Sunday, 2 May 2010
Somebody to Love
barrels a day but looking at the pictures it's pretty big.
I just shrug my shoulders: these things happen. It's the price we pay for our comfortable life. Except, usually it's not us who directly pick up the tab. This time, there's a real danger that much of the Gulf's coastline will be seriously inundated with choking, suffocating, sticky,smelly oil. The price will be paid by the wild life, the folks who live and earn a living in the region (Venice, Louisiana; Pascagoula and Biloxi, Mississippi; Mobile, Alabama; and Pensacola, Florida); with considerable dislocation of people's day to day living for miles around.
If you're a BP share holder your future earnings are likely to be hit by the loss of revenue from the Deepwater Horizon rig, and the massive clean up and reparation costs. Given the nature of the world oil market, BP won't easily recoup these costs through a price hike; hence the share price fall.
And there's the lives of the eleven contractors lost when the rig blew up.
For BP, the risk to the company's reputation is staggering. Which goes some way to explaining not only the huge effort the company is putting into this crisis but a statement on their website . "BP is fully committed to taking all possible steps to contain the spread of the oil spill. We are taking full responsibility for the spill and we will clean it up, and where people can present legitimate claims for damages we will honour them."
This spillage reminds us of the cost of getting the black gold out of the ground. The contrast between the shiny, sexy, bling image that oil and motor companies sell us, and we buy, and the images of the dirty, smelly, inconvenient material we see on all the media is not something their executives want to dwell on.
There is some positives that will come out of this. First and foremost, our planet has a huge capacity to self heal. Wild life populations might plummet and there'll be dire warnings of species extinction, permanent loss of habitat etc., yet where these disasters take place after time life springs back and recolonises. Second, as a result lessons will be learnt and systems will be improved and regulations beefed up so that this type of spillage is less likely to happen again and if it does the response will be more timely and effective.
In the meantime, we take a deep breath and hope the outcome is not as poor as it might be.
One final thought, this accidental spillage has attracted world wide attention. The deliberate flaring of oil wells (burning off the natural gases associated with the oil) in the Nigeria delta goes on without comment. The energy generated by this policy is enough to supply three times Nigeria's energy use; in a country where only 30 % of its population have access to a reliable electricity supply.
But, of course, the eyes of the world opinion formers are focused eleswhere; so there's little risk to the oil companies' reputations.