How the owner of the exploded oil rig has
made $270 million off the disaster, and nine other shocking, depressing
facts about the oil spill.
It's been 37 days since BP's offshore oil rig, Deepwater Horizon, exploded
in the Gulf of Mexico. Since then, crude oil has been hemorrhaging into
ocean waters and wreaking unknown havoc on our ecosystem -- unknown
because there is no accurate estimate of how many barrels of oil are
contaminating the Gulf.
Though BP officially admits to only a
few thousand barrels spilled each day, expert estimates peg the damage
at 60,000
barrels or over 2.5 million gallons daily. (Perhaps we'd know more
if BP hadn't barred independent
engineers from inspecting the breach.) Measures to quell the gusher
have proved lackluster at best, and unlike the country's last big oil
spill -- Exxon-Valdez in 1989 -- the oil is coming from the ground, not a
tanker, so we have no idea how much more oil could continue to pollute
the Gulf's waters.
The Deepwater Horizon disaster reminds us what
can happen -- and will continue to happen -- when corporate malfeasance
and neglect meet governmental regulatory failure.
The corporate
media is tracking the disaster with front-page articles and nightly
news headlines every day (if it bleeds, or spills, it leads!), but the
under-reported aspects to this nightmarish tale paint the most chilling
picture of the actors and actions behind the catastrophe. In no
particular order, here are 10 things about the BP spill you may not know
and may not want to know -- but you should.
1. Oil rig
owner has made $270 million off the oil leak
Transocean
Ltd., the owner of the Deepwater Horizon rig leased by BP, has been
flying under the radar in the mainstream blame game. The world's largest
offshore drilling contractor, the company is conveniently headquartered
in corporate-friendly Switzerland, and it's no stranger to oil
disasters. In 1979, an oil well it was drilling in the very same Gulf of
Mexico ignited, sending the drill platform into the sea and causing one
of the largest oil spills by the time it was capped... nine months
later.
This experience undoubtedly influenced Transocean's
decision to insure theDeepwater Horizon rig for about twice what it was
worth. In a conference call to analysts earlier this month, Transocean
reported making a $270 million profit from insurance payouts after the
disaster. It's not hard to bet on failure when you know it's somewhat
assured.
2. BP has a terrible safety record
BP
has a long record of oil-related disasters in the United States. In
2005, BP's Texas City refineryexploded,
killing 15 workers and injuring another 170. The next year, one of its
Alaska pipelines leaked 200,000 gallons of crude oil. According to
Public Citizen, BP has paid $550
million in fines. BP seems to particularly enjoy violating the
Clean Air and Clean Water Acts, and has paid the two largest fines in
the Occupational Safety and Health Administration's history. (Is it any
surprise that BP played
a central, though greatly under-reported, role in the failure to
contain the Exxon-Valdez spill years earlier?)
With Deepwater
Horizon, BP didn't break its dismal trend. In addition to choosing a cheaper --
and less safe -- casing to outfit the well that eventually burst, the
company chose
not to equip Deepwater Horizon with an acoustic trigger, a
last-resort option that could have shut down the well even if it was
damaged badly, and which is required in most developed countries that
allow offshore drilling. In fact, BP employs these devices in its rigs
located near England, but because the United States recommends rather
than requires them, BP had no incentive to buy one -- even though they
only cost $500,000.
SeizeBP.org
estimates that BP makes $500,000
in under eight minutes.
3. Oil spills are just a cost of
doing business for BP
According to the Harte Research
Institute for Gulf of Mexico Studies, approximately $1.6
billion in annual economic activity and services are at risk as a
result of the Deepwater Horizon disaster. Compare this number -- which
doesn't include the immeasurable environmental damages -- to the current
cap on BP's liability for economic damages like lost wages and tourist
dollars, which is $75 million. And compare that further to the
first-quarter profits BP posted just one week after the explosion: $6
billion.
BP's chief executive, Tony Hayward, has solemnly
promised that the company will cover more than the required $75 million.
On May 10, BP announced it had already spent $350 million. How
fantastically generous of a company valued at $152.6 billion, and which
makes $93 million each day.
The reality of the matter is that BP
will not be deterred by the liability cap and pity payments doled out to
a handful of victims of this disaster because they pale in comparison
to its ghastly profits. Indeed, oil spills are just a cost
of doing business for BP.
This is especially evident in a
recent Citigroup analyst report prepared for BP investors: "Reaction to
the Gulf of Mexico oil leak is a buying opportunity."
4.
The Interior Department was at best, neglectful, and at worst, complicit
It's
no surprise BP is always looking out for its bottom line -- but it's at
least slightly more surprising that the Interior Department, the
executive department charged with regulating the oil industry, has done
such a shoddy job of preventing this from happening.
Ten years
ago, there were already
warnings that the backup systems on oil rigs that failed
on Deepwater Horizon would be a problem. The Interior Department issued a
"safety alert" but then left it up to oil companies to decide what kind
of backup system to use. And in 2007, a government regulator from the
same department downplayed the
chances and impact of a spill like the one that occurred last month:
"[B]lowouts are rare events and of short duration, potential impact to
marine water quality are not expected to be significant."
The
Interior Department's Louisiana branch may have been particularly
confused because it appears it was closely fraternizing with the oil
industry. The Minerals Management Service, the agency within the
department that oversees offshore drilling, routinely accepted gifts
from oil companies and even considered itself a part of the oil
industry, rather than part of a governmental regulatory agency. Flying
on oil executives' private planes was not rare for MMS inspectors in
Louisiana, a federal
report released Tuesday says. "Skeet-shooting contests, hunting and
fishing trips, golf tournaments, crawfish boils, and Christmas parties"
were also common.
Is it any wonder that Deepwater Horizon was
given a regulatory exclusion by MMS?
It gets worse. Since April
20, when the Deepwater Horizon oil rig exploded, the Interior Department
has approved 27
new permits for offshore drilling sites. Here's the kicker: Two of
these permits are for BP.
But it gets better still: 26 of the 27
new drilling sites have been granted regulatory exemptions, including
those issued to BP.
5. Clean-up prospects are dismal
The
media makes a lot of noise about all the different methods BP is using
to clean up the oil spill. Massive steel containment domes were popular a
few weeks ago. Now everyone is touting the "top kill" method, which
involves injecting heavy drilling fluids into the damaged well.
But
here's the reality. Even if BP eventually finds a method that works, experts
say the best cleanup scenario is to recover 20 percent of the
spilled oil. And let's be realistic: only 8 percent of the crude oil
deposited in the ocean and coastlines off Alaska was recovered in
the Exxon-Valdez cleanup.
Millions of gallons of oil will remain
in the ocean, ravaging the underwater ecosystem, and 100 miles of
Louisiana coastline will never be the same.
6. BP has no
real cleanup plan
Perhaps
because it knows the possibility of remedying the situation is
practically impossible, BP has made publicly available its laughable
"Oil Spill Response Plan" which is, in fact, no plan at all.
Most
emblematic of this farcical plan, BP mentions protecting Arctic
wildlife like sea lions, otters and walruses (perhaps executives simply
lifted the language from Exxon's plan for its oil spill off the coast of
Alaska?). The plan does not include any disease-preventing measures,
oceanic or meteorological data, and is comprised mostly of phone numbers
and blank forms. Most importantly, it includes no directions for how to
deal with a deep-water explosion such as the one that took place last
month.
The whole thing totals 600 pages -- a waste of paper that
only adds insult to the environmental injury BP is inflicting upon the
world with Deepwater Horizon.
7. Both Transocean and
BP are trying to take away survivors' right to sue
With
each hour, the economic damage caused by Deepwater Horizon continues to
grow. And BP knows this.
So while it outwardly is putting on a
nice face, even pledging
$500 million to assess the impacts of the spill, it has all the
while been trying to ensure that it won't be held liable for those same
impacts.
Just after the Deepwater explosion, surviving employees
were held in solitary
confinement, while Transocean flacks made them waive their rights
to sue. BP then did the same with fishermen it contracted to help clean
up the spill though the company now says that was nothing more than a legal
mix-up.
If there's anything to learn from this disaster,
it's that companies like BP don't make mistakes at the expense of
others. They are exceedingly deliberate.
8. BP bets on
risk to employees to save money -- and doesn't care if they get sick
When
BP unleashed its "Beyond Petroleum" re-branding/greenwashing campaign,
the snazzy ads featured smiley oil rig workers. But the truth of the
matter is that BP consistently and knowingly puts its employees at risk.
An
internal BP document shows that just before the prior fatal disaster --
the 2005 Texas City explosion that killed 15 workers and injured 170 --
when BP had to choose between cost-savings and greater safety, it went
with its bottom line.
A BP
Risk Management memo showed that although steel trailers would be
safer in the case of an explosion, the company went with less expensive
options that offered protection but were not "blast resistant." In the
Texas City blast, all of the fatalities and most of the injuries
occurred in or around these trailers.
Although BP has responded
to this memo by saying the company culture has changed since Texas City,
11 people died on the Deepwater Horizon when it blew up. Perhaps a
similar memo went out regarding safety and cost-cutting measures?
Reports this
week stated that fishermen hired by BP for oil cleanup weren't provided
protective equipment and have now fallen ill. Hopefully they didn't
sign waivers.
9. Environmental damage could even include a
climatological catastrophe
It's hard to know where to
start discussing the environmental damage caused byDeepwater Horizon.
Each day will give us a clearer picture of the short-term ecological
destruction, but environmental experts believe the damage to the Gulf of
Mexico will be long-term.
In the short-term, environmentalists
are up
in arms about the dispersants being used to clean up the oil slick
in the Gulf. Apparently, the types BP is using aren't all that effective
in dispersing oil, and are pretty high in toxicity to marine fauna such
as fish and shrimp. The fear is that what BP may be using to clean up
the mess could, in the long-term, make it worse.
On the
longer-term side of things, there
are signs that this largest oil drilling catastrophe could also
become the worst natural gas and climate disaster. The explosion has
released tremendous amounts of methane from deep in the ocean, and
research shows that methane, when mixed with air, is the most powerful
(read: terrible) greenhouse gas -- 26 times worse than carbon-dioxide.
Our
warming planet just got a lot hotter.
10. No one knows
what to do and it will happen again
The very worst part
about the Deepwater Horizon calamity is that nobody knows what to do. We
don't know how bad it really is because we can't measure what's going
on. We don't know how to stop it -- and once we do, we won't know how to
clean it up.
BP is at the helm of the recovery process, but
given its corporate track record, its efforts will only go so far -- it
has a board of directors and shareholders to answer to, after all. The
U.S. government, the only other entity that could take over is currently
content to let BP hack away at the problem. Why? Because it probably
has no idea what to do either.
Here's the reality of the matter
-- for as long as offshore drilling is legal, oil spills will happen.
Coastlines will be decimated, oceans destroyed, economies ruined, lives
lost. Oil companies have little to no incentive to prevent such
disasters from happening, and they use their money to buy government
regulators' integrity.
Deepwater Horizon is not an anomaly --
it's the norm.
Daniela
Perdomo is a staff writer and editor at
AlterNet. Follow
Daniela on Twitter. Write her at danielaalternet [at]
gmail [dot] com..
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