BP, Oil Interests Brace for Capitol ‘Perp Walk’

Posted May 7, 2010 at 5:10pm

Earlier this year Toyota’s top brass received a tongue-lashing on Capitol Hill for their company’s automobile defects. More recently lawmakers grilled Goldman Sachs executives about questionable financial transactions.

This week it is BP’s turn.

The oil company and its business partners will take the hot seat and face interrogation by Congressional committees over the devastating Gulf of Mexico oil spill.

“This is the new version of the perp walk,” said John Feehery, a former GOP Congressional spokesman who heads the Feehery Group, which specializes in communications and government relations.

The hearings, which begin Tuesday, only add to the challenges faced by BP and its contractors, who have been struggling to stop the massive leak and limit the environmental damage.

The oil giant can lean on a substantial Washington lobbying team and a politically connected public relations firm to prepare for the face-off.

But experts say company officials still must do a better job of humanizing their situation as well as bracing themselves for what are sure to be stern reprimands from lawmakers.

“If we were training BP we would want them to be looking carefully at the Goldman Sachs video and the Toyota videos to prepare them for the questions they will receive and the lectures they will have to endure,” said Gene Grabowski, senior vice president of Levick Strategic Communications.

Grabowski, who chairs his firm’s crisis and litigation practice, said he would advise BP to bring some of its rank-and-file workers to Washington to help the company make its case.

“I don’t think BP has done as good a job as it needs to to put a human face on this crisis,” he said.

Neither BP nor Transocean responded to inquiries about their legislative efforts related to the spill.

Regardless of who accompanies them, the top executives will be the center of attention as they make their way through the Congressional gauntlet, beginning with a Senate Energy and Natural Resources Committee hearing at 10 a.m. Tuesday in the Russell Senate Office Building.

The witness list includes Lamar McKay, president and chairman of Houston-based BP America, and Steven Newman, president and CEO of Transocean, the oil rig owner which is also headquartered in Houston. Also testifying will be Tim Probert, Halliburton’s president of global business lines and chief health safety and environmental officer. Halliburton was the cement contractor involved with the blown-out well.

Later that day the executives will walk next door to the Dirksen Senate Office Building to appear before the Senate Environment and Public Works Committee. On Wednesday, the House Energy and Commerce Subcommittee on Oversight and Investigations is scheduled to take up the oil spill matter.

BP has tapped a high-powered public relations firm, Brunswick Group, which like the oil company is based in London. Brunswick also has strong connections in Washington, where its managing partner is Hilary Rosen, a former Democratic aide on Capitol Hill who previously ran the Recording Industry Association of America.

Others affected by the oil spill are also seeking professional communications advice. Commercial fishermen and environmental groups have hired the Washington-based public relations firm run by Peter Mirijanian, who declined to comment about his clients.

Feehery said BP experienced some initial “hiccups” when it tried to shift the blame for the spill to Transocean. But he said the company appeared to have recovered and had been trying to touch all bases on Capitol Hill. Amos Snead, a principal in Story Partners, praised the company’s use of social media but said it needs to do more “micro-targeting,” making sure its message reaches constituencies in affected states.

Kevin Madden, a former GOP aide who is now executive vice president of Jim Dyke & Associates, said that while the executives need to explain their story to the committees, they will have to understand that “lawmakers are going to want to get their licks in.” He said the executives should not “come in with an inflated sense of fairness.”

But Bill Wicker, spokesman for Energy and Natural Resources Chairman Jeff Bingaman (D-N.M.), suggested there would not be many fireworks at his hearing.

“If you are looking for good theater and a lot of huffing and puffing, our committee doesn’t roll that way,” he said. “Both my boss and our ranking Republican are taking a serious earnest look at this accident.” The committee’s ranking member, Lisa Murkowski (R-Alaska), whose state is a major oil producer, said last week that now is not the time to beat up on BP and that officials should focus on the cleanup.

But the afternoon session before the Environment and Public Works Committee is likely to be more lively. The panel’s liberal chairman, Sen. Barbara Boxer (D-Calif.), has a reputation for sharp questioning of witnesses. In addition, one committee member, Sen. Frank Lautenberg (D-N.J.), who has advocated raising the financial liability limits for oil companies, issued a press release Friday noting that he planned to question the executives at the hearing.

On the other hand, Environment and Public Works ranking member James Inhofe (R-Okla.) has often clashed with Boxer on environmental issues.

Lawmakers’ probes of the spill, though, are not limited to Congressional hearing rooms. Over the weekend, some Members got an eyewitness review of the situation.

Two Congressional delegations traveled to the Gulf on Friday to fly over the oil spill. Rep. Ed Markey (D-Mass.) led one trip of Energy and Commerce Committee members.

Transportation and Infrastructure Chairman James Oberstar (D-Minn.) led a previously planned bipartisan and bicameral delegation to New Orleans for the annual meeting of a U.S.-Canada interparliamentary organization. Oberstar amended the itinerary of the trip to include a flyover of the oil spill Friday.

Back inside the Beltway, some experts observed that it seems early for Congress to be holding hearings, particularly since company officials are being forced to take time away from dealing with the ongoing crisis to answer lawmakers’ questions.

But Frank Maisano, an energy specialist at Bracewell & Giuliani, said executives at BP and the other outfits had no choice but to travel to Washington to demonstrate they grasped the severity of the situation.

“This is not just a little oil spill,” he said. “They have to convey a level of seriousness by having their leadership available to talk about this.”

Paul Singer contributed to this report.