There is good basic information about the oil rig and the events surrounding the blow-out in the Wikipedia article.
The best discussion I've seen of what went wrong and the "fail safe" systems that failed is on the blog site Watts Up With That?:
The rig had apparently just finished cementing steel casing in place at depths exceeding 18,000 ft. The next operation was to suspend the well so that the rig could move to its next drilling location, the idea being that a rig would return to this well later in order to complete the work necessary to bring the well into production.I think the right attitude is like that taken after an aircraft accident. You don't start screaming "stop the planes from flying!". You send out investigators who spend whatever it costs to understand what went wrong, then you issue new regulations and guidelines to make sure it doesn't happen again. Sadly, there are too many people today who think like can be made "safe" and who react hysterically when something goes wrong. You can't cocoon away from risk and accidents.
It is thought that somehow formation fluids – oil /gas – got into the wellbore and were undetected until it was too late to take action. With a floating drilling rig setup, because it moves with the waves, currents, and winds, all of the main pressure control equipment sits on the seabed – the uppermost unmoving point in the well. This pressure control equipment – the Blowout Preventers, or ‘BOP’s” as they’re called, are controlled with redundant systems from the rig. In the event of a serious emergency, there are multiple Panic Buttons to hit, and even fail-safe Deadman systems that should be automatically engaged when something of this proportion breaks out. None of them were aparently activated, suggesting that the blowout was especially swift to escalate at the surface. The flames were visible up to about 35 miles away. Not the glow – the flames. They were 200 – 300 ft high.
All of this will be investigated and it will be some months before all of the particulars are known. For now, it is enough to say that this marvel of modern technology, which had been operating with an excellent safety record, has burned up and sunk taking souls with it.
This is a horrible mess. I have heard that BP didn't put in place all the possible safety and blowout prevention equipment and cut corners. Well, this multi-billion dollar accident will make sure that no other oil company cuts that corner (backed up with regulations with real teeth hopefully). The bottom line is that if you want to live in the 21st century, you need oil. You should be investing like crazy to find alternative energy sources because (1) getting oil will expose you to ever more technology risk, financial risk, and political risk, (2) substitutes are a way to reduce greenhouse gases, and (3) the forces of darkness (the unscientific, NIMBY, hysterical people) only grow in size when something goes wrong.