Beyond
Petroleum:
The Coexistence of the Oil and Fishing Industries:
F
At What
Cost?
From the Mouths of Babes
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Deepwater Horizon Disaster
April 20, 2010
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The Damage Done
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BP has said this “accident”
was unforeseeable…
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Notice
Ixtoc Oil Spill 1979
On June 3, 1979, the Mexican government's oil company
Pemex was drilling a deep oil well in the Gulf of Mexico
when the well suffered a blow out resulting in one of the
worst oil spills in human history. At the time of the
incident the drilling was conducted at about 11,800 feet
below the sea floor.
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Notice
Ixtoc Oil Spill 1979
In the initial stages of the spill, an estimated 30,000 barrels of oil per day
were flowing from the well. In July 1979, the pumping of mud into the well
reduced the flow to 20,000 barrels per day, and early in August the pumping
of nearly 100,000 steel, iron, and lead balls into the well reduced the flow to
10,000 barrels per day. A total of 3.3 million barrels entered the Gulf of
Mexico as a result.
Compare current BP 2010 disaster: 60,000 barrels a day
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Notice
Ixtoc Oil Spill 1979
An average of about 10 to 30 thousand barrels a day were discharged into
the Gulf. The well was finally capped on March 23, 1980, nearly 10 months
later. Ultimately, 71,500 barrels of oil impacted 162 miles of U.S. beaches.
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Safety Violations
 2000 – In February, BP crew in the Gulf of Mexico pushed
the wrong button severing the rig from the blowout system
causing an oil leak.
- Mineral Management Service Safety Alert No.186, March 3, 2000
 2002 – California officials allege BP falsified inspections of
fuel tanks at a Los Angeles refinery and more than 80% of
the facilities didn’t meet requirements to maintain storage
tanks without leaks or damage. BP settled a lawsuit
brought by the South Coast Air Quality Management
District for more than $100m.
- Reports at BP over years find history of problems,
The Washington Post, June 8, 2010,
by Abraham Lustgarten and Ryan Knutson
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Safety Violations
 2005 – A BP Texas City refinery exploded, killing 15
people. The investigation uncovered that a warning
system failed and that “significant process safety issues
exist at all five U.S. refineries, not just Texas City.”
 2006 – In March, more than 200,000 gallons of oil spilled
from a corroded hole in the Prudhoe Bay pipeline in
Alaska. Inspectors found that several miles of the steel
pipe had corroded to dangerously thin levels. BP had
received multiple warnings about their Alaskan pipelines
since 2002.
- Reports at BP over years find history of problems,
The Washington Post, June 8, 2010,
by Abraham Lustgarten and Ryan Knutson
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Safety Violations
 October 25, 2007, the Justice Department settled with BP at $20
million in penalties and three years' probation, $12 million of
criminal fine.
- May 19, 2010 Panel I of a Hearing of the House and
Transportation and Infrastructure Committee
 2008 – In September, a section of gas pipeline on an Alaskan slope
blew apart, flying nearly 1000 feet through the air before landing on
the tundra.
 2009 – Three separate accidents plagued the same Alaskan
pipeline system, one of which was a near-catastrophic explosion.
Congress sent a letter to BP stating these accidents were a result of
malfunctioning safety and backup equipment.
- Reports at BP over years find history of problems,
The Washington Post, June 8, 2010,
by Abraham Lustgarten and Ryan Knutson
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Safety Violations
The blowout preventer is BP’s “key failsafe
mechanism”
the House and
Testimony of Lamar McKay, President of BP
May 19, 2010, Panel I of a Hearing of
Transportation and Infrastructure
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Safety Violations
Deepwater Horizon seamen discovered a BOP leak
two weeks before the blowout in early April of 2010.
On July 21, 2010 it was revealed that 45% of BOP's fail.
Safe Device,
June 20, 2010.
- Regulators Failed to Address Risks in Oil Rig FailNew York Times,
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Tony Hayward, CEO of BP
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BP’s Public Statements – Day 9
“What the hell did we do to deserve this?”
BP Chief Tony Hayward
Oil Spill’s Blow to BP’s Image May Eclipse Costs,
New York Times, April 29, 2010
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Safety Violations
 “First is this whole issue of the ultimate safety device, the
blowout preventer failing. If the blowout preventer had functioned
as intended, we would be dealing with a very serious industrial
accident, but we wouldn’t be dealing with an oil spill.”
BP CEO Tony Hayward
In His Own Words: Forbes Q&A with BP’s Tony Hayward,
Forbes.com, May 18, 2010, by Christopher Helman
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BP’s Public Statements – Day 24
“The Gulf of Mexico is
a very big ocean. The
amount of volume of
oil and dispersant we
are putting into it is
tiny in relation to the
total water volume.”
Tony Hayward, BP CEO
- May 14, 2010
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Willful and Wanton Conduct
“The oil is on the surface…”
“There aren’t any plumes.”
BP sampling showed “no evidence”
that oil was suspended in large masses
beneath the surface.
Meanwhile, a twenty-two mile long, six mile wide and more than a
thousand feet deep plume was being reported by the University of
South Florida and other Southeastern educational institutions.
BP CEO Tony Hayward
BP CEO disputes claims of underwater oil plumes,
AP, May 30, 2010
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BP’s Public Statements – Day 28
Tony Hayward, BP CEO:
“I think the
environmental impact
of this disaster is
likely to be very, very
modest.”
- May 18, 2010
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BP’s Public Statements – Day 27
 “The Gulf of Mexico spill response plan is four inches thick. It’s
approved every two years.”
BP CEO Tony Hayward
In His Own Words: Forbes Q&A with BP’s Tony Hayward,
Forbes.com, May 18, 2010, by Christopher Helman
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BP Oil Spill Response Plan
 The covers of the five response plans
are 4 different colors, but the content is
90 percent identical. Like BP, three
other companies include references to
protecting walruses, which have not
called the Gulf of Mexico home for 3
million years.”
 “…the only technology [the oil companies] seem to be relying upon is
a Xerox machine to put together [their] response plans…”
- Representative Edward J. Markey
“Drilling Down on America’s Energy Future: Safety, Security, and Clean Energy”
Hearing before the Committee on Energy and Commerce
June 15, 2010
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Transocean
MR. HAYWARD: This wasn't our accident. This was a drilling rig
operated by another company. It was their people, their systems, their
processes.
“We are responsible, not for the accident, but we are responsible for
the oil and for dealing with it and cleaning the situation up.”
MR. STEPHANOPOULOS: You're not responsible for the accident?
MR. HAYWARD: The drilling rig was a Transocean drilling rig. It was their
equipment that failed. It's their systems and processes that were
running it.
- ABC “Good Morning America” Interview with Tony Hayward,
British Petroleum Chairman; Subject: Gulf Coast Oil Spill,
May 3, 2010
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Who is Responsible?
THE
CORPORATIONS
Owners of Mississippi
Canyon Block 252 license
where the well was drilled.
Halliburton Energy Services Inc, provided
drilling services on the rig. Halliburton was
in the process of cementing the wellhead
when the blowout occurred.
As for BP, The Partners
are liable for costs in
proportion to their
holdings.
BP Leased the Deepwater Horizon rig from
Transocean, The world’s largest offshore
drilling firm based in Switzerland.
The Blowout equipment which failed on the
Deepwater Horizon rig was maintained by
Cameron International Corp, a subsidiary of
Transocean.
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Corporate Finger-pointing
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Tony Haywood, BP CEO
“I’d like my life back.”
BP CEO Tony Hayward
Business Insider, June 2, 2010,
by Gus Lubin
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Selling the Fund
 The BP Fund: Kenneth Feinberg “Mr. Fairness”
 The Oil Protection Act 1990
 Multi-District Litigation New Orleans, LA
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BP Claims Process
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BP's USA Today full page
AD on the Claims Process:
June 10th, 2010
What’s happening within the BP
Claims Processing
"When we talk, we'll help people
determine what documents they
need. We will be in touch in four
days or less and can issue them
a check right on the spot.“
- June 10, 2010
50 million dollars spent by BP on
advertising alone in May 2010.
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What’s really happening within
the BP Claims Processing
Compare what our clients were told by BP claims
officials the same time this full page national ad
and PR campaign ran:
 “Well, we don’t actually have any checks… yet”
6/10/2010 (BP claims personnel)
 “We may get checks next week…” 6/11/2010
(BP claims personnel)
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What’s really happening with the
BP Claims Processing
 While BP was claiming it was
“mak[ing] this right,” BP had
policemen and police cars at
every distribution center to
welcome the fishermen.
 And for those trying to forget
Hurricanes Katrina or Wilma
or Ivan? “Think of me like an
adjuster…” 6/10/2010
(BP claims personnel)
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BP Claims Process
 BP’s “adjusters” are given a script and using a matrix and
intentionally beating down people in need.
 As of Tuesday, June 15, 2010, BP adjusters had paid less
than 12% (twelve percent) ($71 million dollars out of an
estimated $600 million) of submitted claims for relief by
individuals and businesses impacted in the Gulf.
- House of Representatives,
Committee on the Judiciary,
6/15/2001
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BP Fund
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BP Fund
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BP Fund
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BP Fund
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BP Fund
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BP Fund
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Stabilizing the Industry
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Lifting the Moratorium on Drilling October 2010
Threats of Pulling out of Gulf
11% of BP’s Revenue from the Gulf
Are the rigs any safer?
Is the fishing industry any more secure?
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