Apache Seen Leading Industry in Offshore Lapses

Three years after BP Plc’s oil spill fouled Gulf of Mexico beaches, drilling safety is improving, though deficiencies remain at some of the same companies operating offshore, Democrats on a House panel said in a report.

Oil and gas producers including Apache Corp. (XOM) and Chevron Corp. (CVX) that reported the most environmental and safety incidents prior to the April 2010 spill continue to have the most violations, according to the analysis by the Democratic staff on the House Natural Resources Committee.

Committee staffers reviewed company data they said hadn’t been publicly disclosed, comparing accidents, inspections, violations and civil penalties before and after the BP spill, the worst in U.S. waters. Representative Edward Markey, the top Democrat on the panel, said the report shows the need for legislation to add U.S. inspectors and raise the fines for violations.

“Three years after the spill, instilling a new safety culture in the oil industry remains a challenge,” according to the report.

John Roper, a spokesman for Apache, said the company has more facilities than any other operator in the Gulf and its own analysis of federal records shows a lower incident rate per inspection than the industry average, he said.

“We’re very proud of our record,” Roper said in a statement.

BP Violations

The Democratic report also said that BP had 25 violations, nine classified as major. The total matches what the London-based company reported from 2007 to 2009, even though BP now operates at fewer drilling sites in the Gulf, the report said.

Gains were reported for some measures. Total injuries in offshore accidents fell by half, according to the report. Well-control issues fell to three in 2011 from an average of seven a year from 2007 to 2009, according to report.

“The industry views safety as a core value that is integral to everything we do,” said Brian Straessle, a spokesman for the American Petroleum Institute, a Washington-based group that represents oil companies. “America is becoming the world’s energy superpower, which is why we continue to develop the best technologies, safety standards, and environmental protections in the world.”

Democrats said better oversight accounted for some of the improvements. The Interior Department issued 5,188 violations in the two years after the disaster, more than 1,000 more than it had the previous two years.

Democrats also found “that facilities of top violators are still no more likely to be inspected than other facilities; that civil penalties are being imposed at about the same rate as before the BP spill; and that when such penalties are imposed, they are typically minuscule compared to company profits.”

Responses from Chevron and BP weren’t available.

To contact the reporter on this story: Jim Snyder in Washington at jsnyder24@bloomberg.net

To contact the editor responsible for this story: Jon Morgan at jmorgan97@bloomberg.net

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