Wood Group Production Services Network, Fraud & Pollution, Louisiana 2017

Cameron, Louisiana – Oilfield services giant Wood Group Production Services Network (Wood Group PSN) has been slapped with a $9.5 million penalty following a federal investigation into fraudulent safety reporting and a devastating oil spill in the Gulf of Mexico. The company admitted to years of falsifying inspection records and negligence contributing to a 2012 explosion that claimed the lives of three workers.

The Justice Department announced the settlement on February 23, 2017, detailing two separate cases. Wood Group PSN was ordered to pay $7 million for systematically falsifying safety inspection reports for offshore facilities in the Western District of Louisiana between April 2011 and July 2014. The company’s Cameron, Louisiana office struggled with staffing and logistical issues, leading employees at all levels to fabricate inspection data submitted to the Bureau of Safety and Environmental Enforcement (BSEE). A total of 87 violations across multiple offshore platforms were admitted.

The additional $1.8 million penalty stems from a negligent oil discharge into the Gulf of Mexico following an explosion on Black Elk Energy Offshore Operations, L.L.C.’s (BEE) West Delta 32 facility on November 16, 2012. Investigators determined that Wood Group PSN employees, specifically the Person-in-Charge Christopher Srubar, had ceased proper hot work permitting procedures and safety meetings, delegating the critical task to less experienced personnel. This lapse in oversight directly contributed to conditions that ignited hydrocarbon vapors, resulting in a series of explosions, a significant oil spill, and the tragic deaths of Avelino Tajonera, Elroy Corporal, and Jerome Malagapo. Multiple workers were also seriously injured.

According to court documents, construction workers unknowingly cut into sump line piping that hadn’t been properly purged of hydrocarbons before welding commenced. The resulting ignition triggered a chain reaction, blowing oil tanks into the Gulf and destroying platform infrastructure. Federal prosecutors emphasized that Wood Group PSN’s negligence in authorizing hot work and a breakdown in communication were key factors in the disaster. The company admitted its employees were negligent and contributed to the oil discharge.

Beyond the financial penalties, Wood Group PSN was also ordered to pay $700,000 in community service, earmarked for projects benefiting Gulf Coast communities impacted by the incident. The investigation, a collaborative effort between the Department of the Interior’s Office of Inspector General and the Environmental Protection Agency’s Criminal Investigation Division, highlights the critical importance of rigorous safety compliance and truthful reporting within the offshore energy industry.

The fallout from the West Delta 32 incident extends beyond Wood Group PSN. Co-defendants Black Elk Energy and Grand Isle Shipyards face manslaughter charges, while individuals Christopher Srubar, Curtis Dantin, and Don Moss are facing criminal violations of the Clean Water Act. An appeal is currently pending regarding dismissed charges against these individuals. This case serves as a stark warning to energy companies that cutting corners on safety and falsifying records will not be tolerated.

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Key Facts

Defendant: Wood Group Production Services Network
Location: Gulf of Mexico, Louisiana
Year: 2017
Statutes Violated: 33 U.S.C 1319(c)(1)(A) (Clean Water Act), 18 U.S.C. 1001 (False Statements)
Penalties: $7 million for fraudulent reporting, $1.8 million for Clean Water Act violation, $700,000 in community service.
Incident: 2012 explosion on West Delta 32 platform resulting in 3 fatalities and an oil spill.
Cause: Falsified safety inspection reports and negligent hot work permitting procedures.

Source: EPA ECHO Enforcement Case Database

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