clearly demanded attention, as

frontline crews were potentially working with a mindset that they believed they

were fully aware of all the hazards when it is likely that they were not. If a crew

is not aware of risks and hazards, it is less likely to be able to recognize unsafe

situations an d will not take immediate actions to mitigate risks.

Taken together, the audits and documentary evidence suggest that the

Deepwater Hori zon crew was generally effective and safety

‐ conscious, but may

not have had the tools, ability or opportunity to identify and mitigate hazards

associated with rig operations.

2. Transocean 21

‐ day Hitch Policy

In September 2009, Tr ansocean revised its offshore employee hitch

schedule from 14 to 21 days. The revision to the work schedules was partially

due to a transportation schedule that would allow for fewer flights to and from

the facilities. Seven of the 11 individuals who died onb oard the Deepwater

Horizon had been onboard for more than 19 days. The Panel, however, found no

evidence that the Transocean hitch schedule affected rig personnel’s ability to

perform their duties. See Appendix N.

3. Transocean Incentive Awards

Transocean had multiple bonus incentives, dependent upon level of

employment (rig, division, rig ma nagers). Variables of the bonus equations

were: safety performance; individual performance; cash flow value added; in

‐

service daily cost; rig downtime; lost revenue; and overhead cost.

Rig employees’ bonus incentives were based on 60% cost

‐ related items,

20% safety performance and 20% individual performance. Division employees’

bonus incentives were weighed in the same way: 60% cost related items, 20%

safety performance and 20% ind ividual performance. Rig managers’ bonus

467 TRN

‐ HCEC 90501.189 incentives were 50% “discretionary” factors, 37.5% cost related items and 12.5%

safety performance.

The Panel found no evidence that decisions by Transocean personnel to

defer rig maintenance and/or down time were directly rewarded with any type

of bonus payment. However, Transocean’s policy of rewarding personnel based

upon a number of different variables (e.g., dow n time, lost revenue, cash flow

value added) when trying to maintain safe operations introduced conflicting

priorities and created risks that operational decisions might compromise safety.

C. BP and Transocean Bridging Document

BP and Transocean developed a bridging document for operations

associated with deepwater drilling in North America. It outlines the

responsibility of both parties to ensure that health and safety management

systems are in place, and that al l operations are to be conducted in a safe manner.

But the bridging document did not include procedures on well control, a crucial

topic for safe drilling operations. 468 This was inconsistent with BP’s prescribed

policies for safe drilling operations. 469

D. Stop Work Authority

The Deepwater Horizon had multiple stop work policies in play on the day

of the blowout. BP, Transocean and Halliburton personnel all had company

‐ specific policies to stop work they deemed to be unsafe.

BP’s golden rules of safety state, “[e]veryone who works for or on behalf

of BP is responsible for their safety and the sa fety of those around them.” 470

Transocean’s stop work authority states, “[e]ach employee has the obligation to

interrupt an operation to prevent an incident from occurring.” 471 Halliburton’s

hazard observation and communication policy states “[t]he HOC Card has been

designed for use by all employees regardless of their position or their type or

468 The Panel located stand

‐ alone well control manuals within BP and Transocean; however, but

no document bridging the two manuals together.

469 Section 15.2.17 of BP’s DWOP requires that “a well control interface / bridging document shall

be prepared with the appropriate contractor to ensure there is clear understanding of

responsibilities and which reference documents and procedures will be used in a well control

situation.”

470 BP’s Golden Rules of Safety.

471 BP

‐ HZN

‐ MBI00001604.190 place of work. The philosophy of the company is that accidents can be prevented

by breaking the chain of events that fit together to form an accident.”

All witnesses who testified before the Panel stated that they were aware of

the stop work authority and their obligations towards safety. Nevertheless, no

stop work authority was implemented on the day of th e blowout despite the fact

that the rig crew encountered numerous anomalies that might have caused such

authority to be invoked.191 

### XVI. Conclusions Regarding Involved Companies’ Practices

BP, Transocean and Halliburton each had “stop work” programs. The

Panel found no evidence to suggest that the rig crew members were aware of the

multiple anomalies that occurred on April 19

‐ 20. The failure of the rig crew to

stop work on the Deepwater Horizon after encountering multiple hazards and

warnings was a contributing ca use of the Macondo blowout.

The Panel found no evidence that BP performed a formal risk assessment

of critical operational decisions made in the days leading up to the blowout.

BP’s failure to fully assess the risks associated with a number of operational

decisions leading up to the blowout was a contributing cause of the Macondo

blowout.

Many of the decisions made leading up the Deepwater Horizon blo wout

– including the timing of the installation of the lock

‐ down sleeve, the conducting

of multiple operations during mud displacement, and the use of lost circulation

material pills as spacer lowered the costs of the well and increased operating

risks. Thes e decisions were not subjected to a formal risk assessment

. BP’s cost

or time saving decisions without considering contingencies and mitigation

were contributing causes of the Macondo blowout.

Multiple decisions (the number of centralizers run, the decision no t to run

a cement evaluation, the decision not to circulate a full bottoms

‐ up, and others)

were in direct contradiction with the DWOP guidance to keep risk as low as

reasonably practical. BP’s failure to ensure all risks associated with operations

on the Deepwater Horizon were as low as reasonably practicab le was a

contributing cause of the Macondo blowout.

As a prudent operator, BP should have complete control of operations and

issues surrounding operations on its lease. Examples of items BP should have

had control and responsibility over are:

 Maintenance of the Deepwater Horizon ;

 General alarm configuration and operation;

 BOP 5

‐ year major inspection requirements;

 BOP modifications; and

 Cement job.192 BP’s failure to have full supervision and accountability over the activities

associated with the Deepwater Horizon was a contributing cause of the

Macondo blowout.

As part of BP’s operations integrity and risk management programs, BP

developed a systematic, risk

‐ based MOC to document, evaluate, approve and

communicate changes to facilities, systems, process, procedures, o rganization,

and personnel. The BP MOC process did not document certain critical changes,

including:

 During April 14

‐ 19, 2010, several BP casing design changes occurred, yet

multiple MOC documents were never officially completed due to a

“clerical error.”

 These casing design changes for the Macondo well were submitted to

MMS for approval pri or to the MOC being approved, according to

testimony by Sims on August 26, 2010.

 During a reorganization in 2010, the responsibility shift from the drilling

team leader (David Sims) to the drilling engineering team leader (Gregg

Walz) was not properly completed.

 A MOC was not completed for the operations drilling engineer (Bret

Cocales) in regard to his transfer to the BP dr illing engineer team.

 Examples of BP’s failure to conduct a proper risk analysis include:

(1) No formal MOC risk analysis document was completed for the

well site leader transition from Sepulvado to Kaluza.

(2) Rig procedure changes, such as replacing the viscous spacer

with lost circulation material, were not subje cted to a formal

risk analysis. The 450

‐ barrel lost circulation material (M

‐ I

SWACO Form

‐ A

‐ Set and Form

‐ A

‐ Squeeze) with polymer

viscosifier and weighting material added was highly

thyrotro phic (resistant to initiate flow) and viscous. This would

lead to a resistance to flow in the colder kill line (located outside

the riser), resulting in the suppression of pressure readings

using the kill line for the negative test.

(3) The decision not to run the cement bond log lacked a proper

risk evaluation because several fa ctors were not considered,

such as the relatively small volume of foam cement pumped,

insufficient centralization of the casing and questionable

conversion of the float collar.193 BP’s failure to document, evaluate, approve, and communicate changes

associated with Deepwater Horizon personnel and operations was a possible

contributing cause of the Macondo blowout.

BP and Transocean had a bridging document that merged their respective

safety programs. The bridging document did not address well control. BP and

Transocean had stand

‐ alone well control manuals, and the rig crew was trained

and operated in accordance with Transocea n’s manual. The failure of BP and

Transocean to ensure they had a common, integrated approach to well control

was a possible contributing cause of the Macondo blowout.

BP required its employees and contractor personnel with well control

responsibilities to be trained every two years in well control in accordance with

BP’s Subpa rt O plan. The Panel found that all personnel identified within BP’s

plan were trained in accordance with the BP Subpart O plan. The current

Subpart O rule does not identify personnel who should have trai ning in well

control operations (including monitoring the well) beyond the personnel who are

interfacing with the BOP stack and drill floor operations. The failure of the

current Subpart O rule to identify (by definition) personnel who need to be

trained in well control operations, specifically in kick detection, was a

possible co ntributing cause of the Macondo blowout.194 

### XVII. Summary of Panel Conclusions

A. Well Design and Cementing

The Panel concluded that a combination of contamination, over

‐ displacement, and possibly nitrogen breakout of the shoe cement were causes of

the blowout.

The decision to set the production casing in a laminated sand

‐ shale zone

in the vicinity of a hydrocarbon interval was a contributing cause of the blowout.

With the known losses experienced in the well, BP’s failure to take

additional precautions, such as establishing additional barriers during

cementing, was a contributing cause of the blowout.

BP and Hal liburton’s failure to perform the production casing cement job

in accordance with industry

‐ accepted recommendations as defined in API RP 65

was a contributing cause of the blowout.

BP’s decision to set the float collar across the hydrocarbon

‐ bearing zones

of interest, instead of at the botto m of the shoe, was a contributing cause of the

blowout.

BP’s failure to inform the parties operating on its behalf of all known risks

associated with Macondo well operations was a contributing cause of the

blowout.

BP’s failure to appropriately analyze and evaluate risks associated with

the Macondo well in connection with its dec ision

‐ making during the days

leading up to the blowout was a contributing cause of the blowout.

BP’s failure to place cement on top of the wiper plug was a contributing

cause of the blowout.

BP’s decision to use a float collar that was not sufficiently debris

‐ tolerant

was a possible contributing cause of the blowout.

BP’s decision to set casing in the production interval with known drilling

margin limits at total depth was a possible contributing cause of the blowout.195 The fact that the Deepwater Horizon crew members did not have available

to them accurate and reliable flow

‐ line sensors during cementing operations in

order to determine whether they were obtaining full returns was a possible

contributing cause of the blowout.

Various decisions by BP and Halliburton with respect to planning and

conducting the Macondo production casing cement job were possi ble

contributing causes of the blowout.

The failure of BP’s well site leaders and the Transocean Deepwater Horizon

rig crew to recognize the risks associated with cementing operations problems

that occurred between April 19 and April 20 was a possible contributing cause of

the blowout.

B. Flow Path

The Panel concluded that hydr ocarbon flow during the blowout occurred

through the 9

‐ 7/8 x 7 inch production casing from the shoe track as a result of

float collar and shoe track failure.

C. Temporary Abandonment, Kick Detection, and Emergency

Response

The failure of the Deep water Horizon crew (including BP, Transocean, and

Sperry

‐ Sun personnel) to detect the influx of hydrocarbons until the

hydrocarbons were above the BOP stack was a cause of the well control failure.

The Deepwater Horizon crew’s (BP and Transocean) collective

misinterpretation of the negative tests was a cause of th e well control failure.

The Deepwater Horizon crew’s inability to accurately monitor pit levels

while conducting simultaneous operations during the critical negative test was a

contributing cause of the kick detection failure.

BP’s failure to perform an incident investigation into the March 8, 2010

well control event and delayed ki ck detection was a possible contributing cause

to the April 20, 2010 kick detection failure.196 BP’s failure to inform the parties operating on its behalf of all known risks

associated with the Macondo well production casing cement job was a possible

contributing cause of the kick detection failure.

BP’s use of the lost circulation material pills as a spacer in the Macondo

well, which likely affected the crew’s ability to conduct an accurate negative test

on the ki ll line, was a possible contributing cause of the kick detection failure.

The overall complacency of the Deepwater Horizon crew was a possible

contributing cause of the kick detection failure.

Mark Hafle’s failure to investigate or resolve the negative test anomalies

noted by Donald Vidrine was a possible contributing cause of the kick detection

failure.

The failure of the well site leaders to communicate well

‐ related issues

with the ma nagers onboard the Deepwater Horizon was a possible contributing

cause of the kick detection failure.

BP’s failure to get complete and final negativ e test procedures to the rig in

a timely fashion was a possible contributing cause of the kick detection failure.

The Deepwater Horizon crew’s hesitance to shut

‐ in the BOP immediately

was a possible contributing cause of the kick detection failure.

BP’s failure to conduct the first of the two ne gative tests was a possible

contributing cause of the kick detection failure.

The rig crew’s decision to bypass the Sperry

‐ Sun flow meter while

pumping the spacer overboard was a possible contributing cause of the kick

detection failure.

The failure of BP’s and Transocean’s well control training and MMS

requirements to addr ess situations, such as negative tests and displacement

operations, was a possible contributing cause of the well control failure.

The decision to use the mud gas separator during the well control event

was a contributing cause of the response failure.197 The ambiguity within the Transocean well control manual on when to use

the diverter and not the mud gas separator was a contributing cause of the

response failure.

The failure of the personnel on the Deepwater Horizon bridge monitoring

the gas alarms to notify the Deepwater Horizon crew in the engine c ontrol room

about the alarms so that they could take actions to shut down the engines was a

contributing cause of the response failure.

The rig floor crew’s inability to determine the location of the kick in

relation to the BOP and the volume of hydrocarbons coming to the rig in a matter

of seconds was a possible contributing cause of the response failure.

The rig crew’s failure to initiate th e emergency disconnect system until

after the hydrocarbons were had risen above the BOP stack was a possible

contributing cause of the response failure.

The “inhibited” general alarm system was a possible contributing cause of

the respons e failure.

Transocean’s failure to train the marine crew to handle serious blowout

events was a possible contributing cause of the response failure.

D. Ignition Source

The most probable ignition source was either engine room number 3 or

engine room number 6.

The catastrophic failure of the mud gas separator created a possible

ignition source with the gas plume released onto th e rig from the well.

The location of the air intakes for the number 3 and number 6 engine

rooms was a contributing cause of the Deepwater Horizon explosion.

The failure of the over

‐ speed devices to initia te shutdown of the engines

was a contributing cause of the Deepwater Horizon explosion.

Fleytas’ failure to instruct the Deepwater Horizon engine room crew to

initiate the emergency shutdown sequence after receiving 20 gas alarms198 indicating the highest level of gas concentration was a contributing cause in the

Deepwater Horizon explosion.

The classification of engine rooms number 3 and number 6 as non

‐

classified areas was a possible contributing cause of the Deepwater Horizon

explosion.

The failure to identify the risks associated with locating the air inta ke of

engine room 3 in close proximity to the drill floor was a possible contributing

cause of the Deepwater Horizon explosion.

The absence of emergency shutdown devices that could be automatically

triggered in response to high gas levels on the rig was a possible contributing

cause of the Deepwater Horizon ex plosion.

The failure of ABS and Transocean to document which devices were

tested to ensure all devices are tested is a possible contributing cause of the

Deepwater Horizon explosion.

The DP MODU operating philosophy when considering the performance

of an Emergency Shutdown (ESD) is a possible contributing cause of the

Deepwater Horizon ex plosion.

E. Blowout Preventer

The Panel concluded that the failure of the BOP to shear the drill pipe and

seal the wellbore was caused by the physical location of the drill pipe near the

inside wall of the wellbore, which was outside the blind shear ram cutting

surface du ring activation on April 20 or April 22.

The elastic buckling of the drill pipe forced the drill pipe to the side of the

wellbore and outside of the BSR cutting surface, and was a contributing cause of

the BOP failure.

The forces generated by the flow from the well and/or forces generated by

the weight of the drill pipe led to the elastic buckling of the drill pipe and was a

possible contributing cause of the BOP failure.199 F. Company Practices

The failure of the crew to stop work on the Deepwater Horizon after

encountering multiple hazards and warnings was a contributing cause of the

Macondo blowout.

BP’s failure to fully assess the risks associated with a number of

operational decisions leading up to the blowout was a contributing cause of the

Macondo blowout.

BP’s cost or time saving decisions without co nsidering contingencies and

mitigation were contributing causes of the Macondo blowout.

BP’s failure to ensure all risks associated with operations on the Deepwater

Horizon were as low as reasonably practicable was a contributing cause of the

Macondo blowout.

BP’s failure to have full supervision and acc ountability over the activities

associated with the Deepwater Horizon was a contributing cause of the Macondo

blowout.

BP’s failure to document, evaluate, approve, and communicate changes

associated with Deepwater Horizon personnel and operations was a possible

contributing cause of the Macondo blowout.

The failure of BP and Transocean to ensure they had a common,

integrated approach to well control was a possible contributing cause of the

Macondo blowout.

The failure of the current Subpart O rule to id entify (by definition)

personnel who need to be trained in well control operations, specifically in kick

detection, was a possible contributing cause of the Macondo blow out.200 

### XVIII. Conclusion

As detailed in this Report, the blowout at the Macondo well on April 20,

2010 was the result of a series of decisions that increased risk and a number of

actions that failed to fully consider or mitigate those risks. While it is not

possible to discern which precise combination of these decisions and actions set

the blowout in motion, it is clear that increas ed vigilance and awareness by BP,

Transocean and Halliburton personnel at critical junctures during operations at

the Macondo well would have reduced the likelihood of the blowout occurring.

BP well designers set the casing in a locatio n that created additional risks

of hydrocarbon influx. Even knowing this, BP did not set additional cement or

mechanical barriers in the well. BP made two additional significant decisions

that further increased risks

– first, it decided to have the Deepwater Horizon crew

install a lock

‐ down sleeve as part of the temporary abandonment procedure.

Second, BP decided to use a lost circulation material as spacer, which risked

clogging lines used fo r well integrity tests.

BP personnel and Transocean personnel failed to conduct an accurate

negative test to assess the integrity of the production casing cement job. The

Deepwater Horizon rig crew, therefore, performed tempo rary abandonment

procedures while unaware of the failed cement job beneath them and the

looming influx of hydrocarbons. Unfortunately, the rig crew then limited its kick

detection abilities by deciding to bypass the Sperry Sun flow meter when

displacing fluid from the well overboard.

The Deepwater Hori zon rig crew missed signs of a kick and thus was

delayed in reacting to the well control situation. Once the flow reached the rig

floor, the crew closed the upper annular and upper variable bore ram and

diverted the flow to the mud gas separator. The mud gas separator could not

handle th e volume of the blowout and explosions followed. Additionally,

forensic analysis by DNV strongly suggests that by the time a crew member on

the bridge activated the emergency disconnect system, the explosions had

damaged the Deepwater Horizon ’s multiplex cable and hydraulic lines, which

rendered inoperable the BOP stack’s blind shear rams.

The force of the blowout, and pos sibly the force from drill pipe in the

riser, buckled the drill pipe and placed it in a position where it could not be

completely sheared by the blind shear ram blades. As a result, the blind shear201 ram, when activated on either April 20 or April 22, could not shear the drill pipe

and seal the wellbore. Flow from the Macondo well continued for 87 days after

the blowout, spewing almost 5 million barrels of oil into the Gulf of Mexico.

In the following section of this Report, the Panel makes recommend ations

to improve the safety of offshore well operations. Recommended changes to

regulatory requirements and oversight are made in the following areas: well

design (particularly for high flow potential wells), well integrity testing, kick

detection and response, rig configuration, blowout preventers, and remotely

‐ operated vehicles.202 

### XIX. Recommendations

A. Well Recommendations

1. The Agency should consider promulgating regulations that require the

negative pressure testing of wells where the wellbore will be exposed to

negative pressure conditions, such as when the BOP and riser are

disconnected from the wellhead during permanent or temporary

abandonment procedures. All subsea wells will experience a negative

pressure conditio n when the BOP and riser are disconnected from the

wellhead at either temporary or permanent abandonment time. While

operations are being conducted on a well, the mud weight exerted on the

formation is from the rig to the formation. Prior to unlatching the BOP,

the mud in the riser is displaced with seawater in preparation of th e rig to

move off of location. This reduces the effective mud weight on the

formation should a cement plug not set properly. 472 Had the Deepwater

Horizon crew interpreted the negative test properly, the blowout may have

been averted.

2. The Agency should consider incorporating in the Code of Federal

Regulation (CFR) parts of API Recommended Practice (RP) 65, parts 1 and

2; The Agency should also consider supplementing the CFR to require

compliance with specific API RP 65 requirements relating to among other

things: a mi nimum hole diameter of 3.0 inches greater than the casing

outer diameter; rathole mud density greater than cement; and mud

conditioning volume greater than one annular volume. Currently, the

CFR only requires a designated operator to provide a written statement on

how it evaluated the best practices included in API RP 65. 473

3. The Agency should research and consider, with a Notice to Lessees (NTL),

defining the term “safe drilling margin(s)” in 30 CFR § 250.414(c), which

refers to “[p]lanned safe drilling margin between proposed drilling fluid

weights and the estimated pore pressures.” The definition should be

expanded to encompass pore pressure, fracture gradient and mud weight.

This expanded definition would be benefici al to BOEMRE and industry.

472 This requirement was incorporated into the regulations with the interim final rule effective

October 14, 2010.

473 API 65 Part 2 was incorporated into the regulations with the interim final rule effective

December 2010. This recommendation is to incorporate specifics within the regulations.203 4. The Agency should consider promulgating regulations that require at

least two barriers (one mechanical and one cement barrier) for a well that

is undergoing temporary abandonment procedures. 474 As seen in this

event the only barrier between the rig and the formation was a cement

plug in the shoe track. Having a cement plug and an additional

mechanical barrier would add an increased safety factor. While the

Macondo well did have dual float valves, the Panel does not believe that

float valves should be considered a mechanical barrier. 475

5. The Agency should consider revising 30 CFR § 250.420(b)(3), which is

included in the Interim Final Rule, to clarify that a float collar/valve is not

to be considered to be a “mechanical barrier.” Float collars are designed

to prevent the cement from u

‐ tubing back into the work string; they are

not designed to keep the formation pressures from co ming up the

wellbore. A dual float valve was used in the Macondo well. Clarifying

the limitations of the float collar would prevent operators from relying on

a device not designed specifically for pressure containment. 476

6. The Agency should research and consider defining “lost returns,” “partial

returns,” “full returns,” and “cement volume margin” within 30 CFR §

250.428. As seen in this event, lost returns played a large role in

accurately determining hole stability and cement placement. However,

the regulations do not define what is considered lost returns.

B. Kick Detec tion and Response Recommendations

1. The Agency should consider issuing a Safety Alert similar to Safety Alert

284 that addresses how the movement of fluid across the rig can limit the

monitoring capabilities of rig personnel. As discussed in the Report, the

multiple simultaneous operations involving fluid move ment that were

474 This recommendation was incorporated into the regulations with the interim final rule

effective October 14, 2010.

475 This recommendation was incorporated into the regulations with the interim final rule

effective October 14, 2010.

476 30 CFR § 250.420 was revised with the interim final rule to require two barriers. This revision

allows for the use of a dual float valve or one float valve and a mechanical barrier in addition to

the cement. The Panel recommends that the agency should not allow the use of flo at valves as a

mechanical barrier.204 underway on the Deepwater Horizon prior to the blowout increased the

difficulty of monitoring the wellbore.

2. The Agency should consider researching what meter accuracy is

acceptable, as well as the placement of flow meters for the purpose of kick

detection. Flow meters are accurate within 5

‐ 10%. Placement of these

meters is critical so tha t the well can be accurately monitored and the

vessel motion effect minimized.

3. The Agency should consider revising the incident reporting rule at 30 CFR

§ 250.188 to capture well kick incidents, similar to the March 8, 2010,

Macondo well control event. Under current regulations, operators are

only required to report “losses of well control” and are not required to

report “well control” ev ents such as kicks. The reporting of these events

would allow the Agency to track them and evaluate trends that may

indicate problems with a specific operator or contractor.

4. The Agency should consider working with in dustry to develop a

standardized negative test procedure with interpretation guidance. As

discussed in this Report, BP considered several negative test procedures

without specific interpretation guidance. If interpretation guidance had

been provided to the rig crew, the early signals of the well flowing may

have been detected and the blowout averted.

5. The Agency should consider researching th e effect of water depth on kick

detection and response times in comparison to shallow water. Prompt

kick detection is critical in deepwater operations with a subsea BOP stack.

It is imperative that the rig crew detect well flow before the hydroc arbons

rise above the BOP stack. If the kick is not detected until after the

hydrocarbons rise above the BOP stack, then well control response options

are severely limited and the risks of a blowout are significant.

6. The Agency should consider promulgating a regulation at 30 CFR §

250.416 tha t allows for the limited use of mud gas separator (MGS)

systems. The Agency should consider including the requirements in API

RP 96A in this regulation. MGS systems are designed to circulate out

kicks in a controlled manner but are not designed to handle a large

volume of uncontrolled flow. Operators mu st have procedures in place to

guide the rig crew’s use of the MGS systems, and rig crews must be205 trained on these procedures. In particular, rig crews need guidance on

when to divert the flow overboard.

7. The Agency should review its procedures for analyzing the well activity

reports to determine if the operator is accurately reporting significant

anomalies (e.g., ballooning, lost returns, wellbore integrity failures).

Currently, the requirements for the well activity reports include reporting

of significant well events including, for example, lost returns, kick

occurrence, and wellbore integrity failure. Under current Agency

procedures, the engineer reviews the current approved procedure and

compares it to the well activity re port to ensure that the operator is

complying with the approved permit.

8. The Agency should clarify the wellbore monitori ng regulations contained

in 30 CFR § 250.401(c) to address potential kick detection failures, like the

ones that occurred at the Macondo well. This provision currently states

that an operator should “[e]nsure that the toolpusher, operator ʹ s

representative, or a member of th e drilling crew maintain continuous

surveillance on the rig floor from the beginning of drilling operations until

the well is completed or abandoned, unless you have secured the well

with blowout preventers (“BOPs”), bridge plugs, cement plugs, or

packers.” The Agency should clarify the meaning of the term ʺ member of

the drilling crew, ʺ which is too broad and does not addr ess specific

requirements for surveillance of the well. The Agency should also clarify

the meaning of the phrase ʺ secured the well, ʺ which does not address how

the effectiveness of different cement barriers should be evaluated and

monitored.

C. Ignition Source Recommendations

1. The Agency should consider including in the Safety Al ert discussions on

design considerations of existing and planned air intake locations,

operating philosophy when conducting design hazard analyses of Mobile

Offshore Drilling Units (MODUs), inspection and testing documentation

of all safety devices for engine shutdown, and performance of site

‐ specific

safety analyses of safe ty devices to ensure that systems align with

operating philosophy.206 2. The Agency should consider conducting unannounced inspections of all

engine compartment air intake locations for all MODUs operating on the

OCS to determine the extent of possible problems.

3. The Agency should perform an audit of mud gas separator venting

systems for all MODUs operating on the OCS to ensure that adequate

procedures are in plac e for proper use.

4. The Agency should consider working with the United States Coast Guard

to evaluate potential regulatory reforms regarding air intake locations and

the inspection and documentation of engine over

‐ speed devices.

D. Blowout Preventer Recommendations

1. The Agency should evaluate research on BO P stack sequencing and

centralization and should consider including in the Safety Alert a

recommendation to lessees using a subsea BOP stack to centralize the drill

pipe by means other than the annular preventer prior to activating the

blind shear ram (BSR).

2. The Agency should consider promulgating regulations that require

operators/contractors to have the capability to monitor th e SEM battery(s)

from the drilling rig. The SEM battery, as described in this Report, is very

important for the activation of the automatic mode function

(AMF/deadman) system. If the battery is weak, the system may not

function as it was designed. Hav ing the capability to monitor the SEM

battery status from the rig would help ensure sufficient battery power

exists to execute the system.

3. The Agency should consider researching the design options on MODUs

that could protect MUX lines during an explosion incident. As the Report

indicated, the initial explosions most likely damaged or destroyed the

MUX lines, thus rendering the rig BOP control system inoperable. Had

the system remained intact and operable, personnel may have been able to

activate any BOP function sequence.

4. The Agency should consider researching th e standardization of Remote

Operating Vehicle (ROV) intervention panels, ROV intervention

capabilities, and maximum closing times when using an ROV. On the

Deepwater Horizon

, numerous att empts were made to activate the BOP207 using multiple ROVs. During these attempts, it was discovered that the

ROV pump outputs were incapable of generating the volume needed to

shift shuttle valves and activate the BOP functions. In sum, the ROV’s

pumps did not have the same pressure and fluid flow as the accumulator

system that typically operates the BOP stack. Additionally, the ROVs

were not always equipped with th e necessary hot stabs needed to connect

to the rig

‐ specific BOP stack. Further, the ram closing times are

significantly extended when using an ROV, creating the opportunity for

ram erosion due to the uncontrolled flow of wellbore fluids and solids

across the cutting and sealing surfaces of the ram blocks

.

5. The Agency should consider researching the effects of a flowing well on

the ability of a subsea BOP to shear pipe.

6. The Agency should consider researching a blind shear ram design that

incorporates an improved pipe

‐ centering shear ram.

E. Regulatory Agency Re commendations

1. The Agency should consider revising 30 CFR § 250.443 (g) to refer to “[a]

wellhead assembly with a rated working pressure that exceeds the

maximum anticipated wellhead pressure ,” rather than “ surface pressure ,” as

the regulation currently reads.

2. The Agency should consider revising the re gulations at 30 CFR §

250.450(e) to define BOP testing ”problems or irregularities.” BP’s daily

operations reports noted that a pilot leak existed on one of the control

pods over the course of 17 days. This leak existed during a time when the

required BOP function and pressure testing occurred. Operators should

be required to report irregularities, such as this type of leak, to the

Agency.

3. The Agency should consider defining th e term “properly functioning” in

30 CFR § 250.451(d), which states, in part, that if the lessee encounters a

BOP control station or pod that do es not function properly, it must

“[s]uspend further drilling operations until that station or pod is

operable.” The Agency should also consider defining the term “proper

operation” under 30 CFR § 250.442(d), which states, “[t]he BOP system

must include an operable dual

‐ pod control system to ensure proper and

independent operations of the BO P system.” As indicated in this Report,208 there were BOP control system hydraulic leaks were noted in the daily

operations report; however, they did not impede the closing ability of the

annular or ram preventers. These leaks did require the placement of the

BOP controls into the “block/neutral/vent” position in order to stop or

slow the hydraulic leak. The Agency needs to determine if a pod with

hydraulic leaks of this nature is an “operable pod” and/or is

“function[ing] properl y.”

4. The Agency should consider promulgating regulations that would require

designated operators to report leaks associated with BOP control systems

on the IADC daily report, in the well activity report, an d to the district

drilling engineer. This would ensure that the Agency is aware of the leak

and could either require the operator to suspend operations and fix the

leak or determine that the leak will not affect the operation of the BOP

system and allow operations to continue.

5. The Agency should consider revising the de finition of “well control” at 30

CFR § 250.1500 to read as follows: “Well control means drilling, well

completion, well workover, and well servicing operations. It includes

measures, practices, procedures and equipment, such as fluid flow

monitoring, to ensure safe, accident

‐ free, and pollutio n

‐ free drilling,

completion, and workover operations as well as the installation, repair,

maintenance, and operation of surface and subsea well control

equipment.” This revision would establish minimum expectations for

who should be trained for their roles in monitoring and maintaining well

control at all times. This new definition would encompass mudloggers as

well as subsea engineers and anyone who has the responsibility fo r

monitoring the well and/or maintaining the well control equipment. As

discussed in the Report, the mudlogger played a critical role in monitoring

the well along with the driller and assistant driller. BP, however, did not

identify the mudlogger as a person needing well control traini ng or a

person responsible for monitoring the well for kick detection.

6. The Agency should consider expanding 30 CFR § 250.446 to include

documentation and record keeping requirements for major (3

‐ 5 year)

inspections as required by BOEMRE’s adoption of API RP 53, which

identifies what major inspections and maintenance should be performed.

However, API RP 53 does not indicate the necessary records needed to

document that the major inspections were performed. This recordkeeping209 would allow BOEMRE inspectors to review the major BOP inspection

records to ensure they were performed as required.

7. The Agency should consider researching the best BOP stack configuration

to minimize unsupported pipe in order to reduce the likelihood of elastic

buckling of drill pipe.

8. The Agency should consider researching th e need to require third

‐ party

surveys of the drilling packages on rigs operating on the OCS.

9. The Agency should consider researching the need for a complete

independent, acoustically controlled system for subsea BOPs. This would

eliminate the situation which occurred in this event where the MUX lines

seemed to be damaged in the explosion and rendered the surface

operation of the BOP inoperative. Having a complete independent control

system wo uld add an additional safeguard for operating the BOP stack.

10. The Agency should consider researching the need for a completely

independent BOP system (short stack) in lieu of, or in addition to, the

independe nt control system discussed in Recommendation 9. This gives

the rig a truly independent, redundant, and robust system

– unlike an

acoustic system or any other secondary system. The Deepwater Horizon

BOP stack had redundant elements, but these elements relied upon a

number of the same components to function. A completely indepe ndent

BOP control system provides true redundancy and robustness.

11. The Agency should consider promulgating regulations that would require

real

‐ time, remote capture of BOP function data. This would be beneficial

in post

‐ accident source control and subsequent investigations. Having the

data that show which rams have been activated would help analyze

interventio n options. During the Macondo source control response and

ROV intervention attempts, BP and Transocean did not know which rams

may have been activated and critical time was spent trying to function a

ram that had already been activated.

F. OCS Companies’ Practices Recommendations

The Agency should consider working with in dustry organizations to

revisit the core well control training curriculum used by most companies and210 training providers. At a minimum, well control training should encompass the

following additional subjects:

1. Understanding the different options in deepwater well control

when working from either a moored MODU or a dynamically

positioned MODU;

2. The importance of fluid flow monitoring and early kick detection in

deepwater wells;

3. Wellbore anomalies/hazards recognitio n and mitigations;

4. Recognition of limited well control options when wellbore fluids

are detected above the BOP stack;

5. Use of the diverter and limited use of the mud

‐ gas separator in a

well control event; and

6. Incorporation of the emergency disconnect function into well

control options. The Panel found that by the time the hydrocarbons

reached the rig floor it might hav e been too late to attempt to

control the flow. A better option in these cases may be to, in these

cases, immediately activate the emergency disconnect function to

disconnect from the well and stop further hydrocarbon flow.211 

## Dedication

On April 20, 2010, eleven people lost their lives onboard the Transocean

Deepwater Horizon

. The members of this Panel investigation team dedicate this

Report to the memory of the following individuals:

Jason Christopher Anderson

Aaron Dale Burkeen

Donald Neal Clark

Stephen Ray Curtis

Gordon Lewis Jones

Roy Wyatt Kemp

Karl Dale Kleppinger

, Jr.

Keith Blair Manuel

Dewey Allen Revette

Shane Michael Roshto

Adam Taylor Weise

With our findings and recommendations, we hope to improve offshore

safety and prevent the reoccurrence of a tragic event like the Macondo blowout.212 

## Acknowledgement

With the support of the crew of the Damon Bankston and the Ramblin

Wreck

, 115 survivors were able to evacuate the Deepwater Horizon and be

immediately rescued without further incident.

If the aforementioned crews did not quickly direct the search and rescue

mission, assist in muster, provide changes of clothes, and coordinate medical

attentio n and transfer of injured personnel, the death toll could have been higher.

The Damon Bankston and Ramblin Wreck crews displayed valor, leadership,

and empathy towards their fellow mariners onboard the Deepwater Horizon at a

time of peril. The well

‐ being of the 115 survivors is directly attrib utable to their

actions.

Further, BOEMRE recognizes the efforts of crews within the vicinity of

MC 252 in responding to the Deepwater Horizon blowout. These individuals were

the first responders on the scene and provided admirable assistance to their

fellow offshore employees.

Alice G. McCall Joe Griffin Ocean Intervention III

Bee sting Katrina Fagan Pat Tillman

Boa Sub C Kobe Chouest Reliance

C Express Laney Chouest Resolve Pioneer

C. Enforcer Max Chouest Sail Fish

C

‐ Pacer Miss Addison Sea Express

Fast Cajun Monica Ann Seacor Lee

Geo Searcher Sydney Seacor Vanguard

Gloria B. Callais MSC Familia Seacor Washington

Gulf Princess Norbert