Laura: This is Laura Pennino. I'm here for the BusinessMakers show, heard here and seen online. With me today is our guest, Loren Steffy who's an award-winning journalist and a columnist for the Houston Chronicle. He has authored the wonderful book Drowning in Oil, BP's Reckless Pursuit of Profit. Loren, thank you so much for being here today. We're very pleased to have you.

Loren: Thank you. Glad to be here.

Laura: When you read the book it just seems so much like you were there. Like you were there when the wellhead blew. Can you explain to use how you got into that being there mode?

Loren: Yeah, I wasn't actually there so let me make that clear. But no, I think that one of the advantages that I had in writing this book was that unlike so many of these sort of large disasters, there was a tremendous amount of public testimony that was already available when I decided to write the book. We'd had the ongoing Coast Guard hearings over the summer and whatnot. Really in reading some of those testimonies it just kind of jumped out at me that there was this incredible narrative.

And one of the really unusual things about the Deep Water Horizon accident is that the witness accounts really line up remarkably well. You can hear one person's testimony about what they did and they meet so-and-so in the hallway. And then you read so-and-so's testimony and sure enough, I mean they're very interwoven. And that's very unusual in this sort of situation and so that kind of gave me the basis. I knew once I read those, hey. These guys have really, you know, it was remarkable how well people remembered little details about the accident. And that really kind of got me going on building the narrative.

Laura: And I suspect they were united in the trauma of the experience, right?

Loren: Absolutely, yeah.

Laura: What story really struck you most at the heart?

Loren: You know there were a number of them that really kind of were very moving. And each one of theses guys had, you know, many of them had young families. I think Steven Stone's story where he was - you know the explosion happened. He started to leave and he went running back to pick up his wedding ring. He'd been married for six months. And I thought that was just very moving and I'm sure his wife probably loves to hear that story told, but that was the kind of thing that really I think brought out the humanity of these guys that everybody on that rig was very afraid for their lives.

And you kind of have these thoughts that are going through your head and you wonder what would you do in that situation? You know I've asked myself a million times. If I thought I was about to be caught up in this big explosion, would I remember to go back and grab my wedding ring? And in actuality I don't usually take it off, but you know you kind of wonder about that sort of thing. And so I think that was very moving.

And the other story that I found myself surprisingly moved by was actually John Brown's story, kind of the personal story. We knew by the time I started working on this book that Brown was a homosexual, but I hadn't read his biography or his autobiography until I began researching this book. And I was very struck by the stories early on about his difficulty fitting in in the oil business and how he kind of repressed a lot of his feelings and whatnot and really kept a lot of his sexual orientation hidden because it was a very difficult time. It would have been virtually impossible for him to rise to the top of the company if he had come out as it were at the beginning of his career. And so I was surprised at how moved I was by some of his recounting of events around that issue.

Laura: When readers go to this book, what is the main message you want people to take away from reading this book? I mean aside from people learning those personal stories not only and I do want to add not only of the BP Gulf disaster but the Texas City issues, too, but I mean what do you want people to learn from all this?

Loren: I think the bottom line is complacency kills. And that's what these companies need to remember. It's what workers need to remember every day when they go into - yes, these are dangerous jobs. We all know they're dangerous. The workers know they're dangerous, but they don't need to be as Dave Lining, who was one of the Texas City survivors said, "They're dangerous jobs but they don't have to be hazardous jobs."

BP really didn't understand the difference between those two. It really requires a vigilance. One of the things I hear a lot from people in the offshore oil industry is well, we drilled 60,000 wells without having a problem like this. That very statement speaks to one of the problems that the industry has to overcome. You can't rely on that track record, especially not when you're at the cutting edge of the technology. I mean there haven't been anywhere near 60,000. There haven't been 100 of these deep-water wells drilled in over 5,000 feet. So we're really kind of in a new technological era and that requires even more vigilant.

Laura: One quick thing, too- I mean you feel very strongly about this catastrophe and going into this recklessness. I mean I want to talk a little bit about that. What would you say is the culture now of BP versus the culture then?

Loren: Well, honestly I don't know what the culture of BP is now. I think that BP's new CEO, Bob Dudley, has talked a lot about changing the culture and he's implemented a number of steps that he believes will change the culture. And yet when I listen to what he's saying and I see what he's doing, I'm reminded very much of Tony Hayward in the early days of his tenure. He too said many of the same things and did many of the same things.

And actually Tony had some success in changing the culture of the refining business after Texas City. But he never believed that the problems that existed in the refining industry and refining business or the pipeline business would extend to the exploration business. Okay, not the crown jewel of the company, not the division that he had overseen. So it became kind of a blind spot and I think it's very, very difficult to change the culture of a company BP's size. And I'm not sure that a guy who has been a part of that culture for 20 years or more as Bob Dudley has really is going to set the tone that needs to be set.

Laura: Yeah, almost like a fresh face and voice need to be there.

Loren: BP has been very reluctant to bring in outsiders to address these problems and I think that now more than ever that's probably needed.

Laura: We'll be back with more from Loren Steffy after this. You're listening to the BusinessMakers show heard here and seen online at theBusinessMakers.com.

Laura: This is the BusinessMakers show heard here and seen online at theBusinessMakers.com. Continuing on with Loren Steffy, business columnist for the Houston Chronicle and author of Drowning in Oil. Loren, we were talking a little bit earlier about deep water drilling and the fact that only about 100 super deep wells have been completed.

Loren: Yeah, it's, actually the term is ultra deep.

Laura: Ultra deep.

Loren: And it's actually fewer than a hundred. I mean that was sort of a rough approximation, but it's actually, you know, compared to the number of wells that have been drilled overall in the Gulf, it's a sliver. And these are, when we say ultra deep we mean wells that are drilled in 5,000 feet of water or more. So you're really pushing the technology envelope. And what we saw if you remember in the response to the Deep Water Horizon disaster, the spill itself -

Laura: Right, which was what, 4.9 million?

Loren: 4.9 million barrels of oil total that spewed out over the course of the summer. And one of the reasons it took so long to cap this thing was that containment technology that worked in other places didn't work in this case because we were dealing with these extreme depths. So if you remember the top hat, which was the first thing they tried to lower over it, well it froze up. You got the nitrates that froze on the inside of it. That's again because of the depth, okay?

That particular response worked perfectly well in the Gulf of Mexico in 1979 with the Ixtax spill. I think there they call it the sombrero because it was in Mexican waters, but anyway the point is it was the exact same technology and it worked very well. It didn't work here because of the depth. You know you're dealing with extreme pressures.

Laura: And this was 10,000 feet, right?

Loren: This was 5,000 feet of water.

Laura: Right, but -

Loren: And then another 13,000 feet of drilling below that, so 18,000 feet all together, thereabouts. And you know this is kind of the industry is sort of bristle sometimes when you compare it to a moonshot, but it's the oil industry's equivalent of the moonshot. I mean it's that kind of technology and I think one of the things that the industry has done well in responding to this disaster has been to set up a containment response program that ought to be better able to deal with a spill of this type should it ever happen again, God forbid.

Laura: You bring up a few points that I want to get to. One was, and we didn't really talk about this before, but just that whole disaster-planning scenario, right? And that supposedly there were all these different checks and balances in place and that there would never be a disaster of this magnitude, right?

Loren: Yeah, it really gets to the complacency issue that I mentioned earlier. Every well was supposed to have its own environmental impact study, but what we found was, what Congress found was that basically the company has used the same one for every well and not just every well in the Gulf, but every well. And so you had the response plans in the Gulf of Mexico talking about protecting the walruses and things like that. And this became the butt of many jokes including my own, but the fact is that it really spoke to not just an industry complacency, but also the government's complacency in overseeing this.

The government didn't have the staff to actually review these plans or to scrutinize what the companies were filing. And so there was really kind of a total breakdown in terms of the safety net if you will in the terms of making sure that we had the programs in place for being able to deal with this kind of spill. It became almost the unthinkable for the oil industry that there would ever be a disaster of this magnitude. Just really nobody believed that it would happen including by the way President Obama who said a month before this happened that offshore drilling is surprisingly safe and we should -

Laura: Right, I remember that.

Loren: -- open up these new areas to drilling. So everybody believed that this was beyond the realm of possibility.

Laura: You brought up a good point, too about safety and the projections and the estimates, too, or we talked about that. And you said earlier that 60,000 wells have been drilled with virtually little incident. Let's talk a little bit about the other companies that have been doing well and to a certain extent many of them were penalized, right, with the offshore drilling moratorium. So talk about what you see in some of these other companies and why they have adopted better safety measures or good safety measures.

Loren: Well, you know it's interesting. One of the things that I found rather surprising as I worked on the book was how much of an outlier BP was in the industry. How unpopular I guess you'd say they were with other oil companies in part because of this culture, this reputation they had for cutting corners. And if you remember when we had the congressional hearings last summer, you had all the other CEOs of oil companies saying we would not have drilled the well this way.

Laura: Right, right.

Loren: That's to my knowledge never happened in the history of this business. The response has always been what's bad for one oil company is bad for everyone and they all kind of close ranks and stick up for each other. This was the first time you've seen them throw sort of one of their own under the bus if you will. And I think that if it had happened to a different company the response might have been different.

But you have had a real disparity in terms of the safety issues and the safety history with some of these other companies. And one of the things that I was sort of glad to see was in the president spill commission report they held up Exxon Mobil as being sort of the gold standard for how to do this right. That's not a mistake. The response to the Exxon Valdez, or the aftermath of the Exxon Valdez disaster fundamentally changed the culture of that company and they made it very clear from the top down safety was paramount.

And so somebody told me within Exxon financial performance matters. Exxon's a financial machine, but the thing that will get you fired the fastest is if you don't take safety seriously. That kind of mandate was not present at BP and so I think there's a reason that it happened on their watch as opposed to Exxon's.

Laura: So that goes into the reckless pursuit of profit, right, that you were talking about?

Loren: Yeah.

Laura: And you're not saying that profit's bad, right?

Loren: Profit is essential. Companies exist to make money. I'm not arguing with the profit mode at all. But when you look at, and really the book takes a look at about a ten year history from the time of the mergers with Amoco and Arco, going forward. And you look at all of these operating failures that BP had, all of these safety lapses. And the thing that is so frustrating to me is that as I worked through these and you read the responses to these or you read the results of these investigations, they're all saying the same thing.

You know there was a report issued in 2003 that was an investigation of there was a series of mishaps at the Grange Mouth, Scotland refinery. And that report cited BP's short-term profit views as being a cause of the safety problems there. It was the same thing they said after Texas City and it is much the same thing we're hearing coming out of the Deep Water Horizon. So it's the same message and yet nothing has changed.

Laura: And I'm curious to know. I mean were you able to get at any even theoretical answer as what will it take to actually change?

Loren: You know that's a really good question. What it will take to actually change I don't know. I would like to hope that this would be enough of a wake up call that they will follow through on some of these things, but you know it's a tough track record. And again to try to change that when you have the same people in place I think is very difficult.

But the overall cause and what happened was BP was the kind of culture in which people respond to incentives and the incentives within BP were always on the short-term financial performance. That's what John Brown wanted. That was the tone that he set. That was the measure of BP success and it was carried over with Tony Hayward.

You know it could very well be carried over with Bob Dudley. So until they change that - now in fairness Dudley has said that he wants some of the incentives to be tied to safety performance. Will that be enough? I don't know. It depends on how closely the message is reinforced.

You know it was interesting. I was out on a rig last summer and this was a company that had nothing to do with any of this, but they made the point that when they do their quarterly analyst calls, the CEO gets on the call and the first thing he does is he gives a safety message. He talks about safety. And they said you know the analysts don't care about that, but he knows that employees listen to the call. And he wants to make it clear that this is the most important thing. It's the first words out of his mouth when he starts talking about financial performance. That's the kind of response you have to have within BP and we haven't see that yet.

Laura: Now to that point, since there's a lot left to be said and the book was written back in the fall, right? And it came out around December, is that right?

Loren: Yes, early December.

Laura: Early December. A lot more has come out. More lawsuits have been filed, more reports, results of investigations. What would you like to do? Would you like to do an addendum to the book? Would you like to publish more chapters that have not been out there? What are the plans?

Loren: Yeah, I mean it was funny because as I was working on the book the goal was to be the first one out, right? And so we sort of won on that. We were the first major publisher to come out with a book, but now I'm kind of wishing that I had had more time because there's so much more that has come out and so much more I'd like to write about. So I don't know what will happen.

We're having some preliminary discussions about maybe doing a paperback that would be like an expanded edition kind of thing. That would obviously be a lot more work on my part, but I'd love to see it. I mean the book has gotten a good response. I've been very pleased, but I feel like the story was as complete as I could make it.

My deadline was, mid-October I believe was my copy deadline for the book. And we didn't have any of the - the only investigation that had been completed at that point was BP's internal one. So we didn't have any of the independent investigations. And I'd love to be able to kind of bring that story forward.

And really up through this past year where I've just spent a week in southern Louisiana talking to people about the fallout and the drilling moratorium and the economic impact of that which has had a huge and devastating effect on the economy of southern Louisiana, so. Yes, there's a lot more to be written and I'd love to be able to finish it.

Laura: Do you have the book available at Amazon.com -

Loren: Absolutely, absolutely.

Laura: -- and Barnes and Noble, right?

Loren: Yes.

Laura: And in certain bookstores?

Loren: In most, in all major bookstores.

Laura: All major bookstores now?

Loren: Wherever fine books are sold.

Laura: Okay, wherever fine books are sold. And Loren, you've accomplished so much in your career and I mean kudos to you for winning awards and being a speaker on many panels. You've been on national and regional television and radio shows. I'm sure many young journalists are looking up at you and saying hey, I'd like to be like that guy. But what advice would you have? What are some things that you would say these young people need to be doing to pursue a career in journalism?

Loren: One of the things I always tell people is something a journalism professor told me. And that is that journalists should experience all they can. And I think that now we have sort of this internet culture. The first thing we do is we Google something when we want to know about it. And I think you can't overstate the importance of getting out, meeting people, seeing things for yourself, going to where the news is happening and getting that kind of first-hand reporting.

Terribly important whether you're doing it online, whether you're doing it for print. Who knows how much longer we'll be doing it for print, but I think the rules of journalism are the same no matter what the platform is. And I think what we need in online journalism, which is where most of today's journalism students are going to end up, we need more real reporting. We need less regurgitation, less linking to other people's work and more unique reporting. So I think those young journalists who learn how to bring compelling stories to the internet audience are going to be the ones that really succeed.

Laura: Thank you, Loren for being here with us today. You've been listening to the BusinessMakers show heard here and seen online at theBusinessMakers.com.