1. Deepwater Horizon COMMUNICATION AND FAILURE WITHIN BP Annie Dai Jonathan Pearson Boiar Qin Victoria Wong Jason Zeng

2. Did you know…? Deepwater Horizon left 11 men dead and spilled millions of barrels of oil into the Gulf of Mexico—the worst oil spill of all time. 2

3. BP has had 3 CEOs in the last decade John BrowneTony HaywardBob Dudley 1989-20072007-20102010-??? Wall of Shame 3

4. All levels of BP were responsible for disaster CEO Misguided safety regulations No accountability for accidents Managers Narrow, profit-oriented mindset Information loss and corruption Bad decisions on project changes Engineers and Operators Failure to interpret data Lack of communication with managers 4

5. A HISTORY OF RISKY BEHAVIOR Background 5

6. For bigger oil deposits and greater profits… … oil companies move further offshore and deeper into the ocean. Depth increase in oil wells from 1940 to 2010 6

7. BP finds success in the Gulf of Mexico… BP drilling sites in the Gulf 7

8. BP disregards safety and proper protocol Texas City Refinery, 2005Alaska Oil Spill, 2006 8

9. LACK OF ACCOUNTABILITY The CEO 9

10. Personnel safety vs. Process safety “[We will] renew our commitment to safety.“ (2000) “[There will be] no stone left unturned [in the Texas City investigation]“ (2005) John Browne, CEO 1989-2007 10

11. “[We will focus] like a laser [on safety]” Tony Hayward, CEO 2007-2010 11

12. Hayward’s testimony to Congress “It’s an accident still under investigation. No one is yet accountable. This could happen to any oil company in the industry.” 12

13. Hayward’s Priorities http://www.youtube.com/watch?v=EIA_sL4cSlo 13

14. Tony Hayward faces public backlash 14

15. Change in CEO; no change in attitude “If you put aside this Macondo, 2009 was the best year we’d had, and 2010 was also heading in that direction.” Bob Dudley, CEO 2010-??? 15

16. INFORMATION LOSS AND CORRUPTION The Managers 16

17. BP commissioned Halliburton for cement expertise Cement samples 17

18. Halliburton BP February March 8 th April 13 th April 18 th -20 th Severe Failure Success! ? April 26 th April 20 th – BP pours cement “Tweaks” Parameters 18

19. BP is behind schedule First Macondo oil rig overturns 19

20. Centralizers ensure even cementing “One Piece” model “Slip On” model 20

21. Poorly Cemented Well 21

22. Centralizers ensure even cementing “One Piece” model “Slip On” model 22

23. 15 missing centralizers “…who cares, it’s done, end of story, [we] will probably be fine and we’ll get a good cement job.” 23

24. Underwater view of the well 24

25. FAILURE TO INTERPRET DATA The Engineers and Operators 25

26. First Negative Pressure Test 26 Uneven pressures before test Ideal pressure with open valve Actual test: uneven pressure with open valve

27. Second Negative Pressure Test Manual Pressure Bleed Unknown Pressure Build-up 27 Manual bleed lowers pressure Pressure builds up almost immediately

28. Third Negative Pressure Test Manual pressure bleed on kill line Pressure inside pump remains 28

29. “Bladder Effect” 29

30. Response from BP manager Mike, ????????????????????????????????????????????????????????????????? ????????????????????????????????????????????????????????????????? ????????????????????????????????????????????????????????????????? ????????????????????????????????????????????????????????????????? ????????????????????????????????????????????????????????????????? ????????????????????????????????????????????????????????????????? Regards, Pat 30

31. UNCERTAINTY Assumption: Successful Negative Pressure Test! Fear? Ignorance? Misinterpreted Data? Lack of Feedback 31

32. Kicks Drill pipe pressure log shows that when the pump (black) was off the pressure inside the well (red) increased 32

33. FINAL THOUGHTS Conclusions 33

34. BP engineer recalling the Deepwater Horizon disaster "―[a]t the end of the well sometimes they think about speeding up. This may be because everybody goes to the mindset that we‘re through, this job is done...everything‘s going to be okay." 34

35. Conclusions All Companies Don’t just fire the CEO after disaster Investigate internal communications Management Sustainability before profit Facilitate open communication Engineers Take responsibility for your work Be honest about your limits Focus on doing the job correctly 35

36. Questions? 36