One and Done

May/07/2010 15:31PM
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We, the people, should have a choice. Choose between oil and no oil. BP put us in this position. The spill in the Gulf Coast makes it easy to stop all future oil exploration in this country. Just when Obama found it politically necessary to allow more offshore drilling, BP had the explosion. Just as Cap and Tax was a lost cause, BP put it back on the docket. No one has done more for the environmental cause than BP.

BP has a very bad track record in the US for the past decade. They had the explosion at the Texas City refinery. They tried to corner the market on propane futures. They neglected maintenance on the Alaskan pipeline and had a leak. After paying a huge fine for the tragedy at Texas City, they had a bad OSHA inspection and got another big fine. Same with their Toledo refinery.

From my perspective in the oil industry , BP was never a well-run company. Then, they merged with my former company, Amoco. Soon after that they took on Arco. Then, they bought Castrol. It was too big to fail, too big to run. They took the weak management model from BP and expanded it in the bigger company. The result is a company that isn’t on top of their business.

You, as a US citizen, will pay dearly for this. You will get Cap and Tax and the high energy prices that are built into the bill. You will get even higher energy prices because we won’t get the much needed oil from domestic production, onshore and offshore. You will continue to send money to countries that hate us in exchange for their oil.

You will find the promises for alternative energy aren’t delivered at any cost we can afford, if any is delivered at all. We will find ourselves in much worse shape on energy in another decade. And, we will have BP to blame.

BP, one the other hand, will do business as usual. They will lose some of their 24 billion in cash flow from the past year, but it will hardly be noticed on their balance sheet. They will lose some business, just as Exxon did after the Valdez, but the business will come back. They will collect from their insurance companies, their subcontractors, and everyone else they can tap. They will go on as a poorly managed entity, cutting costs and cutting corners. Beating up their people for the leadership errors at the top.

You, your kids, and your grand kids, on the other hand, will pay dearly for this problem. The progress we were about to make will be stopped in it’s tracks. Remember Three Mile Island and why we stopped building nuclear power plants in the US while the rest of the world kept building?

With an environmental issue like the BP problem, it’s one and done. No second chances for a decade or more. Public sentiment will be whipped into a frenzy by the media and the environmental zealots. Even rational Americans will reject offshore drilling.

A thirty year record of no serious incidents is gone in the blink of an eyelash.

Maybe I’m being too hard on BP, but based on the other problems they have had here in the past decade, it’s fair to think they were not on top of their sub-contractors on this one. It was a sub contractor working on Texas City when that explosion happened during a routine turnaround at the refinery. Many of those who died in that explosion were contractor employees just as it was in the offshore rig. Personnel who never should have been where they were when a refinery is coming up from a turnaround. Criminal charges were actually considered in that incident.

This can go two ways. The US can say when you conduct any risky endeavor there are risks. We can live with the risks because we desperately need the oil. We can crack down on BP and the other offshore and onshore drillers. We can keep finding oil offshore and onshore and move on. Or, we can as the idiot Governator of California has done, and say, no more offshore drilling here, ever.

Pick your choice. My guess, the fool Governators will prevail just as they have for the past 30 years. That’s why we are 80% dependent on foreign crude and finished products. We create our own problems by drinking the snake oil. Always erring on the side of caution, we have become a country that imports most of our finished goods.

Some day, not too far down the road, we will find we can’t run our economy and fight a war with no energy. When that day comes, a big tip of the hat to BP.

For specific information about the disaster go to the following link. the

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