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Why BP’s Cleanup Performance Sucks – A Theory

July 3, 2010

An interesting conversation between Robert F. Kennedy Jr. and Keith Olbermann shed some light as to why BP isn’t doing a such a great cleanup job (to put it midly).   I have included a segment of the transcription (7/1/2010). 

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Olbermann: …. and he’s [RFK] currently involved in three lawsuits against BP. … One long class action suit in Louisiana that’s on behalf of commercial and recreational fishermen.  The second is a similar suit in Florida.  And the third is RICO (Racketeer Influenced Corrupt Organizations) actions to hold BP accountable for the false assurances it gave that it could handle a worst-case deepwater disaster. … “The Associated Press” revealed that nearly half of the judges, the federal judges in the Gulf, have financial interests in the oil and gas industry.  Do you worry how that might impact any legal progress you might be able to make against them?

Kennedy:  Well, you know, there’s an ethical prohibition against attorneys like myself criticizing judges.  And I actually wouldn’t want to be in front of a judge who I has accused of corruption on your television show.  But I think any attorney – all the attorneys who are involved in this litigation – and there are a number of them – are mindful of the fate of the Exxon Valdez litigation.  So, it’s not just in Louisiana, Mississippi, Alabama and Florida.  But at the highest levels of our government, in the U.S. Supreme Court, there’s an ideological, let’s call it sympathy, for large corporations.  And that in the Exxon Valdez situation, the judges consistently undermined and cut back jury verdicts against Exxon.  In the state, in some of the gulf States, and I lived in Alabama for two years.  I have a tremendous affection for people in the Gulf.  I’ve spent lots of time in all those states.  But in states like Louisiana, you have a situation where virtually every organ of government has been captured by the oil industry, whether it’s the – through a phenomenon called regulatory capture, the agencies that are supposed to protect Americans from pollution actually end up as kind of sock puppets for the industries that they’re supposed to regulate.  …

Olbermann:  The idea at the heart of the RICO action, as best I understand as a layman, is that BP could not handle a disaster of this magnitude yet gave false assurances that it could.  Can any other oil company that’s doing this kind of drilling actually handle a disaster of this magnitude?  In other words, legally or otherwise, what is there to prevent this happening again?

Kennedy:  Well, I don’t I don’t think anybody has come up with an idea for stopping the disaster as it is configured today, as it’s postured today.  Certainly, there are things they could have done better.  They could have multiplied the number of blowout preventers that they have at the site.  They had one.

And their own internal studies – despite their assurance to the government – BP’s own internal studies, showed that a blowout preventer at that – under that kind of pressure, under 5,000 feet of marine pressure, would work only 45 percent of the time.  So, what they were betting, that in 55 percent of the time, they knew when they did this operation, that in 55 percent of the time, they have a 55 percent chance of failure of this kind.  And that’s a bet they didn’t tell the government or the American people.

You know, one of the thinks I would say, Keith –

Olbermann:  Yes.

Kennedy: — that people should keep in mind, and particularly the media and the Coast Guard and federal agencies, is that BP at this point, has huge economic disincentives to actually deploying the kind of resources that it ought to deploy to clean up the site.  Each barrel of oil that it removes from the ocean today costs the company approximately $100,000.  But it does nothing – removing that drum will do nothing, that single drum of oil will do nothing to reduce the onshore liability, which is going to be the real liability for BP.  The big liability is going to come from economic damages to property holders, to shrimpers, to fishermen, to banks, to hotels, and to small businesses onshore.  In the Exxon Valdez case, Exxon removed 8 percent of the oil.  They spilled 11 million gallons.  They only removed 1 million.  And part of the reason for that is the company really doesn’t want to remove them.  It wants to appear like it’s out there trying to remove them.  But every barrel it removes comes – cuts money, $100,000 from its bottom line.

Olbermann:  My goodness.

Kennedy:  So – and it doesn’t commensurately the liability of the company by $100,000 onshore, probably not even $1.  So, via BP’s best bet at this point is to hide the oil, which it’s been doing, using these dispersants, which are – you know, are dangerous on their own, but are much more dangerous when you combine them with the oil.  They force the oil to sink so the public doesn’t see them.

Olbermann:  Right.

Kennedy:  Number two, by lying about the amount of oil that’s actually coming from the pipe, which they’ve been doing since day one.  BP publishes a magazine called “Pioneer.”  It’s an internal trade magazine.  And in 2008, BP bragged to its shareholders and to investors in the oil industry that it had a proprietary technology that could accurately count to the gallon, every single gallon of oil emitting from a pipe.  But this – from the beginning, they’ve refused to deploy that technology at the Gulf oil spill, at the Deep Horizon site.  Why?  Because part of their legal strategy, their best bet, under the market forces that they’re operating, is to simply say that, you know, that this is a very, very minor spill.  But – and then – and then to not really deploy the kind of resources that they ought to be deploying to clean it up  They’ve ignored the fact that about nine European nations have huge fleets of skimmer ships that all want to get over here.  And, you know, many, many other ways they could be cleaning up this spill that BP is not doing.  The Coast Guard really ought to be forcing them to use these resources.

Olbermann:  Yes, each gallon cleaned up is another piece of evidence, too.

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2 Comments leave one →
  1. jasondylan permalink
    July 5, 2010 4:31 am

    Great job. Very important guy and organization, Bobby jr.

    check me out for more on this stuff.

    jasondylan

    • July 5, 2010 4:18 pm

      Thank you for your comment! I ventured to your blog — which is great! Stay in touch!

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