Wednesday, October 13, 2010

BP (NYSE:BP), Others, Weren't Inspected Properly by Feds

As anyone knows who has workplace inspections, most of them are announced far in advance, and conditions created to give the appearance of being on top of things. That's what has been the practice of federal inspectors of BP (NYSE:BP) and other companies over the years.

According to an article in the Wall Street Journal, in 2000, about one out of nine federal inspections of deepwater drilling platforms were unannounced. By 2009, only close to one out of eighty were unannounced, basically making them ineffective.

Everyone knows if an inspection is anticipated it will end up with skewed results, as everything is made to look far better than under normal operations of the business on a daily basis.

In other words, when a company knows about it they're being set up to succeed in the inspection. That may sound good, but in reality it is harmful to any company, but in the case of offshore drilling, the stakes are too high to play that game.

Inspections for offshore drilling platforms had also plummeted to only three a year on average, leaving huge gaps of time where any potential damaging practices could go on undetected or unobserved.

The obvious answer is to perform more inspections on a random basis with no one knowing they're going to occur.

After all, why notify an oil platform or oil rig that you're coming? That only does harm, as if there are risky practices going on, they could be discovered and taken care of.

There's no value in giving a free pass to companies in order to get a good grade which otherwise wouldn't have been obtained.

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