avoiding liability, BP, BP oil spill, corporate responsibility, CSB, Deepwater Horizon, drilling rig, Gulf of Mexico, Largest US oil spill, oil spill, Switzerland, Tax avoidance, taxation, Transocean, Zug
[If only someone would sic the CSB on the nuclear industry!]
13 March 2015:
“Statement by CSB Chairperson Rafael Moure-Eraso Regarding the Federal Appeals Court Action on Jurisdiction to Investigate Deepwater Horizon Accident
The U.S. Fifth Circuit Court of Appeals yesterday upheld the jurisdiction of the U.S. Chemical Safety Board (CSB) to investigate the Deepwater Horizon/Macondo well blowout and explosion, turning down an appeal that the full court hear the case brought by Transocean, the owner of the drilling rig.
Other parties in the investigation, including BP, had cooperated with the CSB investigation. The accident occurred in the Gulf of Mexico in April 2010. Eleven workers were killed when escaping hydrocarbons ignited and exploded. The blowout led to the nation’s worst offshore oil spill.
This latest federal appeals court decision clearly affirms the CSB’s statutory authority to investigate fires, explosions, and releases from fixed offshore facilities, including drilling units like the Deepwater Horizon. Although the Deepwater investigation has severely taxed the CSB’s limited resources, the agency’s independent investigation has had unique benefits, since it was the first to provide a complete explanation for why the Deepwater Horizon’s blowout preventer failed and why the large oil spill occurred.
Pending appeal, Transocean in August 2013 handed over 280,000 documents subpoenaed by CSB investigators. The CSB last year released a two-volume report on the accident, with two more volumes scheduled for release within a few months. The agency is expediting the review process and hopes to have a final version presented to the Board for consideration by June.
I would like to recognize the CSB legal team’s expertise and persistence in pursuing the matter, and to thank the Department of Justice and the U.S. Attorney’s office in New Orleans for its excellent representation of the CSB. And I commend most of all the tireless work of the CSB Deepwater Horizon investigation team in this essential case.
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The CSB is an independent federal agency charged with investigating industrial chemical accidents. The agency’s board members are appointed by the president and confirmed by the Senate. CSB investigations look into all aspects of chemical accidents, including physical causes such as equipment failure as well as inadequacies in regulations, industry standards, and safety management systems.
The Board does not issue citations or fines but does make safety recommendations to plants, industry organizations, labor groups, and regulatory agencies such as OSHA and EPA.” http://www.csb.gov. http://www.csb.gov/statement-by-csb-chairperson-rafael-moure-eraso-regarding-the-federal-appeals-court-action-on-jurisdiction-to-investigate-deepwater-horizon-accident-/
“Over the years, Transocean has moved its incorporation location to take advantage of lower taxes in some jurisdictions. Transocean was originally incorporated in the US state of Delaware, but moved its corporate registration to the Cayman Islands in 1999. In 2008, it moved its registration to the canton of Zug, Switzerland, where it is currently incorporated. Only 12 of its employees work in the Zug office, according to a company spokesperson. The registration move allowed Transocean to lower its corporate income tax rate from 35 percent in the US to 16 percent in Zug.”
“Accidents and incidents
Transocean Leader accident (2002)
On 2 March 2002, a Scottish man was killed in an accident aboard the drilling rig Transocean Leader operated for BP, located about 86 miles west of Shetland, Scotland.
Galveston Bay explosion (2003)
On 17 June 2003, one worker was killed, four others were hospitalised and 21 were evacuated after an explosion on a Transocean gas drilling rig in Galveston Bay, Texas.
Transocean Rather (2005)
On 24 August 2005, the UK Health and Safety Executive issued a notice to Transocean saying that, it had failed to maintain its “remote blow Out preventor control panel … in an efficient state, efficient working order and in good repair.“ On 21 November 2005, Transocean was found to be in compliance for this matter.
Bourbon Dolphin/Transocean Rather accident (2007)
On 12 April 2007, the Bourbon Dolphin supply boat sank off the coast of Scotland while servicing the Transocean Rather drilling rig, killing eight people. The Norwegian Ministry of Justice established a Commission of Inquiry to investigate the incident, and the commission’s report found a series of “unfortunate circumstances” led to the accident “with many of them linked to Bourbon Offshore and Transocean.”
In 2008, two Transocean workers were reportedly killed on the company’s vessels.
Deepwater Horizon drilling rig explosion (2010)
On 21 April 2010, a fire was reported on a Transocean-owned semisubmersible drilling rig, Deepwater Horizon. Deepwater Horizon was a Reading & Bates Falcon RBS8D design, a firm that was acquired by Transocean in 2001. The fire broke out at 10:00 p.m. CDT UTC−5 in US waters of Mississippi Canyon 252 in the Gulf of Mexico. The rig was 41 mi (66 km) off the Louisiana coast. The US Coast Guard launched a rescue operation after the explosion which killed 11 workers and critically injured seven of the 126 member crew. Deepwater Horizon was completely destroyed and subsequently sank.
As the Deepwater Horizon sank, the riser pipe that connected the well-head to the rig was severed. As a result, oil began to spill into the Gulf of Mexico. Estimates of the leak were about 80,000 barrels per day.
Louisiana Governor Bobby Jindal declared a state of emergency on 29 April, as the oil slick grew and headed toward the most important and most sensitive wetlands in North America, threatening to destroy wildlife and the livelihood of thousands of fishermen. The head of BP Group told CNN’s Brian Todd on 28 April that the accident could have been prevented and focused blame on Transocean, which owned and partly manned the rig.
Transocean has also come under fire from lawyers, representing the fishing and tourism businesses that were hit by the oil spill and the Department of Justice for seeking to use an Limitation of Liability Act of 1851 to restrict its liability for economic damages to $26.7 million.
During Congressional testimony, Transocean and BP blamed each other for the disaster. It emerged that a “heated argument” broke out on the platform 11 hours before the accident, in which Transocean and BP personnel disagreed on an engineering decision related to the closing of the well. On 14 May 2010, US President Barack Obama commented, “I did not appreciate what I considered to be a ridiculous spectacle… executives of BP and Transocean and Halliburton [the firm responsible for cementing the well] falling over each other to point the finger of blame at somebody else. The American people could not have been impressed with that display, and I certainly wasn’t.”… Transocean later claimed that 2010, the year in which the disaster occurred, was “the best year in safety performance in our company’s history.” In a regulatory filing, Transocean said, “Notwithstanding the tragic loss of life in the Gulf of Mexico, we achieved an exemplary statistical safety record as measured by our total recordable incident rate and total potential severity rate.” They used this justification to award employees about two-thirds of the maximum possible safety bonuses. In response to broad criticism, including from Interior Secretary Ken Salazar, the company announced that its executives would donate the safety portion of the bonuses to a fund supporting the victims’ families.
Offshore drilling leak off the Brazilian coast (2011)
The offshore drilling facility “Frade” began to leak in November 2011. The Frade field is located 370 km off the coast of Rio de Janeiro in the Northern Campos Basin, Brazil. The heavy oil and gas field lies at a water depth of 1,128m and is estimated to contain 200m-300m barrels of recoverable oil. The field is operated by Chevron, which has a 51.74% interest. Other partners include Petrobras, with 30%, and Frade Japá o Petròleo, with 18.26%. The partners invested approximately $3bn in developing the field. First production was in June 2009. In September 2010, production reached 65,000bpd. Peak output of 90,000 barrels of crude oil and natural gas liquids a day is expected in 2011. The field will be operational until 2025.
Oil began leaking from the seabed at a depth of approximately 1100 to 1200m. Damage included an oil slick (oil floating on the ocean surface) covering an area of approximately 80 km2 and growing. This put the oil at a distance of about 370 km from Rio de Janeiro, but other beautiful beaches are much closer (estimated 140 km).” http://en.wikipedia.org/wiki/Transocean (Emphasis added)
Car from Zug (ZG) Tax Haven