Commercial vessels extinguish a platform fire on board West Delta 32 approximately 20 miles offshore Grand Isle, La., in the Gulf of Mexico, Nov. 16, 2012. Photo: USCG

HOUSTON–Black Elk Energy Offshore Operations LLC, which owns the U.S. Gulf of Mexico platform that suffered a lethal explosion last week, must take immediate steps to improve the safety of its offshore operations, regulators said Wednesday.

The U.S. Bureau of Safety and Environmental Enforcement, which oversees the safety of oil and gas production in federal waters, said it sent a letter to the company requesting specific actions, following a number of violations incurred during the past two years.

“Black Elk has repeatedly failed to operate in a manner that is consistent with federal regulations,” BSEE Director James Watson said in a statement. “This is an appropriate and necessary step as we continue to investigate the explosion and fire that resulted in the tragic loss of life and injuries last week.”

Last Friday, an explosion and fire aboard a shallow water platform operated by Black Elk resulted in one person dead, one person missing, and nine injured. The company said late Tuesday that search efforts for the missing person will be suspended after scouring more than 1,400 square miles of Gulf waters, as well as shore areas.

“We appreciate the perspective of the Bureau of Safety and Environmental Enforcement,” Black Elk said in a statement. “Safety is a high priority for Black Elk Energy and we will continue to work cooperatively with local and national federal agencies to understand exactly what happened with the incident at our platform in the Gulf of Mexico.”

In the letter, BSEE told the company that if Black Elk fails to improve compliance with regulations, the agency could potentially ask fellow regulator Bureau of Ocean Energy Management to revoke Black Elk’s status as operator.

BSEE is asking the company to develop a performance improvement plan, cease “hot work” on its facilities until it can show the agency improvements have been made and a safety manager is in place to oversee the operations, and keep all shut-in facilities down until it can demonstrate safety improvements.

The agency said its move followed several “troubling” safety incidents, including the Nov. 16 explosion, the October issuance of 45 incidents of non-compliance for nine facilities in the U.S. Gulf, and an incident in October 2011 that led to the hospitalization of six workers, among others.

The number of noncompliance reports issued to Black Elk by the agency rose significantly in 2012 to 156 from 99 in 2011. So did the number of BSEE inspections–to 111 from 85– and the number of platforms operated by Black Elk in the area, which went up to 98 from 65, according to the BSEE.

 -By Angel Gonzalez. (c) 2012 Dow Jones & Company, Inc.

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