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Friday, August 4, 2000 - Page updated at 12:00 AM

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New managers at Olympic Pipe Line promise changes

Seattle Times staff reporters

New managers of Olympic Pipe Line announced sweeping changes yesterday while admitting mistakes contributed to last year's deadly rupture in Bellingham.

BP, which assumed control of Olympic last month, said it must reassure the thousands of people who live and work alongside the pipeline that ruptured and killed three people.

The managers pledged to overhaul the operation of a pipeline that has become the leakiest in Washington. And they promised changes at a time when activists nationwide are using the Bellingham spill as a rallying point for better regulation of the industry.

"BP's operating philosophy is pretty clear, and that is `no harm to people and the environment' ," said Bob Batch, Olympic's new president.

"Talk is cheap," said David Beninger, a Seattle attorney representing families of two 10-year-old boys killed in the accident. "Let's see what their actions really provide."

BP said it is firing four workers, reassigning the two who were at the helm when the pipeline ruptured and hiring more managers to oversee the control room.

The London-based company may also conduct costly pressure tests requested by Eastside cities and U.S. Rep. Jay Inslee, D-Bainbridge Island.

It also is expecting to restart closed sections of the pipeline in mid-2001, more than a year later than previous managers had hoped.

And BP said it is installing new equipment that would have caught the repeated valve failures that preceded the June 10, 1999, rupture.

While Olympic was transferring batches of fuel that day, a valve malfunctioned at a new fuel depot near Mount Vernon, causing a pressure wave that raced upstream, according to federal investigators.

The wave burst through the pipe in Whatcom Falls Park, where Bellingham contractors may have scraped the pipe during 1994 excavations.

Olympic was supposed to have monitored the digging, however, and declined to inspect and repair a gouge in the area after it was found during 1996 and 1997 inspections.

The system shut down after the rupture, but controllers restarted pumps, sending more fuel into the broken pipeline before it shut down again automatically.

About 230,000 gallons of gasoline spilled into a creek and exploded in a massive fireball, killing the two boys. An 18-year-old man who was fishing was overcome by fumes and drowned.

"The fact that the pipeline was restarted, I don't think you can say anything but that it was a mistake," said Larry Peck, general manager of BP pipelines in North America. "We are comfortable that a mistake like that wouldn't happen again."

Olympic was previously managed by Equilon, a Houston-based subsidiary of Shell and Texaco that owns 37.5 percent of Olympic.

Other owners were Arco and GATX, a Chicago-based shipping company. BP bought Arco in April, then bought GATX's share of Olympic last month, giving it 62.5 percent ownership of the pipeline.

Reaction to BP's announcements were mixed, but some welcomed the changes.

"I like what I'm hearing. The proof's in the pudding, though," said Whatcom County Fire Commission President Dave Hanson, who fought the June 10 fire.

Hanson said BP has been "much quicker to respond to the questions and concerns" of people in the area.

Based on BP's response to global-warming concerns and other issues, Inslee said he expects the company will "take a little more progressive approach to this, and it's long overdue, frankly."

Bob Rackleff, president of the National Pipeline Reform Coalition in Tallahassee, said there's little difference between BP and other pipeline operators.

"I will believe they're serious about improving it when they start replacing the pipeline that's in the ground," he said. "The thing's old; it's been in the ground 35 years."

BP officials said they believe the pipe will last indefinitely with proper care.

But a management review did find two areas - procedures and training - where Olympic was not up to their standards, company officials said.

A computerized-maintenance system is being installed to track upkeep and performance of every piece of equipment in the pipeline. It will take six to nine months to install.

Federal regulators fined Olympic for improperly maintaining the old system, in part because it failed to correct a valve that repeatedly opened and closed for months before the rupture.

It malfunctioned the day of the rupture, creating the pressure wave that burst the pipe. With the new maintenance system, the valve "would have been fixed and not been a repeated, chronic problem," said Bobby Talley, Olympic's new district manager.

Talley is also training employees to perform multiple tasks and has authorized any of them to shut down the system or call emergency crews if there's a problem.

After an August 1999 spill at its Renton headquarters, Olympic was penalized by the state for failing to immediately notify firefighters. Controllers on duty at the time waited for a supervisor to arrive.

Olympic employs 90 people, up from 72 when BP took over July 1.

Batch, Olympic's new president, who previously was in charge of cleaning spill sites for BP subsidiary Amoco, will be based in Renton starting next month. The previous president of Olympic, Fred Crognale, was based in Houston.

Batch will remain at Renton even if Olympic's control room is moved to Tulsa, Okla., as BP is contemplating. Most of its 15,000 miles of pipeline in 30 states is operated from its Tulsa control center.

BP officials were careful not to talk in detail about past actions that are the subject of legal actions.

But Talley and Peck said they have reassigned two employees in Olympic's computer-control room in Renton to new, unspecified positions. They identified them as Ronald Brentson, a supervisor, and Kevin Dyvig, a computer operator. The company declined to provide details about the four who were fired until the workers were notified today.

Talley and Peck didn't elaborate on the reasons for the reassignments but noted both men have been under a lot of stress since the accident.

Brentson and Dyvig, who made key decisions on the day of the blast, are subjects of a federal criminal investigation into the blast, according to lawyers and others familiar with the matter. Both are being represented by criminal-defense lawyers and have refused to speak to the National Transportation Safety Board, which is investigating the cause of the rupture.

They are the only two of eight control-room employees who are continuing to invoke their Fifth Amendment right against self-incrimination, according to a source familiar with the matter.

Peck said "only a few" employees have not provided information and that about 20 workers have given statements to the NTSB. Some have also testified before a federal grand jury hearing evidence in the criminal investigation, according to court records.

Peck said BP wants the NTSB to get all the information it needs but the company must respect the legal rights of its workers.

Peck didn't comment directly on BP's strategy to deal with the criminal investigation or a wrongful-death suit brought by the families of the two boys. Those matters are "not a BP thing" but an "Olympic thing," he said, seeking to distance BP from the previous operators.

But given that BP has inherited those problems, the company's preference is to settle legal matters before they "wind up in court," Peck said.

Last year, a BP subsidiary, BP Exploration, pleaded guilty to a felony in the dumping of hazardous wastes on Alaska's environmentally sensitive North Slope and agreed to pay $22 million to settle federal criminal and civil claims.

Hundreds of 55-gallon barrels containing paint thinners, paints, oil and solvents were illegally dumped in the mid-1990s by a BP Exploration subcontractor at the company's Endicott Island drilling site on the Beaufort Sea.

BP Exploration pleaded guilty to one count of failing to immediately notify federal authorities of the release of a hazardous substance to the environment. The company expressed regret that the dumping occurred, pledged to make changes and agreed to establish a companywide management system to assure it complies with environmental laws.

On July 25, BP was fined $10 million for air-pollution violations at its U.S. refineries and ordered to spend $500 million to reduce emissions.

Brier Dudley's phone message number is 206-515-5687. His e-mail address is bdudley@seattletimes.com.

--------------------------- Olympic Pipeline's new managers

Bob Batch, president, starts Sept. 5. He has 20 years of industry experience. In addition to managing the pipeline, Batch will work with elected officials, regulators and communities along the pipeline. He previously was president of Amoco Remediation Management Services, in charge of cleaning up Amoco spill sites.

Bobby Talley, vice president and district manager, started July 1 and supervises day-to-day operations, maintenance and control of the pipeline. Previously he was district manager of BP's Southeast Pipeline District in Louisiana.

Jim Clark, health safety and environment manager, started July 1. He has 13 years of experience in "HSE," and was previously with BP's pipeline headquarters in Chicago.

Andres Restrepo, engineering-team leader, started July 1. For most of the past 10 years he worked for BP in Colombia.

Dan Cummings, spokesman, started July 1. He is an attorney and former King County deputy prosecutor.

Copyright (c) 2000 Seattle Times Company, All Rights Reserved.

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