Guest Bio: Greg Palast is a BBC investigative reporter and author of Vultures' Picnic. Palast turned his skills to journalism after two decades as a top investigator of corporate fraud. Palast directed the U.S. governmentʼs largest racketeering case in history– winning a $4.3 billion jury award. He also conducted the investigation of fraud charges in the Exxon Valdez grounding.
Paul Jay, Senior Editor, TRNN: Welcome to The Real News Network. I'm Paul Jay in Washington.
The BP gulf oil disaster has been the subject of a lot of examination, and recent examination shows that there's more of a coverup then perhaps we have known. One of the people who's done a lot of work on this is investigative journalist Greg Palast. And he now joins us from New York City. Greg's a BBC investigative reporter, author of Vultures' Picnic, and author of The Best Democracy Money Can Buy and Armed Madhouse and many other pieces of investigative work. Thanks very much for joining us, Greg.
Greg Palast, Journalist and Author: Glad to be with you, Paul.
Jay: So, first of all, what is the—I mean, people know the basic story of what happened, but what is the real essence of the coverup here?
Palast: Yeah, they don't know the real story, not in the U.S. press. For British television, I investigated what really happened. Actually, right after Deepwater Horizon exploded on April 20, 2010, I get a message from a witness, an insider from the Caspian Sea, which is, you know, the other side of the planet, in Asia, saying, I know exactly what happened here, 'cause the exact same thing happened in the Caspian Sea two years earlier: there was another BP rig—another BP rig blew out, just like the Deepwater Horizon. And BP covered it up. BP hid it because it occurred offshore off the nation of Azerbaijan, which is what I call—in my book Vulture's Picnic I call it the Islamic Republic of BP. They own that place. They bought it—bribery.
Jay: Now, the point here is that the cause of the Caspian Sea blowout, you're saying, is essentially the same as what happened in the Gulf.
Palast: Absolutely. Same thing. In other words, what happened in the Caspian Sea is that they used a cheap, crap cement process to close up the well. It's called quick-dry cement. They put nitrogen in the cement—makes it like a milkshake. So it's easy to pour, it dries quickly. But just like any milkshake, if you put a straw in it and blow into it, you get bubbles. But if that happens in an oil well, you get methane and you blow out the rig. That's what happened in the Caspian Sea. That's what happened in the Gulf of Mexico.
And you should understand that in most of the world and most producers would never touch this stuff for a high-pressure place like offshore deepwater drilling. It was insane, it was dangerous, and it was proven to be deadly. And I have to say, I confronted BP with this information. Was there a blowout previously in the Caspian Sea for the same reason? And all they said was, we've reported this fact to the government of Azerbaijan. Hey, thanks a lot. BP itself has said that it was a cement failure that caused the death of the 11 men on the Deepwater Horizon. But they blame Halliburton. They said Halliburton never told us that this quick-dry cement of theirs could fail. In fact, BP knew it failed because it had two years earlier. This was not an accident. This was homicide, negligent homicide.
Jay: Now, you get a call from somebody who witnessed this, is that it? In the Caspian Sea.
Palast: That's correct. So I get a call—well, I don't get a call; I get a cable from the Caspian Sea, from a ship floating offshore, a witness. And, of course, it's very—he said, it's too dangerous for me to speak to you by phone or by official systems. So I have to fly into Asia with my cameraman from British TV and we sneak in. We head off across the desert, a roadless desert, to the BP terminal. And someone has ratted us out, so I get arrested. I get arrested, and they let me go, but they scare off my witnesses, who end up disappearing. So, yes, there was a blowout. But even though the witnesses were scared away, I got their statements—not on camera, but I got the most extraordinary confirmation, which was actually extraordinary and sickening as well.
Jay: So BP has now acknowledged that this happened. But they're not drawing any link between the two things. And what about the American investigation into what happened in the gulf? How did this not come out of that?
Palast: Well, two things. One, BP has never admitted that there was another blowout officially, to me or anyone else. They just said that they reported the incident to the government of Azerbaijan. But here's where we found out what happened. In the WikiLeaks documents—I work with The Guardian in Britain. We have access to the WikiLeaks documents. WikiLeaks documents show a meeting of the president of BP with the United States State Department, U.S. Embassy, because Chevron said, which is a junior partner of BP, hey, where's our money? We're not getting any money from the Caspian Sea. So the State Department called in BP's president, who said, listen, man, there was a blowout, so shh, keep it quiet. So Chevron kept quiet. Exxon kept it quiet—they knew about it too. The U.S. State Department kept it quiet. BP kept quiet. MI6 in Britain, secret service, kept it quiet. They hid it from the U.S. Congress. BP, Chevron, and Exxon all went before the United States Congress and said, we've never had a problem with deepwater drilling, six months before the Deepwater blew up. They didn't mention the year earlier, Caspian Sea.
Jay: So when did this come to light for you? When did you report this for BBC?
Palast: I reported it, ultimately, on British television on the one-year anniversary of the explosion, in April 2011. And I have to tell you—and then I [incompr.] the entire investigation in my latest book, Vultures' Picnic. In fact, if you want, you can go to VulturesPicnic.org and you can see a film of me—there it says "THE FILMS". I had a little—one of those Austin Powers pen cameras, 'cause, right, they take your film out of the cameras, but they didn't take my pen. So I had a pen camera where I still kept the information on there. So you can see me under arrest on this pen camera.
But I put it on TV more than a year ago in Britain. It was all over the top of the nightly news all over the world, all over Europe, everywhere but the United States, where you could not get it on TV. You couldn't get it into the news here for love or money. No way. And, you know, the Petroleum Broadcast System, PBS, was the worst of all. They absolutely refused to take the information. We offered it to them.
Jay: So we're a year later since this story broke. Has there been any change in the American investigation on this? I mean, this is obviously explosive. It means BP lied to Congress.
Palast: Yes, it's explosive. It's criminal. It's criminal in many ways. It's criminal negligence. But it's also that they lied to the U.S. Congress. They lied to—by the way, they lied to the Securities Exchange Commission, because BP filed papers saying—they had to explain why they weren't making any money in the Caspian Sea, and they made up a cockamamie story about some natural gas leakage somewhere. So they lied to the SEC. This is serious stuff. I'm working with Bobby Kennedy, who's the dean of environmental law at Pace University, and Kennedy has said, you know, this is—we have laws against this type of lying, besides people dying. So he's calling on the attorney general of the United States, Eric Holder, to open an investigation. But on the other hand—while on one hand, you know, Holder may be not unhappy about exposing the fact that Condi Rice and the Bush State Department knew about the explosion, I don't know what Obama's State Department also kept hidden in its files, and I'm not sure they want to open that all up.
Jay: Now, you're saying the Bush State Department knew about what happened in Azerbaijan.
Palast: Yes. What happened was, remember, Chevron went to the U.S. State Department and said, we don't know why we're not making money in the Caspian Sea; something happened and BP won't tell us. So the U.S. State Department on behalf of Chevron—not on behalf of the United States, but on behalf of Chevron—went to BP and got the real story. Now, why would they do that? I would just like to remind you that the secretary of state, prior to becoming secretary of state, Condi Rice, was for 12 years on the board of directors of Chevron, and, you know, there's a tanker named the Condoleezza. And so the State Department embassy was basically acting as an investigative arm for Chevron, but hid the material from the U.S. public and the U.S. regulators.
Jay: So this story's been out now for a year. What's the Obama administration done to follow up on this?
Palast: Nothing. And, in fact, what I'm very concerned about is that there won't be a trial, that they're going to cut some type of deal with BP. One of the problems is once you go to trial, not only does this open up, which makes it—I used to be a racketeering investigator for the government, and this is absolutely bog standard racketeering fraud case. And while the co-conspirators involved the Condi Rice State Department, BP, Exxon, Chevron, we just don't know what can of worms is going to open up within the Obama administration. I have no information on what happened inside the Obama administration, and I think they like to keep it that way. I think they'd like to keep a lid on the whole thing.
Jay: Now, is there not a lawsuit where BP is suing Halliburton? And wouldn't this then also come up in some of that civil litigation that's going on?
Palast: Yeah. I mean, one of the—you know, I had expected, actually, to get a call from Halliburton for my information, but we haven't. I think they're not going to go to trial either. BP's blaming Halliburton, saying, you didn't tell us this cement was dangerous. Of course, Halliburton could now turn around and say, well, wait, you knew it was dangerous; you used it in the Caspian Sea and it blew out.
But we do know also that Halliburton, for its part, had run a—. Halliburton, by the way, had no idea what happened in the Caspian Sea. I checked that out. They really didn't know. That was concealed from Halliburton. But we do know that Halliburton had a computer model showing this stuff might fail. So Halliburton has dirty hands, even blood on his hands. So does BP.
So they have reasons to kind of work out their differences. I think you're not going to see a trial between BP and Halliburton. They're not going to open up each other's files and air their dirty laundry, because that's going to stop—if those guys open their files, it's going to stop deepwater drilling worldwide, and both of them will suffer.
Jay: And what do you make of the American media's reaction to this story? Why aren't at least some of them covering it?
Palast: That's why we have you, don't we? If we didn't have The Real News Network—'cause basically they're the unreal news network. I mean, understand, I work with BBC television, Channel 4, ITV. These are the big stature international English language outlets. And, you know, so that's at the top of the nightly news. My story, by the way, also broke at the top of Arte, which is the big giant European network. The question is: why not the U.S.A.? And you're going to have to tell me.
But that's why we actually have The Real News Network, 'cause the unreal news networks just won't take the stuff. They won't touch it. I got to tell you, Frontline, for example, was offered our material, Frontline, PBS. Instead they ran a story that the Deepwater Horizon was caused by a so-called culture of lack of safety at BP, and they said specifically—you'll love this—that if it had been Chevron, this would not have happened, the Deepwater Horizon explosion. They actually had the president of Chevron saying, we wouldn't have done this. But Chevron knew about the Caspian explosion, covered it up. I investigated Chevron. If you go, again, to VulturesPicnic.org or GregPalast.com, you'll get the information from Vultures' Picnic that Chevron, you know, basically poisoned the Amazon Jungle areas, big parts of the Amazon in Ecuador.
So PBS is basically fronting for Chevron. Why? Take a look at Chevron and at the PBS NewsHour home page. You have to go into the WayBack machine, in which you will find out that the number-one official national sponsor of NewsHour and PBS is Chevron oil. So what you're getting is Chevron news, not real news. And the best, that's PBS. I mean, you'll never get this stuff on 60 Minutes. You'll never—you know, they're not going to touch anything that—it's this, literally, explosive (and the pun is intended).
Jay: Thanks very much for joining us, Greg.
Palast: You're very welcome.
Jay: And thank you for joining us on The Real News Network.