Wednesday, June 2, 2010

BP's Corporate Irresponsibility

British Petroleum (BP) has joined Exxon as one of the most vilified corporations in the world. BP has a poor record on environmental and safety issues.

The potential damage to the Gulf Coast's environment and regional economy, from its fisheries, recreational industry, and other businesses, is devastating, big enough that some economists are starting to worry the spill could push the nation's economy into a double-dip recession.

The company already had a series of environmental and safety issues including a 2005 explosion at its refinery in Texas City, Texas which killed 15 workers and injured hundreds more. The company was fined a record $87 million for not correcting safety problems. A break in a BP-owned pipeline on the North Coast of Alaska spewed 200,000 gallons of oil in March 2006. Over 100 million in fines for these two events meant very little to BP's multi-billion dollar balance sheet.

Originally founded in the UK to focus on North Sea oil, BP is now one of the largest energy companies in the world operating in close to 30 countries on almost every continent. In 2009, the company produced 2.53 million barrels of oil per day and 8.48 million cubic feet of natural gas per day.

BP is also one of the world's biggest oil exploration companies. Their discovery of a deepwater oil field in the Gulf of Mexico during September of 2009 set in motion events that led to the blowout on April 20, 2010 and caused an explosion that killed 11 platform workers and injured 17 others.

Like all great corporate villains, BP has covered its misdeeds with deceit. They have consistently underestimated the amount of oil spewing from their undersea well and they have overestimated the amount of oil they are siphoning off. BP has further prevented independent third party measurements. While BP initially estimated that 5000 barrels of oil per day were escaping into the Gulf, the real estimate could be as much as 100,000 barrels a day.

The environmental carnage will only get worse as the oil continues to hit coastal states throughout the region. Although it may take months to plug this leak, BP's reputation may never recover.
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Next: Responsibility for the Costs of the Gulf Oil Spill / Obama Presidency and the Gulf Oil Spill

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