Wednesday, December 12, 2012

Spill It and We Will Come

I usually post light hearted, fun things on my blog.  However .... for the past several weeks I have been seeing a re-occuring commercial on various TV channels.  It is the commercial run by British Petroleum that tells viewers how wonderful the Gulf Coast is now and how BP has paid so much money to, well, gee, by golly, shucks you all, just help out the good people of the Gulf Coast. 

Every time I see that commercial begin, I switch the channel or shut off the TV.

BP is an excessively large multi-national company.  It would take way too much space and effort to even begin to explain how huge this company is or how much money it makes.  Any company big enough to buy out AMOCO must be beyond big.  (Okay - it merged with AMOCO and then adopted the BP name instead of British Petroleum, but let's not get into details.)

The fact of the matter is that on April 20, 2010, the Deep Horizon oil rig exploded about 40 miles off the Louisana coast.  Eleven people were killed.  Many were injured.  The loss of life and personal injuries were tragic.  Yet more tragedy was about to come.

The oil rig was about 400 feet by 250 feet in size.  It had been built in South Korea and was owned by a company called Transocean which is a large corporation with operations all over the world.

The rig was actually owned by a Swiss company called Triton Asset Leasing but that company was owned by Transocean.  The rig flew a Marshall Islands flag and was leased to British Petroleum (BP).

Are you sort of getting the idea of how really big multi national corporations work?  Layer upon layer upon layer ....

When the rig exploded it sank.  And within two days of the explosion, the Coast Guard reported the oil rig was leaking oil into the ocean water.

The oil leak continued for 85 days and was not stopped until July 15.  About 5 MILLION barrels of oil were released into the water.  To put things in perspective, the Exxon Valdez oil spill totaled 750,000 barrels.  (That Alaskan spill - 15% the size of the BP Gulf Oil spill - was not resolved for 13 years and not until the U.S. Supreme Court got involved.)

One barrel of oil equals about 42 gallons.  If my math is right, 5 MILLION barrels equals 210 MILLION gallons.  During the 85 days the oil leaked, that works out to about 53,000 barrels every day or over 2 MILLION gallons of oil per day.  That is ... a lot of oil.

This past month (November, 2012) BP agreed to pay $4.5 BILLION as part of a deal that resolved its corporate criminal liability to the United States.  Of that amount, $1.5 BILLION was a criminal fine for the oil spill and about $2.5 BILLION is being paid to the National Fish and Wildlife Foundation.

This is the largest criminal fine in history.  (As I write this it appears HSBC Bank is being fined $1.9 billion for money laundering ... but the total overall payments or fines to the United States government paid by BP for the oil spill will be greater overall.)  The company plead guilty to 13 charges related to the spill itself and one charge of lying to Congress.

Again, it would take too much time and space to provide a fuller explanation of all of this.  Suffice it to say the whole business is very sad and extremely serious.

Granted, BP is a major corporation and you have to be huge to carry on petroleum operations.  And, yes, BP did take responsibility for the spill and has appeared to work to get things resolved.  It makes you wonder if BP is doing this to minimize the damage (cut its losses). 

Certainly, there is no question a lot of good people work for BP and that intentions are good - but keep in mind that a corporation can be banned from doing business in our country as part of an overall criminal sanction.  It is in BP's self interest to put as good of a face on all this as possible and be cooperative.

In criminal cases you never really know if a person is sorry for what they did or more sorry it got caught.  BP has maintained all this was an unfortunate accident but a review of BP's record indicates other criminal fines and problems in the past. 

A $1.5 BILLION criminal fine sort of makes the "gee ... it was just an accident" story seem a bit weak.

Again, a certain amount of such things are going to happen given the vast numbers of people and activities involved.  The question is whether or not the company is minimizing the negative impact its operations have on our environment and our society.

In reality, big companies have to balance a lot of interests.  They have an obligation to make money for their shareholders and an obligation to be a good neighbor.  But their first and foremost obligation is to make a profit.

As the expression goes "I get it."  But that does not mean I need to watch their corporate propaganda on my TV.


Cloudia said...

SO well said!

Warm Aloha from Waikiki
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Jane of The Jewels said...

Informative post. I heard about the HSBC fine on the radio last night and my first thought was that this 1.9 billion was more than likely just a drop in the barrel! when compared to their overall profits. I think it's smart of you to change the channel when BP's propoganda plays - we are so inundated on a daily basis that sometimes it feels like that's the last bit of control we have over our environment.

A Lady's Life said...

Ya You are right.
They make so much money and our oil prices are still rising.
Doesn't make any sense at all.
It's always the little guy who gets to pay for all their mistakes anyway in the end. Then the government also charges so many taxes up here in Canada.
Every time people make demands they don;t seem to understand, they are going to pay for it anyway. So why not just pay for it and stop bothering government At least we save on paperwork and bureaucracy.