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Transcript: BP's Managing Director on 'FNS'

The following is a rush transcript of the May 30, 2010, edition of "Fox News Sunday With Chris Wallace." This copy may not be in its final form and may be updated.

CHRIS WALLACE, ANCHOR: Joining us now from Houston, the managing director of B.P., Bob Dudley.

And, Mr. Dudley, now that B.P. has determined that "top kill" won't work, and we can see there live on the B.P. spill cam that oil is once again surging out of the well, what will you do next, and when?

BOB DUDLEY, B.P. MANAGING DIRECTOR: Chris, that's right. We're all disappointed that the "top kill" operation didn't work. We failed to wrestle this beast to the ground. We're immediately moving equipment that we had in place as the next step, which is to put a — something called a lower marine riser package cap on the top of the well that will produce the majority of the fluids through the well up to a vessel at the surface.

WALLACE: This is a version of the containment dome that you used last time. Why do you think it will work now when it failed to work last time?

And also, as I understand it, one of the things you're going to do is you're going to cut the pipe in order to put this cap on top of it. Isn't there a serious risk that when you cut that pipe you could actually make the leak even worse?

DUDLEY: To your second question first, the — what we need is a clean cut across the top of that riser package at the bottom of the sea. The amount of oil will not change. The oil was coming out anyway from just above it at a — at a broken area of the pipe at the end of the pipe. So that is not going to change the flow.

This containment dome — we learned a lot from the last one. There's something called gas hydrates, which ice it up and tended to make it to float. This time we're going to pump warm sea water down the column of the pipe to keep the oil and gas warmer. And that should prevent the same kind of problems we had on the first attempt.

WALLACE: Well, let me ask you, there was talk from B.P. before that "top kill" had a 60 to 70 percent chance of success. Obviously, it failed. Do you want to put a percentage on the chance that this is going to succeed?

DUDLEY: There is no certainty, but we feel like the percentages are better that we'll be able to contain the oil. The question is how much of the oil we'll be able to contain, and the objective is to try to collect the majority of it through this vessel.

WALLACE: The U.S. Geological Survey now says that the flow of oil from that spill is two to four times greater than B.P. originally stated, and that there has now been something between 17 and 39 million gallons that have spilled into the gulf. Do you accept those bigger figures?

DUDLEY: Chris, those figures were never a B.P. figure. They were a joint figure with the Unified Command Center down there working with Coast Guard and NOAA and others. They were based on satellite estimates.

We look at the flow rates and we've never been able to measure them precisely. One of the things that will happen with this LMRP cap containment program is we'll get a better idea of the rates from the well with real physical samples, which have been extremely difficult to do on the sub-sea.

WALLACE: But do you accept the fact that it is, in fact, two to four times greater, the flow of oil, than had originally been stated?

DUDLEY: Well, there's a wide range on that, and I think — I think for everybody, including the government agencies — we're looking forward to being able to measure this flow out of this containment device, and then we'll know.

We managed the spill response itself for much, much higher rates of flow rate. And that's what — I think that is why, although it's terribly unfortunate, we've seen some of that oil get through on the beaches of Louisiana.

For the most part, the spill response has maintained this oil off the shores of Mississippi, Alabama and Florida.

WALLACE: Well, let me ask you about that, if I can, sir, because we're now told that the spill has stretched across 150 miles of the gulf coastline. As it continues to spread, and it's going to be several more days now, we know, at the full rate, does B.P. have any more — any new plans on how to protect the shoreline?

DUDLEY: Well, we're working with the Coast Guard, and we're treating this really as a defense of the United States there. The 3 million feet of boom that have stretched out, constantly re- prioritizing, and for where we see the oil and moving it around — this is almost an operation led with the oversight of the Coast Guard that is almost military now.

The beaches in Louisiana — there are three beaches where there's oil. There's 800 people out there every day cleaning these beaches up. This is the highest focus. The skimming — the weather has been good. The skimming and collecting off the surface seems to be very successful now. There's a large sheen out there, but not that black oil that you see earlier in the spill.

WALLACE: Mr. Dudley, we've got a couple of minutes left and I want to get to two subjects with you. Over the last decade I think it's fair to say that B.P. has had a poor safety record.

In fact, just over the last three years, according to OSHA, the government's workplace safety agency, B.P. had 760 what are called "egregious, willful safety violations." Two other oil companies were next with just eight. How do you explain that, sir?

DUDLEY: Well, this primarily goes back to an incident that we had in Texas about a half a decade ago with a tragedy and explosion of a refinery in Houston. And then we've had an issue in Alaska as well. Most of those violations you report are related to those incidences.

In the last three years, the chief executive of the company, Tony Hayward, has brought in a program top to bottom where we focus on safe and reliable operations, ingrained it in the — in the culture of the company. We're going to see...

WALLACE: Well, obviously — forgive me...

DUDLEY: ... the effects of those...

(CROSSTALK)

WALLACE: ... forgive me, Mr. Dudley. That hasn't worked too well, has it?

DUDLEY: We've had this accident in the gulf which we're taking full responsibility for. We're not blaming anyone yet for it. The investigation of this will determine the causes.

What's happened out in the gulf today is something that is an industry issue to understand this failsafe use of equipment. It's going to have implications for the drilling industry not in the U.S. only, but all around the world. Everyone's going to step back and learn from this and...

WALLACE: Well, but let me...

(CROSSTALK)

WALLACE: But I have to ask you, sir — and as I said, we have less than a minute left — there have been a number of reports this week that B.P. took shortcuts on this specific well. Let me put them up on the screen.

B.P. reportedly chose to use a cheaper casing for the well that the company knew was riskier, and your company reportedly used salt water instead of heavy drilling fluid, which would have done more to contain pressure from the well.

Question: Did B.P. cut any corners on the Deepwater Horizon oil rig?

DUDLEY: Chris, I don't believe they did. The casing designs on that well are similar to designs on rigs and wells used all across the gulf.

The decisions that were made in the final hours of — on the rig of decisions to control the well is something that the investigations are going to have to go through in great detail. That's a combination of B.P. and the — and the rig contractors that made those decisions.

Any statement or conclusion before those investigations are out are very premature.

WALLACE: Mr. Dudley, we want to thank you so much for coming in and bringing us up to date, sir. And I think all of America wishes you good luck on plugging the hole.

DUDLEY: Thank you, Chris.

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