Deepwater Horizon Report Highlights Faulty Decisionmaking

The presidential panel investigating the causes of the Deepwater Horizon/BP spill in the Gulf of Mexico released one chapter of its report on the critical causes of the blowout, which released over 200 million gallons of oil into the Gulf of Mexico last year. The report is available here. The report blames the blowout on a series of time-saving and cost saving shortcuts approved by BP and Halliburton, as well as lax, or nearly non-existent, oversight by MMS.

The critical conclusion of the report reads:

Decisionmaking processes at Macondo did not adequately ensure that personnel fully considered the risks created by time- and money-saving decisions. Whether purposeful or not, many of the decisions that BP, Halliburton, and Transocean made that increased the risk of the Macondo blowout clearly saved those companies significant time (and money).*
There is nothing inherently wrong with choosing a less-costly or less-time-consuming alternative—as long as it is proven to be equally safe. The problem is that, at least in regard to BP’s Macondo team, there appears to have been no formal system for ensuring that alternative procedures were in fact equally safe. None of BP’s (or the other companies’) decisions in Figure 4.10 appear to have been subject to a comprehensive and systematic risk-analysis, peer-review, or management of change process. The evidence now available does not show that the BP team members (or other companies’ personnel) responsible for these decisions conducted any sort of formal analysis to assess the relative riskiness of available alternatives.

There is nothing surprising about industry shortcutting safety measures and captive agencies approving these shortcuts without substantive review. While the report suggests stronger regulations as an appropriate responsive, lax enforcement and freely granted waivers will always plague an activity like offshore drilling where the dollar stakes are high, and citizen oversight is well nigh impossible.

What I find more fascinating, and troubling, than the series of predictable economic decisions made by the corporate managers at BP and Halliburton is the fact that one of the critical mistakes was made by the crew on the drilling rig itself. The crew chose to ignore a series of “negative pressure tests” that strongly indicated that the cement cap was leaking (and subject to blowout), and instead performed a second test using a different procedure, which gave a more favorable result. Given the ambiguous test results, the drilling rig crew chose to rely on the favorable test even though, by doing so, they put their own lives at risk. Good descriptions of the on-site engineers’ decisionmaking process appears in the report issued today (at pages 105 -109, with a critical evaluation at pages 118-119).

This critical error illustrates one of the challenges of any scheme of environmental regulation in the face of scientific uncertainty: the problem of human cognitive bias. Human beings tend to accept evidence that supports their preconceived factual biases, and to reject evidence that conflicts with those biases. This kind of cognitive bias kicks in at the individual level (drill rig engineers who expect that the cement plug was effective and also want to be able to declare the well job finished) as well as at the collective societal level in a democracy where political scientific truth is established by majority vote. What is frightening about the Deepwater Horizon example is how clearly it shows that cognitive bias will overcome risk aversion even when one’s own life is at stake. It demonstrates the huge challenge faced by our society, which requires political consensus to deal with environmental threats like global warming, and for which the evidence perceived by the voting public is ambiguous. Just as the crew of the Deepwater Horizon put their own lives at risk by choosing to believe a less reliable negative pressure test instead of the standard test, we collective seem to be ready to believe that one snowstorm in December is a more reliable refutation of global warming than a year’s worth of temperature data showing 2010 to be one of the warmest years on record globally. Like the crew of the Deepwater Horizon rejecting the danger signals from the pressure tests, we’d rather believe that we are not responsible for global climate change that threatens the patterns of settlement and agriculture that our global civilization depends on.

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