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How Oil Companies Cheat

by RUSSELL MOKHIBER

BP will not be happy with Mike Mason.

Mason is a 27 year oil industry veteran who worked on oil rigs at BP facilities on the North Slope of Alaska.

He knows the ins and outs of blowout preventers.

And he says that cheating on tests for blowout preventers is widespread in the industry.

He says he’s witnessed BP cheating on such tests in the North Slope.

On January 21, 2005, Corporate Crime Reporter ran an article detailing Mason’s allegations of BP’s cheating on blowout preventer tests.

At the time, Mason was working for Nabors Alaska Drilling Inc. – a BP contractor on the North Slope.

Mason witnessed two blowouts of BP wells on the North Slope in 2003 – one on July 3 and one on December 6.

At the time, Mason was feeding information to oil industry critic Charles Hamel.

Hamel wrote to then Senator Ted Stevens (R-Alaska), asking for an investigation.

“BP and Nabors Alaska Drilling are reported to be falsifying drilling records and critical AOGCC (Alaska Oil and Gas Conservation Commission) required Blow Out Prevention tests as well as concealing from AOGCC and ADEC (Alaska Department of Environmental Conservation) at least two reportable blow-out/spills,” Hamel wrote.

The Wall Street Journal followed up with a story on February 5, 2005.

As a result of the Corporate Crime Reporter and Wall Street Journal articles, investigations were launched.

In June 2005, the Alaska Oil & Gas Conservation Commission (AOGCC) ruled that a Nabors’ employee had falsified blowout preventer tests.

How?

Chart spinning.

What is chart spinning?

Well, to test a blowout preventer, you build up the pressure for five minutes.

And you record the pressure test on a chart.

The Commission found that the Nabors employee cheated.

They built up the pressure for only one minute.

Or two minutes.

And then manually moved the chart to show that it had been pressurized for the required five minutes.

Nabors also investigated the situation and agreed with the Commission’s findings.

The Commission ordered Nabors to pay $10,000 in costs.

And according to Mason, Nabors fired the responsible manager.

But Mason says that that was just one instance.

He says that cheating on blow out prevention tests is a way of life in the oil industry.

“They cheat to save money and time,” Mason said.

Mason says he personally witnessed BP managers repeatedly cheating on blowout prevention tests.

But BP was never charged.

Why not?

Mason says that he spoke with the Nabors manager who was fired.

And the Nabors manager who was fired said that he wouldn’t tell investigators who at BP was complicit.

Why did the Nabors manager take the fall for the BP managers?

“That’s just the type of person he was,” Mason says. “He wasn’t the type of person who was going to turn other people in.”

Mason was fired from his job at Nabors on July 16, 2006, four days after he wrote a letter to the editor of the Anchorage Daily News.

In the letter, Mason criticizes Nabors for incorporating in Barbados for tax reasons.

“My son has made a commitment to his country, and I will see him off to Iraq soon,” Mason wrote. “All I can think about is he could end up making the ultimate sacrifice for his country and at the same time Nabors is avoiding their responsibilities as Americans. Forget Benedict Arnold. Nabors Industries is the ultimate American traitor.”

Mason says his son has done two tours in Iraq and is now home safe in Texas.

RUSSELL MOKHIBER is the editor of the Corporate Crime Reporter.

WORDS THAT STICK

 

More articles by:

Russell Mokhiber is the editor of the Corporate Crime Reporter..

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