BP liability capped at $75 million of damages for oil spill

[Genx87]

Unless this is an act of God the cap doesnt apply.

 

[lothar]

Why should BP be the only company that bears responsibility for this disaster?

1.) Transocean Ltd., built and operated the Deepwater Horizon rig...

2.) Cameron International Corp., maker of a fail-safe device on the well intended to prevent spills...

3.) Halliburton provided a variety of services, including cementing, on the rig. Cementing is a method of capping a well to control pressure from oil and gas beneath the seabed....


Look, I know it's fine and dandy for people to naturally blame "Big Oil" and they're natural targets for politicians(companies that post billions in profits are natural targets) for the public due to envy, among other things.

 

[Zorba]

Why should BP be the only company that bears responsibility for this disaster?

1.) Transocean Ltd., built and operated the Deepwater Horizon rig...

2.) Cameron International Corp., maker of a fail-safe device on the well intended to prevent spills...

3.) Halliburton provided a variety of services, including cementing, on the rig. Cementing is a method of capping a well to control pressure from oil and gas beneath the seabed....


Look, I know it's fine and dandy for people to naturally blame "Big Oil" and they're natural targets for politicians(companies that post billions in profits are natural targets) for the public due to envy, among other things.

I am sure they will all get lots of blame, fines and lawsuits, even if the investigation proves that they were not at fault. But, BP as the head contractor is responsible for everything that happens at their site. If the equipment was bad, they should not have selected it, etc.

This is just like if an Airline pays another company for maintenance and that company installs the incorrect part, the FAA will come down on the Airline not the maintenance facility.

 

[ElFenix]

Why should BP be the only company that bears responsibility for this disaster?

1.) Transocean Ltd., built and operated the Deepwater Horizon rig...

2.) Cameron International Corp., maker of a fail-safe device on the well intended to prevent spills...

3.) Halliburton provided a variety of services, including cementing, on the rig. Cementing is a method of capping a well to control pressure from oil and gas beneath the seabed....


Look, I know it's fine and dandy for people to naturally blame "Big Oil" and they're natural targets for politicians(companies that post billions in profits are natural targets) for the public due to envy, among other things.

BP probably only had one person on the rig at any given time. oh sure, there might be visits from others. but probably all of this is contracted.

 

[tk149]

It's not a game. And yes, rules get changed in midstream, that's one of the rules.

Are you condoning changing the rules mid-game? Will you feel the same way when it's your turn?

Nevermind the consequences of chilling any further business activity (not just oil-drilling related).

 

[tk149]

Goldman Sachs apparently made a killing by shorting Gulf of Mexico oil one day before the disaster...

http://www.huffingtonpost.com/andy-borowitz/goldman-sachs-reveals-it_b_558774.html

Of course, they are supposed to make money by taking calculated risks like this that pay off...

Are you taking that story seriously? Here's another Borowitz story (on his home page today)
http://www.borowitzreport.com/

Greece Offers to Repay Loans with Giant Horse

Steed Wheeled Into Brussels at Night

BRUSSELS (The Borowitz Report) – In what many are hailing as a breakthrough solution to Greece’s crippling debt crisis, Greece today offered to repay loans from the European Union nations by giving them a gigantic horse.
Finance ministers from sixteen EU nations awoke in Brussels this morning to find that a huge wooden horse had been wheeled into the city center overnight.
The horse, measuring several stories in height, drew mixed responses from the finance ministers, many of whom said they would have preferred a cash repayment of the EU’s bailout.
But German Chancellor Andrea Merkel said she “welcomed the beautiful wooden horse,” adding, “What harm could it possibly do?”
Elsewhere, two days after the White House Correspondents’ Dinner, the Pakistani Taliban took responsibility for Jay Leno’s act. More here.
The Los Angeles Times says Andy Borowitz has “one of the funniest Twitter feeds around.” Follow Andy on Twitter here.

 

[heyheybooboo]

Just like they had a plan for "what would we do if a Cat 5 hurricane comes and destroys New Orleans."?

FEMA's 'Pam' Simulation Foretold Katrina Disaster
Preparedness action plans not implemented in time





--

 

[lothar]

Are you condoning changing the rules mid-game? Will you feel the same way when it's your turn?

Nevermind the consequences of chilling any further business activity (not just oil-drilling related).

When health insurers and credit card companies do that, he's opposed to that practice.
When government does it, he automatically supports it.

Don't mind him.

 

[JSt0rm]

Unless this is an act of God the cap doesnt apply.

hey genx,

I believe you but do you have a source for this? That would be great news if true.

 

[HumblePie]

Are you taking that story seriously? Here's another Borowitz story (on his home page today)
http://www.borowitzreport.com/

LOL yah, meant to respond back earlier but got tied up at work. I also checked that story linked by the poster and thought that it was horrible. Until I realized it was a comedy satire and not a true story.

 

[LTC8K6]

Are you taking that story seriously? Here's another Borowitz story (on his home page today)
http://www.borowitzreport.com/

Come on! Goldman Sachs bait should have been a sure bet here.

 

[Darwin333]

OK moron! That's great, but if your in the oil business shouldn't you have some sort of plan?

I mean, the army corps of engineers doesn't expect the dam to burst any time soon but if it did spring a leak you better believe that there is a PLAN for that.

LOL, what a horrible example. A few years back what was the Army Corps of Engineers "plan" if one of their levees broke?

I do agree that they should have a plan, its the actual preparation and assets that are the real issue. A plan is great but if you don't have the assets in place to put the plan into motion its just words on paper. The assets required to respond and contain the mess we currently have are insanely expensive, even for big oil, and the chances of the plan being needed are very very low. Therein lies the problem, the consequences are huge but the risk of it happening are very low.

I actually like the original law (cap should still be raised from $75M). The Government collects a tax on every barrel of oil and places it into a fund to respond to situations like this. They should probably double the 8 cents a barrel because under $2B isn't nearly enough for the total damage this spill will cause but another 8 cents per barrel doesn't sound unreasonable.

My question is, are the the funds being used as intended? This is the first I have heard about it.

 

[HomerJS]

People here who are attributing any blame to the federal government are the same ones screaming get government out of businesses way and the private sector will take care of things.

The federal government has responsibility for intervening in natural disasters. The feds don't have the resources nor do righties want them taking over all private industry accidents.

I cant say this enought times...

BP is responsible
BP is responsible
BP is responsible
BP is responsible
BP is responsible

 

[werepossum]

LOL, what a horrible example. A few years back what was the Army Corps of Engineers "plan" if one of their levees broke?

I do agree that they should have a plan, its the actual preparation and assets that are the real issue. A plan is great but if you don't have the assets in place to put the plan into motion its just words on paper. The assets required to respond and contain the mess we currently have are insanely expensive, even for big oil, and the chances of the plan being needed are very very low. Therein lies the problem, the consequences are huge but the risk of it happening are very low.

I actually like the original law (cap should still be raised from $75M). The Government collects a tax on every barrel of oil and places it into a fund to respond to situations like this. They should probably double the 8 cents a barrel because under $2B isn't nearly enough for the total damage this spill will cause but another 8 cents per barrel doesn't sound unreasonable.

My question is, are the the funds being used as intended? This is the first I have heard about it.

Corps of Engineers DID have a plan for a CAT 5 hitting New Orleans. The politicians took a look and said "Crap, we can't afford THAT!" So the "worst case" got demoted to a CAT 3, hold the storm surge please.

I like that plan, somewhat. Whether it is each company holding money in escrow, the industry pooling its resources to set up an emergency response fund, or government setting a special tax, money and resources need to be pre-positioned for a disaster (and either way, the consumer ultimately pays in higher energy costs, which is as it should be.) Katrina shows the problem with government holding the money though. Remember all the statues and fountains and Mardi Gras paraphernalia and roads to river boat casinos built with the money allocated for levee maintenance? Anybody seen any government equipment sailing out on Day One? When government (at almost any level) takes control of a rainy day fund, every day becomes a rainy day and when needed, the money must be made up with new taxes and/or borrowing. Any politician above the local level who could be trusted with such sums would probably be quickly voted out of office anyway.

 

[lothar]

Why should BP be the only company that bears responsibility for this disaster?

1.) Transocean Ltd., built and operated the Deepwater Horizon rig...

2.) Cameron International Corp., maker of a fail-safe device on the well intended to prevent spills...

3.) Halliburton provided a variety of services, including cementing, on the rig. Cementing is a method of capping a well to control pressure from oil and gas beneath the seabed....


Look, I know it's fine and dandy for people to naturally blame "Big Oil" and they're natural targets for politicians(companies that post billions in profits are natural targets) for the public due to envy, among other things.

Was negligence caused by BP themselves or Haliburton, which did a cementing operation 12 hours before the accident?
Was negligence caused by BP themselves or Cameron International Corp., maker of a fail-safe device on the well intended to prevent spills?
Was negligence caused by BP themselves or Transocean Ltd., which built and operated the Deepwater Horizon rig?

I have yet to see any evidence of negligence on BP's part at least.

Interesting fact: 18 of 39 deepwater drilling accidents have been attributed to cementing operations alone.
http://www.cbsnews.com/stories/2010/05/24/national/main6513934.shtml

The government should have all 4 companies involved put money in an escrow account, investigate the cause of the accident, and then payback/release money to those not involved after the investigation has been concluded.

Shares of Halliburton (HAL) plunged nearly 15% on Thursday after test results released about the Halliburton cement used in BP’s (BP) Macondo well in the Gulf of Mexico showed signs of instability and the cement may have acted as a contributing factor to the April 20 explosion that led to the largest maritime oil spill in U.S. history.

The test results were laid out in a letter sent by government researchers to the White House's commission investigating the BP oil spill. If backed up with additional evidence, the government tests would bolster BP’s claims the cement in the Macondo well was a contributing factor to Deepwater Horizon's blow-out.

The commission conducted tests on Halliburton's cement mixtures with the help of facilities, equipment and researchers provided by ChevronCVX). In its tests, Chevron said "its lab personnel were unable to generate stable foam cement in the laboratory using the materials provided by Halliburton and available design information regarding the slurry used at the Macondo well."

It also appears that Halliburton was possibly aware that the cement it was providing to BP was not adequate. According to the letter, Halliburton conducted four of its own foam-stability tests on slurry mixtures for the well before the explosion. The first two tests done in February used a slightly different cement recipe than the one used in the BP well, while the two tests in April used the actual cement recipe that went into the BP well.

Only one of Halliburton's four tests - one of the tests done in April - showed the cement mixture would be stable, the letter said.
It also appears that Halliburton did not expressedly BP about the test results, according to the commission's letter. BP potentially could have pumped the Macondo well with Halliburton’s instable cement mixture without knowing if that cement was stable or not.

“Although laboratory foam stability tests cannot replicate field conditions perfectly, these data strongly suggest that the foam cement used at Macondo was unstable," according a letter sent to the commission. "This may have contributed to the blowout."

BP has long claimed that its partners with the Deep Water Horizon – Transocean (RIG) and Halliburton - were negligent in their responsibilities in the well and should be held partially responsible. In September when BP released the results of its own internal investigation, BP said that the well’s cement wall did not hold.

If proven, those claims would run counter to Halliburton’s claims that the cement mixture it provided to BP was stable and not a contributing factor the April 20 explosion.

Any damaging data about Halliburton's cement do not relieve BP or Transocean of their responsibilities, the commission said. According to the letter, cement mixtures can fail pretty regularly and the industry has developed several tests to check whether a cement mixture has taken hold. Those tests such as the "negative-pressure test" were done by BP staff.

Further Halliburton provided to BP in March test data regarding the cement containing the results of the February test in it. The letter said that BP did not express any concerns about the cement at that time.

Shares of BP rose 2% on the news, possibly on a bet that Halliburton may have to shoulder some financial responsibility, while Halliburton shares dropped 14% on heavy volume to $31.23 a share.

http://www.reuters.com/article/idAFN2810167720101028?rpc=44
http://www.foxbusiness.com/markets/...-used-bp-unstable-contribued-blow-commission/
http://www.bloomberg.com/news/2010-...after-problems-found-with-bp-well-cement.html

There ya go...

 

[Darwin333]

Bah, didn't check the date of the post.

 

[JSt0rm]

interesting.

 

[Acanthus]

This aside, can BP the company actually cover the costs of this clean up effort? They could eventually run into the many billions. Can BP really cover that, I don't know how rich they are.

EDIT: OK they look to be worth about $150 B or something.

Or rather were the stock has been hit pretty bad by this.

They have shitloads of hard assets they could easily move.

I believe they were cutting a deal with Apache to raise a few billion the last time i checked.