This piece from the LA Times gives much more detail:
Foreign flagging of offshore rigs skirts U.S. safety rules
The Marshall Islands, not the U.S., had the main responsibility for safety inspections on the Deepwater Horizon.
June 14, 2010|By Tom Hamburger and Kim Geiger, Tribune Washington Bureau
Reporting from Washington — The Deepwater Horizon oil rig that exploded in the Gulf of Mexico was built in South Korea. It was operated by a Swiss company under contract to a British oil firm. Primary responsibility for safety and other inspections rested not with the U.S. government but with the Republic of the Marshall Islands — a tiny, impoverished nation in the Pacific Ocean.
And the Marshall Islands, a maze of tiny atolls, many smaller than the ill-fated oil rig, outsourced many of its responsibilities to private companies.
Now, as the government tries to figure out what went wrong in the worst environmental catastrophe in U.S. history, this international patchwork of divided authority and sometimes conflicting priorities is emerging as a crucial underlying factor in the explosion of the rig.
Under International law, offshore oil rigs like the Deepwater Horizon are treated as ships, and companies are allowed to "register" them in unlikely places such as the Marshall Islands, Panama and Liberia — reducing the U.S. government's role in inspecting and enforcing safety and other standards.
"Today, these oil rigs can operate under different, very minimal standards of inspection established by international maritime treaties," said Rep. James L. Oberstar (D-Minn.), chairman of the House Transportation Committee.
Some offshore drilling experts, as well as some survivors of the explosion that led to the massive spill, say foreign registration also permitted a confusing command structure and understaffing — factors that may have contributed to the disaster.
Senior members of Congress — including Oberstar and House Natural Resources Committee Chairman Nick J. Rahall II (D-W.Va.) — have begun looking into the inspection and staffing issues. The House Subcommittee on Coast Guard and Maritime Transportation will hold a hearing Thursday on foreign-flagged rigs in the Gulf of Mexico.
Different types of rigs are classified differently, and the Marshall Islands assigned the Deepwater Horizon to a category that permitted lower staffing levels.
"Over the years, the manning dwindled down and down," said Douglas Harold Brown, chief mechanic aboard the Deepwater Horizon, who had been assigned to the floating drilling rig since shortly after it was manufactured in 2000. "I believe that safety was compromised by this," he said in an interview.
Brown's lawyer and others say the Marshall Islands licensed the Deepwater Horizon in a way that allowed rig operator Transocean Ltd. to place an oil drilling expert — the so-called offshore installation manager — ahead of a licensed sea captain in making decisions on the day of the explosion.
The dual command structure created confusion that delayed an effective response to the growing crisis aboard the Deepwater Horizon, he and others allege.
Officials at Transocean and the Marshall Islands reject the claims. They say they fulfilled all requirements of the law and met the highest industry standards, and those of the Coast Guard.
Brian Kennedy, a spokesman for Transocean, called the complaints "egregiously unfounded and inflammatory." The disorganization reported by crew members who survived the Deepwater Horizon explosion was the result of a tragic and unexpected disaster, not deficiencies in manning or safety standards on the part of Transocean, Kennedy said.
"At the end of the day, I think the fact that 115 people got off the rig that night will be viewed as a testament to the training, skill and heroic acts of dozens of crew members," he said.
The Marshall Islands deputy maritime minister, Thomas Heinan, said the manning requirements aboard the Deepwater Horizon were "equal to those of the U.S. and in accordance with international standards."
A deepwater oil rig floats above the well, connected by thousands of feet of pipe, and is kept in position by thrusters and elaborate navigational systems.
Since World War II, thousands of ships and rigs from the U.S. and other industrialized countries have been registered in less-developed nations like the Marshall Islands.
Some members of Congress are expressing concern about the Marshall Islands and other countries that outsource their inspection responsibilities to private companies. Coast Guard officials confirm that more rigorous inspection procedures apply to the relatively small number of rigs registered in the U.S.
A foreign vessel will be reviewed by the Coast Guard, but the inspection is relatively cursory, relying on inspection reports prepared by outside firms that have been paid directly by the owners of the vessel.
The federal Minerals Management Service, which also has a role in overseeing offshore oil operations, deals only with issues "below the waterline" of the floating rig. It was not responsible for rig staffing, command structure or other above-water operations.
John Konrad, a licensed captain who publishes a maritime blog and is consulting with survivors, said oil rigs should be under the command of licensed sea captains.
"On the Deepwater Horizon you had the guy who does the drilling plans able to make the call on safety," Konrad said.
Such dual command structures would not be accepted for U.S.-flagged operations, experts say.
The Deepwater Horizon captain testified to investigators last month that he conferred with the drilling manager before he attempted to disconnect the rig. By the time a crew member decided on his own to push the emergency disconnect, it was too late.
Kennedy, the spokesman for Transocean, said, "Having two complementary positions that reflect the dual functionality of the rig, as the Horizon did, provides a clear but collaborative chain of command that has been employed by the industry for decades."
But Steven Gordon, a maritime lawyer in Houston representing Brown, six other survivors and the family of one of the 11 workers killed in the blast, said, "This course of action cost men their lives."
"It led to a jumble of disorganization on the Deepwater Horizon at the moment when organization was needed the most," he said.