Deepwater Horizon Oil Spill
By
Ayse Miray Gunen
ID: 13343594
Subject Name: Corporate Responsibility and Governance
Subject Code: 5231
Lecturer Name: Ian Kirkwood
INTRODUCTION
British Petroleum, also known as BP, which has approximately 80.000 employees and headquartered in
London, is one of the world’s integrated oil and gas companies, operating more than 70 countries and
producing fuel, energy, lubricants and petrochemical products with a daily 4 millions of barrels of oil
equivalent. The company is involved in all aspects of the process including exploration, production,
refining, and distribution. (BP, 2016)
On 20 April 2010, a devastating explosion occurred at British Petroleum’s Deepwater Horizon oil rig in the
Gulf of Mexico. The explosion and following oil spill is considered as one of the most catastrophic
disasters of the history. The disaster is also known as The Gulf of Mexico Oil Spill, where 11 people went
missing and five millions of barrels of oil leaked from the BP’s well. (BP, 2016)
The oil spill after the explosion and the controversial cleaning product used by BP damaged the marine
life irreversibly in Gulf of Mexico and surrounding areas. The oil spill revealed numerous legal, social and
environmental consequences as well as ethical consequences for BP and the other companies involved.
The purpose of this study is to analyse the incident and especially the approach of BP after the disaster in
terms of business ethics. However, legal responsibilities or liabilities will be excluded and the discussion
will be restricted to ethical issues due to the purpose of this study.
DISCUSSION
As known the main purpose of a business is to produce goods and services, generally at a profit.
Business ethics is whether these activities are acceptable or not by societies, regardless of they are legal
or illegal. In some situations, despite the legal compliance, firm’s activities can be detrimental for societies
and the environment they live in. Businesses are responsible to fulfil its ethical obligations to their
stakeholders who are affected from the business’ activities (in this case the company, the employees and
the customers) while making profit.
BP’s public image and PR had already been questioned for the past decade since the oil spill in the Gulf
of Mexico was not the first incident that the company had been involved. There had been other
explosions at BP’s refinery in Texas City in 2005 where 15 workers died and 180 injured and two oil spill
in Prudhoe Bay, in less than five years. (Telegraph, 2012). These disasters had already caused BP to
lose their market popularity. Investigations showed that BP’s cost-reduction policies led to safety
irregularities at both refineries. Although BP admitted its fault in previous events, the company did not
take precaution in Deepwater Horizon in the Gulf of Mexico.
There have been many groups directly or indirectly affected by the oil spill in the Gulf such as people
working in tourism industry, fishermen, and creatures as well as the companies- Transocean, Cameron
and Halliburton. According to BP’s investigation report published on 8th September 2010 ‘’There was no
single factor caused the accident. The report stated that decisions made by multiple companies and work
teams contributed to the accident, and these arose from a complex and interlinked series of mechanical,
human judgement, engineering design, operational implementation and team interface failures.’’ (BP,
2010)
The blowout preventer stack, built by Cameron International Corporation, was in use on the Deepwater
Horizon since the commissioning of the rig in 2001. (Det Norkse Veritas, 2011) Although Cameron was
blamed for the blowout, there had no evidence that the disaster occurred by its mistake. ‘’BP was the
main operator/lease holder responsible for the well design, and Transocean was the drilling contractor
that owned and operated the Deep Water Horizon.’’ (CSB, 2016) Attorney General Eric Holder states that
Transocean had failed to secure the well properly, failed to maintain drilling equipment and failed to
monitor the well, and that those failures had caused the spill. (Global Research, 2010) According to
Bureau of Energy Management Regulation and Enforcement ‘’BP, Transocean and Halliburton’s conduct
in connection with the Deepwater Horizon disaster violated a number of federal offshore safety
regulations under BOEMRE’s jurisdiction.’’ (BOEMRE, 2011)
All the internal and external investigations show that BP and its partners did not follow the regulations and
code of ethics at the oil platform which caused countless losses of live and ethical dilemmas in terms of
the purpose of a company making profit and environmental consciousness. BP has already been paying
a price for the fault in the Gulf. However, as mentioned above, it was not the first incident in a very short
time. This gives the impression to the society that BP has the money to cover up their lack of moral and
ethical responsibility.
One of the ethical issues occurred after the spill was BP’s media blackout. BP restricted the information
flow on media, therefore violated one of the fundamental human rights, freedom of information. Secondly,
magnitude of oil spill another ethical issue occurred after the spill was the misinformation released by the
company (and even government) to minimize the public pressure. Lastly, maybe the most destructive one
for the maintenance of the disaster, BP chose the worse dispersant for clean-up called Corexit by
rejecting the scientists’ requests for help. Although the dispersant was good for cleaning the spill; it was
leaving long-term effects in the marine ecosystem. It has been another issue in terms of ethics that the
company may have caused more destructive effects on the ecosystem than the spill itself. (Climate
Science Watch, 2013)
The incident can be evaluated on the perspective of Ethic Theories for a better understanding. For
instance, ‘’Utilitarian Theory says that an action is morally right if it results in the greatest amount of good
for the greatest amount of people affected by the action.’’ (Potter-Mordant, 2016) According to this theory,
this disaster was totally unethical since everyone suffered where every party should have equally
benefitted from the organization’s activities. It left only harmful effects behind with financial and moral
costs. Therefore there is a contrast between this theory and the accident. On the other hand, for the
Egoism Theory, this accident is completely ethical. The theory is described by Sophie Potter-Mordant as
‘’It focuses the individual and says that an action is morally right if the decision maker is able to freely
decide an action in order to pursue their (short-term) desires or (long-term) interests.’’ (Potter-Mordant,
2016) When it is discussed under this theory, BP did everything for its advantage, by excluding the
people and environment. Hence, nothing was unethical.
CONCLUSION
It is obvious that all parties involved in this case suffered from the consequences of the disaster. In fact,
as all massive companies do, BP aimed profitability instead of better living conditions for its employees
and the nature itself. The incident costed millions of dollars that the company could have been invested
on the future trading activities or social responsibility projects.
Although it is estimated that the effects of the accident will take many years to be wiped out from the
environment, only 6 years later the CEO of the company declared that the company is still targeting more
production and profit with the following sentences;
‘’We started the year with a goal to increase production from new projects by 800,000 barrels a day by
2020. During 2016 we remained on track for that goal, and we have increased our ambition to over a
million barrels a day by 2021.’’ (Dudley, 2017)
Apart from the ethical issues on the disaster, even this statement represents the ethical approach of the
company.
To conclude, as Andrew Winston stated; ‘’BP nets about $20 billion a year. How much do you think BP
should have spent on extra precautions and new clean-up technologies? Imagine if every well had a
second, relief well nearly dug at all times. Expensive, yes, but so is the destruction of your reputation and
business, not to mention an entire ecosystem.’’ (Winston, 2010)
A. Miray Gunen
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