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BP Covered Up Blow-out Two Years Prior to Deadly Deepwater Horizon Spill

Greg Palast
Eco Watch / News Analysis
Published: Friday 20 April 2012
“The first blow-out occurred on a BP rig in the Caspian Sea off the coast of Baku, Azerbaijan, in September 2008. BP was able to conceal such an extraordinary event with the help of the ruling regime of Azerbaijan, other oil companies and, our investigators learned, the Bush Administration.”
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Two years before the Deepwater Horizon blow-out in the Gulf of Mexico, another BP off-shore rig suffered a nearly identical blow-out, but BP concealed the first one from the U.S. regulators and Congress.

This week, located an eyewitness with devastating new information about the Caspian Sea oil-rig blow-out which BP had concealed from government and the industry.

The witness, whose story is backed up by rig workers who were evacuated from BP’s Caspian platform, said that had BP revealed the full story as required by industry practice, the eleven Gulf of Mexico workers “could have had a chance” of survival. But BP’s insistence on using methods proven faulty sealed their fate.

One cause of the blow-outs was the same in both cases:  the use of a money-saving technique—plugging holes with “quick-dry” cement.

By hiding the disastrous failure of its penny-pinching cement process in 2008, BP was able to continue to use the dangerous methods in the Gulf of Mexico—causing the worst oil spill in U.S. history. April 20 marks the second anniversary of the Gulf oil disaster.

There were several failures in common to the two incidents identified by the eyewitness. He is an industry insider whose identity and expertise we have confirmed. His name and that of other witnesses we contacted must be withheld for their safety.

The failures revolve around the use of “quick-dry” cement, the uselessness of blow-out preventers, “mayhem” in evacuation procedures and an atmosphere of fear which prevents workers from blowing the whistle on safety problems.

Robert F. Kennedy Jr., president of Waterkeeper Alliance and senior attorney for Natural Resources Defense Council, said, “We have laws that make it illegal to hide this kind of information. At the very least, these are lies by omission. When you juxtapose their knowledge of this incident upon the oil companies constant and persistent assurances of safety to regulators, investigators and shareholders, you have all the elements to prove that their concealment of the information was criminal.”

The first blow-out occurred on a BP rig in the Caspian Sea off the coast of Baku, Azerbaijan, in September 2008. BP was able to conceal such an extraordinary event with the help of the ruling regime of Azerbaijan, other oil companies and, our investigators learned, the Bush Administration.

Our investigation began just days after the explosion and sinking of BP’s Deepwater Horizon oil rig on April 20, 2010 when this reporterreceived an extraordinary message from a terrified witness—from a ship floating in the Caspian Sea:

        “I know how …. Would not be wise for me to communicate via [official] IT system, ….”

When the insider was contacted on a secure line, he stated that he witnessed a blow-out and the panicked evacuation of the giant BP “ACG” drilling platform.

To confirm the witness’ story, British television’s premier investigative program, Dispatches, sent this reporter under cover into Baku, Azerbaijan, with a cameraman. While approaching the BP oil terminal, the Islamic republic’s Security Ministry arrested the crew.

To avoid diplomatic difficulties, we were quickly released. However, two new witnesses suddenly vanished, all communication lost with them, after they confirmed the facts of the 2008 blow-out. Both told us they had been evacuated from the BP off-shore platform as it filled with methane.

Furthermore, witnesses confirmed that, “there was mud (drill-pipe cement) blown out all over the platform.” It appears the cement cap failed to hold back high-pressure gases which, “engulfed the entire platform in methane gas,” which is highly explosive.

In both cases, the insider told us, BP had used “quick-dry” cement to cap their well bores and the cost-saving procedure failed catastrophically. We have learned this week that BP failed to notify the International Association of Drilling Contractors (IADC) about the failure of the cement. (British companies report incidents as minor as a hammer dropped.) Notification would have alerted Gulf cement contractor Halliburton that the process of adding nitrogen to cement posed unforeseen dangers.

In fact, this past December, BP attempted to place the blame and costs of the Gulf disaster on Halliburton, the oil services company that injected quick-dry cement into the well under the Deepwater Horizon. BP told a federal court that Halliburton concealed a computer model that would show that, under certain conditions, the cement could fail disastrously. 

Following the Deepwater Horizon explosion, it became clear that nitrogen-laced mud can leave “channels” in the cement, allowing gas to escape and blow out the well-bore cap. However, that would have become clearer, and risks better assessed, had Halliburton and regulators known of the particulars of the Caspian blow-out.

We have also just learned that the cement casing itself appears to have cracked apart in the Caspian Sea. The sea, we were told, “was bubbling all around [from boiling methane]. You’re even scared to launch a life boat, it may sink.”

This exposed another problem with deepwater drilling. BP had promoted Blow-Out Preventers (BOPs) as a last line of defense in case of a blow-out. But if the casing shatters, the BOPs could be useless.

BP has gone to extraordinary lengths to conceal the story of the first blow-out, and for good reason:  If the company deliberately withheld the information that it knew “quick-dry” cement had failed yet continued to use it, the 11 deaths on its Gulf rig were not an unexpected accident but could be considered negligent homicide.

Kennedy told me, “This is a critical piece of information. The entire government is basing its policy on the assurances of this company that this process can be done safely and it never failed before. This is what they were telling everybody. Yet, the whole time they  knew that this was a process that had failed disastrously in the Caspian Sea.”

Why haven’t these stories come out before? This week our witness explained that in Azerbaijan, “People disappear on a regular basis. It’s a police state.” 

But even in the U.S. and Europe, BP and other industry workers are afraid to complain for fear their files will be marked “NRB,” for Not Required Back­­—which will end a workers’ offshore career. Jake Malloy, head of the Offshore Oil Workers Union, reached in Aberdeen, Scotland, independently confirmed statements of the whistleblowers. He noted that companies create an atmosphere of fear for one’s job with the “NRB” system and its latest variants, which discourage reports on safety problems.

BP refused an interview for this investigation, though the company responded to our written questions regarding the Caspian blow-out. Notably, the company does not deny that the blow-out occurred, nor even that it concealed the information from U.S. and UK regulators. Rather, the company says there was a “gas release”—a common and benign event, not a blow-out. As to the accusation of concealment, BP states:

“BP has shared findings from its investigation into the incident with the Azerbaijan government, [Azerbaijan] regulators, its partners and within BP.”

While BP says it issued a press release at the time of the September 2008 Caspian blow-out, the company did not tell the whole truth as reported by workers and witnesses. 

The BP press release of that day admitted only that, “a gas leak was discovered in the area of” the platform when, in fact, it was an explosion of cement and methane, say our witnesses, “which engulfed the platform.”

BP later stated that all operations on the platform were suspended as a “precautionary measure,” suggesting a distant, natural leak. In fact, the workers themselves said that, like the workers on the Deepwater Horizon, they were one spark away from death, with frightened minutes to escape.

While BP called the evacuation a by-the-textbook procedure, in fact, said our witness, “It was total mayhem,” and that a lifeboat rammed a rescue ship in the chaos. U.S. government investigators in the Gulf cite BP’s confused and chaotic evacuation procedures for possibly adding to the Deepwater Horizon’s death toll. Information about the 2008 blow-out should have led to improved procedures and possibly could have saved lives.

More seriously, BP PLC’s official filing to the U.S. Securities Exchange Commission, which requires reporting of all “material” events in company operations, again talked about a “subsurface release,” concealing that the methane blew out through its drilling stack.

Both the safety of quick-dry cement (which some drillers won’t use) and deep water drilling itself were in contention before the April 20, 2010 Gulf blow-out. In fact, the U.S. Department of Interior was refusing BP, Chevron and Exxon the right to expand the area of their deep water drilling in the Gulf over safety questions.

However, BP and the industry conducted a successful lobbying campaign to expand deep water drilling. BP’s Vice-President for operations in the Gulf, David Rainey, testified before Congress in November 2009, five months before the Deepwater Horizon explosion that, “Releases from oil and gas operations are rare.” Rainey assured Congressmen that reliable “well control techniques” such as cement caps will prevent a deep water disaster.

Rainey made no mention to Congress of the blow-out in the Caspian Sea which occurred a year before his testimony.

BP itself states that if not for Halliburton’s quick-dry cement failures, the Deepwater Horizon would never have blown out.  Halliburton defends itself by saying that BP’s methods created air channels in the cement that caused it to fail.

Notably, BP’s court Motion states, “Halliburton has deprived the Court and parties of uniquely relevant evidence.” BP claims that hiding the information about problems with the cement caused the loss of lives.

Kennedy suggests that if Halliburton’s withholding evidence was deadly, so was BP’s concealment of the cement failure in the Caspian.

Stefanie Penn Spear, editor of,  says that BP’s hiding evidence ultimately led to, “The biggest oil spill in U.S. history. It entirely turned the Gulf Coast economy upside down and threatened—and continues to threaten—the health and livelihoods of the people in the Gulf region.”

How is it that a major oil disaster, a blow-out that shut down one of the world’s biggest oil fields and required the emergency evacuation of 211 rig workers could be covered up, hidden from U.S. regulators and Congress?

The answer:  pay-offs, threats, political muscle and the connivance of the Bush Administration’s State Department, Exxon and Chevron.

Author pic
ABOUT Greg Palast

Greg Palast is the author of the New York Times bestseller, "Armed Madhouse" (Penguin Paperback 2007). When Palast, an investigator of corporate fraud and racketeering, turned his skills to journalism, he was quickly recognized as, "The most important investigative reporter of our time" [Tribune Magazine] in Britain, where his first reports appeared on BBC television and in the Guardian newspapers.

I hear you, Redslider. Yes,

I hear you, Redslider. Yes, we should sign the petition if it results in making drilling operations a little safer. But let's not be fooled into thinking that it will ever be completely safe. In fact, the vast amounts of money, I'm talking billions upon billions, that are being invested in getting oil that's difficult, dangerous and very destructive to obtain should be diverted to the development of renewables. New and not so new technologies could give us enough clean energy to keep things running, especially when combined with energy saving measures such as better insulation for buildings. As we all know these technologies are being actively suppressed, patents bought up and shelved, inventors harassed, bought off or discredited and in some cases even assasinated. That's what we're up against and that's really what we should sign petitions about.

Ever since this irresponsible

Ever since this irresponsible accident occurred, I have not spent a single penny at BP.

I realize that this "unprecedented" spill could probably have happened to ANY of the oil companies (I don't expect that any of their policies are any different, company-to-company), but it happened at BP first.

Imagine if enough of us did the same! It might send a message to the other companies to "do the right thing" (whatever that is) - at least to keep Safety higher on their list of priorities...

We need real Americans

We need real Americans running the government, not the wall street vermin it is currently infested with.

And we are SURPRISED?

And we are SURPRISED? Azerbaijan, “People Azerbaijan, “People disappear on a regular basis. It’s a police state.”

People disappear here too. With our very own Federal government's enabling our gulf shores became a police state after the BP Deepwater Horizon gusher with law enforcement and private security goons threatening and keeping journalists/reporters, environmentalists and even local elected officials from seeing and reporting the damage and what BP was really doing. People flying planes over the gulf were threatened. People taking boats out were threatened. Those people saw them burning up dolphins with their fires and spraying dispersant that our EPA said was banned all over the slicks. Now BP's "everything is wonderful now, and we're wonderful" ads compete with the API's fracking ads in terms of which is the most heinous in terms of a complete lie.

One simple question. Why does

One simple question. Why does it take an American reporter in exile in Great Britain to report this kind of a story? Isn't the real reason that the corporate media does not report explosive stories like this one anymore because it's not in the public interest? Charles "Chuck" Perlik was the longest serving president of The Newspaper Guild (1969-1067) and he warned repeatedly from at least the 1070s that media consolidation was leading to the point where all the news is controlled by a half dozen or so news outlets. Does this and other courageous stories by Gret Palast not prove that Chuck was exactly right? Please help us to fight back. Thank God we still have a First Amendment and the Internet provides instant communicns. We need to circulate alternative news from sources like Palast. So please spread the word. E-mail to as many people as possible and ask them to do likewise. Maximize the exposure by posting on your social media websites and those of any sympathetic organizations. Remember the multiplier effect. The more people see and discuss this, the more likely the corporate press will have to report on this.

Look at the occupy movement that started as the occupy Wall Street movement. Before that movement, the issue of fairness was hardly even mentioned by the media. Now it is part of regular reporting.

Again let me remind you how the press in 2000 did not report that George W. Bush was the ultimate business Schlemiel who had four oil companies and ran each into the ground. That lack of reporting and some 140,000 moronic Ralph Nader voters who thought you have to have a "perfect" ideological candidate let the George II operatives make Florida close enough that they could steal it and the presidency. A partisan Republican majority on the US Supreme Court cut off the recount and thus crowned Bush president.

We are still paying the price for this as he mismanaged the economy into the worst recession since the Great Depression. Given his record as a failed oilman can anybody be surprised?

I am determined that the Democrats don't make the same mistake this year and that our leaders hold their leaders accountable. What the corporate press is not reporting is that presumptive Republican presidential nominee Mitt Romney is advocating the same failed policies of the Schlemiel to clean up his mess? I guess to corporate America that is not news. Please help me and others fight back. Ray A. Cohn, retired polical reporter.

If I had a hammer I'd hammer

If I had a hammer
I'd hammer in the morning
I'd hammer in the evening
All over this land
I'd hammer out danger
I'd hammer out a warning
I'd hammer out love between my brothers and my sisters
All over this land

Everyday we hear about how

Everyday we hear about how we've been screwed again. The land of the free and home of the brave America I grew-up in is gone. The democratic America I grew-up in is gone. It's now a plutocracy where the oligarchs and the corporations and government officials they own are in charge. ALEC is that underground government we always heard about - the vast right-wing conspiracy Hillary warned us about... now that they've been exposed - we can see how they've managed to take control of our elected officials and judiciary and media with their money and greed. There goes our capitalism... down the toilet. Most americans haven't a pot to piss in.

Wait until Big Oil starts

Wait until Big Oil starts drilling in the environmentally-sensitive areas in the Artic. . . NO more edible seafood when (NOT if) they screw up.

It will make the Exxon Valdez disaster and "clean up" look like a anally-retentive Sunday school picnic.

The conditions in the Artic are much harsher from a weather perspective, and the waters are much rougher than the Gulf of Mexico.

If you elect Mitt Romney that

If you elect Mitt Romney that is exactly what will happen. To show you how corrupt all this was, I just finished reading the book Follow the Money by John Anderson. It lays out all these interconnections. This I already knew, but the book pointed out how "Casino Jack," AKA Jack Abramoff. was on the George W. Bush transition for the Interior Department. Later he used the people he recommended to rip off the Indians -- native Americans -- for millions of dollars. Abramoff went to casino A to persuade its officials that Casino B is seeking to shut them down. When he got done saving that casino for millions of dollars, he often returned to Casino B telling their officials that Casno A or somebody else well connected is seeking their closure. He also used his "friend" then House Masjority Leader Tom DeLay to get legislation his clients wanted passed to win approval and measures they wanted killed burried. There is much new information for me. For instance, I knew James A. Baker III was the general counsel for the influencial Saudi investment firm, the Carlyle Group. The group has a long list of Republicans from the administrations of Ronald Reagan, George H. W. Bush, George W. Bush. There are even a few officials from the Bill Clinton Administration. Another member was former British Prime Minister John Major and former officials from other countries. George I was a $250,000 per speech speaker for the group at the time of 9/11. He was at the group's annual meeting in Washington DC on 9/10. Baker, his close confidant, chief political strategist and secretary of state, was there on 9/11. So was a half brother of Osama bin Laden.

Follow the Money reveals that Baker was not only a key figure who helped the group and the Saudi Royal Family from having to face discovery in federal court, but he also has $203 million invested in the group.

The group was once dominated by the bin Laden Family. However, that was publicized in that movie Michael Moore made after 9/11 and the family divested itself from the group.

The ties between the Bush family and the bin Laden family is interesting to say the least. George II had four oil companies and ran each into the ground. In the last one he mismanaged, one of his partners was Salem bin Laden, another hafl brother of Osama. Salem was killed in a plane crash in Texas. BTW, the Twin Towers were built by the bin Laden Construction Company. And the security company that was responsible for the security of the towers on 9/11 was a Kuwaiti company in which Marvin Bush, brother of George II, and Jeb Bush and son of George I, had been a principal. Marvin, who is more famous, for mismanaging the Silverado Saving & Loan in Denver, got out of the company in 2000. However, the company on 9/11 was headed by Wirt Walker III, first cousin of George II, Marvin and Jeb. The company also had the security contract for United Air Lines and John Foster Dulles Airport. Three of United's planes were hijacked on 9/11. And one plane was hijacked from the Dulles Airport. Now my Republican friends accuse me of being "a conspiracy theorist" when I bring this up. Gang, I have not and will not suggest that the Bushes were either part of 9/11 or let it happen. Before I would accuse anybody -- especially a president I consider the worst in American history -- of a conspiracy I would have to have evidence that goes even beyond a reasonable doubt. What I brought up are facts. I am an experienced investigative reporter and for anybody to suggest something like this one has to have unimpeachable evidence.

However, I do think there is more than sufficient evidence for a need to have a complete new investigation of 9/11. I favor a new panel -- composed mostly of professional investigators and they should have both Republicans and Democrats with a proper balance -- to have a new investigation. Republicans have made all kind of allegations involving Bill Clinton and 9/11 and they should be investigated as well. In fact the panel should have a free hand how far it wants to go back.

For instance, the Reagan administration traded hostges for weapons in Iran. Did that play a role in 9/11 hapening? I followed that very closely because the longest held hostage was AP reporter Terry Anderson. I am a native of Tel Aviv and I was in Louisville not too long before Terry went to Lebanon and he told me that day about his new job. Little did I -- or for that matter he -- know what was in store for him. Ray A. Cohn

Please, bad as it is, please

Please, bad as it is, please do not be fooled into focusing on cement and evidence hidden about that. The real missing evidence, the thing that has been kept out of the hearings and media was the comment of Admiral Thad Allen, USGS Commandant, and the person in charge of the Gulf cleanup. Adm. Allen observed that the only realistic safety for off-shore drilling (short of stopping it altogether) was to drill relief wells before any primary wells were struck - what I've called "preemptive safety". Why has Adm. Allen's advice been absent from all the safety reviews and hearings. Basically because it would add about $1 million to the average $300 million cost of an offshore well (less than 3-tenths of 1%).

I you wish to do something constructive about what is happening please go and SIGN THE PETITION FOR PREEMPTIVE SAFETY at

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