RDN et al: BP & Deepwater Horizon’s long term effects
Regular readers will know that in 2010 I risked saying that BP’s catastrophic accident and spill at its Deepwater Horizon drill in the Gulf of Mexico might not be as dire for the environment, the oil industry or BP as was being predicted at the time. I was thrilled to be asked to contribute to a Voice of Russia (VoR debate: Has BP paid the price for oil spills?, 10 December 2013) panel discussion on these themes….
My 2010 comments, in a letter to the FT, were of course premature but they didn’t affect to be predictions, and on the whole one shouldn’t be afraid to be salutary. Naturally, I have since taken a sharp and anxious interest in the fall-out of the accident.
My point had been that, historically, no other oil spill had produced the awesome damage always predicted at first. Nearly four years on, I am surprised how hard it is to get a cool summation of the spill’s effects, especially on BP. That is, until VoR asked Nat Krasnoff, a business claimant against BP; Paul Stock, an oil consultant and solicitor; Malcolm Graham-Woods, an oil and gas investment expert (and me) to discuss these things with Brendan Cole, their knowledgeable presenter. (More from Mr Malcolm-Woods, and very interesting, is here: Is BP still an oil major, Interactive Investor, iiTV, 3 December 2013?.)
The bottom line seems to be that Nat is a victim of a highly litigious system as much as of BP; and that the spill intensely compounded several other BP troubles in the US and Russia, which have indeed transformed the firm but by no means terminally, so far. There is some serious FT commentary which suggests that though BP is smaller than it once was, several other majors are heading in the same slimmer direction, and that – perhaps surprisingly – BP remains a respectable (I mean viable) investment prospect.
It seems likely that the oil industry is a bit safer as a consequence of the spill, but that – quite rightly – it is pressing on with inherently tricky technologies; that oil and gas remain as important as ever; that the coast of the Gulf is probably returning to pre-spill normality fairly well and that in parts remedial work will maybe improve its status.
And of course it is important to remember the human toll in deaths and suffering of BP’s activities in the US prior to 2010, and I am glad Malcolm did so in the debate.