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Regulator warns Black Elk on safety after rig fire

By Chris Baltimore

HOUSTON (Reuters) - A regulator on Wednesday ordered Black Elk Energy to take immediate steps to improve safety at its offshore platforms, after last week's deadly rig explosion off the Louisiana coast killed one worker and left another missing.

"Black Elk has repeatedly failed to operate in a manner that is consistent with federal regulations," James Watson, director of the U.S. Bureau of Safety and Environmental Enforcement (BSEE), said in a statement.

In a letter, the offshore regulator said Houston-based Black Elk's performance "must be improved immediately," and gave it until December 15 to submit a plan.

The November 16 explosion and fire occurred when workers were welding a pipe on the deck of West Delta Block 32 platform, which sits in 56 feet of water about 17 miles south of Grand Isle, Louisiana. The incident evoked memories of the deadly 2010 Deepwater Horizon disaster that killed 11 people and triggered the worst oil spill in U.S. history.

Black Elk Chief Executive John Hoffman said in a statement that the company has received the letter and "We will be in full cooperation with all agencies."

The Black Elk explosion did not unleash a major oil spill -- the company told the U.S. Coast Guard that up to 28 gallons of oil in the pipe may have spilled. Oil and gas production at the rig had been shut down since mid-August.

The BSEE's letter cited "troubling safety incidents" at Black Elk, which operates 98 production platforms in the Gulf of Mexico. The agency has logged 156 non-compliance issues in 2012, up from 99 in 2011 and 60 in 2010, according to agency data.

Black Elk has committed "a number of significant safety violations that demonstrate a disregard for the safety of personnel," BSEE's letter said.

Those include an October 2011 incident where use of an acid-based chemical hospitalized six rig workers at its High Island 571A well off the Texas coast.

(Additional reporting by Kristen Hays; Editing by Marguerita Choy)

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