Comment by tristanj
12 hours ago
No, they are definitely terrified about it happening again. Deepwater Horizon cost BP nearly $70 billion total in direct financial payouts, including $20 billion in fines. $140 billion if you include total financial cost to BP. This is an enormous amount of money, even for a large corporation such as BP. BP suspended their dividend because of the spill.
That's a massive amount of money that could have went to paying shareholders, and that's why they don't want it happening again.
Just about every week there’s news of some kind of ecosystem damage by another negligent company that streams into my RSS feed.
Related, but the American gov recently invaded a country to take its oil while simultaneously shutting down funding for green energy projects. Exhausting.
The problem is sometimes the lessoned learned is don’t be responsible.
So no longer own oil tankers and instead each ship is owned by its own LLC so just that piece goes down and the liability gets capped to its insurance contract.
Externalization at its finest. Pocket the profits and let the world deal with the trash. I absolutely hate these people.
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It's not really your argument, but to be clear nobody is actually claiming the US followed Israel into war with Iran because of oil.
It was surely a reference to Venezuela.
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The country is Venezuela
I don't condone corporate negligence or violations of environmental protection laws, but some kind of ecosystem damage is an inevitable consequence of humans existing with an advanced industrial civilization. We're going to have an impact.
> but some kind of ecosystem damage is an inevitable consequence of humans existing with an advanced industrial civilization
Well in this case the consequence is "we are destroying the conditions of our own survival". Open question is whether an advanced industrial civilisation can survive at all.
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That sure sounds like the definition of "condone."
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Yes but we could have a significantly less one though. We're extremely wasteful and plan ahead poorly for minimizing the environmental impact, which becomes a partisan political issue instead of just doing our best to live in a healthy environment.
If you compare our impact per capita and per dollar of GDP it’s much less today than 50 years ago. There’s just more dollars and more capita.
We are getting better at this. Time will tell if we are getting better at it fast enough. Ask someone in 2126.
And no I don’t think we will be dead, but if we do too much damage the world may be severely degraded and they might be quite angry at previous generations for basically leaving them with the bill.
What’s exhausting is shifting the goal posts. BP should be held up as a great example where the responsibility transferred onto the shareholders.
“Oh, but there are other bad actors doing things” is not a counterpoint. That’s the same as claiming a government can’t work by pointing to a different failed policy every time someone points how how a policy failure was corrected.
A recent Conversations with Tyler episode with Jared Diamond made this point. Diamond mentions touring a oil drilling facility expecting to be outraged but being shocked at the safety effort on display. His explanation was that the oil companies are terrified of spills.
> $140 billion if you include total financial cost to BP.
That's more than their current market cap ($127B), and the stock price right now is not that far from where it was just before the spill ($49 now, around $59 just prior to the spill).
I'm just curious how that was accomplished, given that it would not have been a great time for them to be borrowing or issuing new shares, for obvious reasons. Maybe if it was spread out over like 10 years it could be more doable, but still that seems like a lot.
Essentially how most businesses (big and small) handle this situation. Multi pronged approach.
Sold a bunch of assets to raise funds (about 38b apparently), cut the dividend, borrowed the remaining (you'd think after such an event it's 'hard' to raise capital but in reality BP has a great financial record and there's a chance they had prior agreements in place) and then spread cost out over ~10 years.
The stock price fell by 50ish percent, and they've spent 16 years recovering.
Yet, our ecosystem likely never will. I wonder which is more important to not let fail.
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BP share price was over $100 the month before the disaster. They sold $45B in global assets and subsidiaries (including most of their refinery business and land holding 6 billion barrels of proven reserves) and cut their dividend to fund the damages and fines.
> BP share price was over $100 the month before the disaster
If you checked the share price via Google Finance, it's off by 2x. The share price on April 19, 2010 (a day before the disaster) was $59.48, not >$100. Google Finance is erroneously reporting the price.
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It wasn't enormous enough in fines, since they're still in business and capable of doing it again, and again surviving such fines.
Even if it was enormous enough in fines to put them out of business, the industry as it is with all its inherent risks will still exist because that is still legally allowed. Forget a fine; outlaw the behavior that lead to the issue. Incentivize new emergent behavior instead of just hedging.
The behavior that leads to the issue is individual consumers driving cars. Outlawing this would nuke demand for fossil fuels which encourages risky well drilling. But since 99% of Americans drive they tend to get very unhappy about the prospect of banning the vroom vroom. This is a real and challenging political problem. We can't get around it by pretending that corporations drill for fun.
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Don't worry. BP is sorry[1] for the spill. That should be enough, right?
1: https://www.youtube.com/watch?v=9u0EL_u4nvw
Didn’t you hear? They (gasp) had to suspend the dividend.
BP is a European company. You know what the cost would have been for ExxonMobil? Pocket change. See multiple spills in Alaska for examples.
BP's revenue in the last 30 years is over $6.5 trillion. Other than the bad press and some lost coins, they don't really give a shit.
Did anyone go to jail? Was anyone executed? Was BP dissolved?
Not enough stakeholders are terrified enough.
If the upside is profit and the maximum downside is losing money, corporations will happily rape the Earth.
The system is working as designed.
Even if we executed everone involved the lesson would have been to segregate responsibility and find a fall guy