Oil, Lies and Videotape

When the explosion occurred on the Deep water Horizon rig in the gulf of Mexico, I was shocked and saddened by the loss of life. Even at that time I nearly posted regarding this event as I could foresee the environmental disaster that has subsequently unfolded.

However, as I always try and check the facts, I quickly realised that accurate information was very thin on the ground. Unlike the oil on the water.

As well as the three companies involved playing the blame game and acting like five year olds in the school yard, the main question was just how much oil was escaping this well head. That actually should have been an easy question to answer as BP, the company has not been called British Petroleum for years, pays royalties for the oil that flows out. Therefore both BP and the US government knew what the flow rate was, and this would tell the Coast guard et al what volume of oil was escaping. But I could not get that information as I was told it was commercially confidential.

It was clear that the PR (the P stands for Propaganda) machine was in full swing. With neither BP or the federal authorities in charge of oversight telling it the way it is but trying to spin the facts to make the situation appear less serious than it is. Because of this lack of openness, the Coast guard was forced to try and calculate the volume of the oil escape by measuring the volume of surface oil.

This was in part why BP used the dispersant's at the well head as this visibly reduced the amount of oil that would appear at the surface. Just like PR its about making things look better than it really is, and not about being truly honest.

Then while following the situation, the political fall out meant that the president and the US government were getting blamed for not doing more. What can the do? They do not have the technology nor the expertises to shut off this well head. I personally had visions of the president donning a wet suit and swimming down to turn some shut off valve. Well had it been that simple BP would have done this already. This is actually a major part of the problem, BP had never even considered a blow out of this type could ever happen thus they had no plans to deal with the eventuality. That is not just my opinion but a quote from someone who used to work for BP.

Further, even before the oil started coming ashore, BP were telling volunteers that wanted to help stop the environmental damage to stay away. They said that people had to be trained and they had enough people. Now you can call me cynical but to me it sounded like BP saying “stay away so we can keep the real environmental damage quiet”.

The point is, that BP have spent as much effort on trying to spin the news as they have on trying to stop the leak. Take for example the futile effort to use shredded golf balls etc to plug the well. Now only a company that creates pollution could have dreamed that on up. How to stop pollution use more pollution. Anyone that had a basic understanding of physics could have told them that would not work, but it looked good for the media!

With the internet age it is possible to see and read the different ways that the media on both sides of the Atlantic are reporting this. While I don't much like the rants that seemed to have filled the American media, here the reporting has been down playing the level of the disaster. Over here you can clearly see the hand of PR guiding the media to downplay the situation.

Then this weekend, as the share price of BP tumbles, the emphasis has been spun saying; “that the US president is damaging a British company” and this was effecting ordinary people as most pension funds have invested in BP.

This puzzles me as it is not the US President or the US government that caused this disaster it was BP. The cost of the clean up will have to be born by BP, so it is the actions of BP that have caused the share price to fall. As the share holders are the owners of BP, they have a responsibility to make sure that BP operates in a way that the company is not cutting the corners that could lead to the company having to pay out billions to clean up their own mess.

While I understand that the individual folks that have invested in pensions have no real control, the pension fund managers do. Cutting corners to increase profits may look good on paper, but the effects of this are happening in the Gulf of Mexico. It is the owners of BP who have to pay the cost, not the US tax payer. If the situation were reversed and it was a US company that had caused a major spill in the North Sea, would US investors be calling for the UK tax payer to meet the costs to protect their investment?

The oil industry along with the coal industry, especially the ones that are involved in mountain topping, always argue that its the jobs and wealth creation that matters. Yet it is often the other industries and people that suffer as a result. The oil from this major spill will effect the tourist industry for years costing billions. The fishing industry in the US will suffer for decades. The impact upon wildlife will also have a serious economic impact. For example, each of the wolves in Yellowstone generates over one million dollars in direct tourist income. So if the wildlife is lost from the Gulf coast how many billions of dollars will not be spent by visitors that will have no reason to come?

If BP put more effort into sorting out the problem instead of spreading propaganda, then I could understand the investors complaining. But BP has caused this problem and it is up to BP and its investors to pay the bill.