BP and taxpayers

I am surprised as well. But I'm also confused as to why BP is being held totally responsible for the spill and the clean up. Was it not a US company that operated the well and another US company that built the kit that broke? Why are we not pooling resources to do whatever's necessary and arguing about blame later? Or am I just being naive here?

Estimates of the amount of oil spewing daily into the ocean have just been raised to 60,000-80,000 barrels per day. This is an unmitigated disaster.

One US commentator has said this is now far more than an environmental disaster - it is an environmental calamity. In addition to the environmental/wildlife consequences, it could also cause major consequences with respect to real estate, food production, weather, etc.

TBH, I'm a bit amazed there isn't a current thread running on this. Why not? Doesn't the Mumsnet community have an opinion?

Here is part of an interview (released today) with an expert who predicts bankruptcy (Chapter 11) for BP:

"What do you think is in store for the future of BP?

They have about a month before they declare Chapter 11. They're going to run out of cash from lawsuits, cleanup and other expenses. One really smart thing that Obama did was about three weeks ago he forced BP CEO Tony Hayward to put in writing that BP would pay for every dollar of the cleanup. But there isn't enough money in the world to clean up the Gulf of Mexico. Once BP realizes the extent of this my guess is that they'll panic and go into Chapter 11."

Full article here:

money.cnn.com/2010/06/09/news/companies/simmons_gulf_oil_spill.fortune/index.htm

MadameCastafiore - well, your dh may know best but I've got one thing to say to him ' AIG '. Two years ago no one thought that firm could fail either, and look where it is today. Barely functioning. No dividend. Shares worth a tiny fraction of what they were worth in June 2008.

FWIW, the share price of BP stock is down 14% today alone in America. I sold most of my stock a month ago, thankfully. Think I will unload the final 100 shares today while they're still worth something......

Summary from article in current issue of Rolling Stone magazine:

"'The good news is that the oil cap is collecting more oil than expected?about 15,000 barrels a day. The bad news is that this means much more oil is spilling from the leaking geyser than has been estimated. How much exactly? A new Rolling Stone article has some scary numbers: According to the magazine, the official estimate of 12,000 to 25,000 represents just the ?minimum estimate.? The scientist Timothy Crone, who consulted with the government, said it could be as much as ?100,000 barrels a day.? The median for the scientist?s calculating is 55,000 barrels a day??the equivalent of an Exxon Valdez every five days.? ?That?s what the plume team?s numbers show too,? says Crone, and Rolling stone notes that ?the industry privately agrees with such estimates.?

lessors sorry, not lessees

Why it doesn't make sense is that the rig is an asset on a lease, and the lessees have no input in the operation of the rig therefore there can be no 'pull' in the opposite direction in the way the article describes

DH is a fund manager in the pensions arm of a major US bank - he is of the view that this is fill your boots time not get worried time.

He actually sat and laughed for a while at some of the !

I did a presentation on this last week and my feeling then and now is that BP will eventually sell its North American oil assets as it will find too much political opposition to it being allowed further drilling licences in the US.

I do not think BP will go bankrupt OR need to be rescued though. The estimated cost of this is $20 bn spread over several years and some of it will be borne by insurance and the operators of Deepwater Horizon. All that will be fought out in court over several years.

Pension funds have been hit hard by this and I do think it likely that BP will cut its dividend in the end. The much bigger threat to BP (and other oil companies) is a future drop in oil prices. I would certainly consider it a buy after the oil price has dropped and when absolutley no one wants the shares.

All politicians in the US are playing politics with this issue as it is a UK company and it is the mid term elections. Things should calm down once the well is under control (possibly in about 3 months time) and the mid term elections are over.

I feel sorry for Tony Hayward (CEO of BP) as it could have happened to any company.

I did a presentation on this last week and my feeling then and now is that BP will eventually sell its North American oil assets as it will find too much political opposition to it being allowed further drilling licences in the US.

I do not think BP will go bankrupt OR need to be rescued though. The estimated cost of this is $20 bn spread over several years and some of it will be borne by insurance and the operators of Deepwater Horizon. All that will be fought out in court over several years.

Pension funds have been hit hard by this and I do think it likely that BP will cut its dividend in the end. The much bigger threat to BP (and other oil companies) is a future drop in oil prices. I would certaily consider it a buy after the oil price has dropped and when absolutley no one wants the shares.

All politicians in the US are playing politics with this issue as it is a UK company and it is the mid term elections. Things should calm down once the well is under control (possibly in about 3 months time) and the mid term elections are over.

I feel sorry for Tony Hayward (CEO of BP) as it could have happened to any company.

How does it not make sense that someone who rents rigs for a living would not want to rent it for longer?

That article doesn't make sense to me, Earlybird

Am no expert in the field, but I've done a couple of projects for Oil & Gas companies, and what generally happens is that a rig-owner (here Transocean, I think) leases a rig to a rig operator (here BP). Transocean would have nothing whatsover to do with the operation of the rig. Simply because it is paid a daily rate for leasing the rig doesn't mean at all that it had any impact upon the way in which it was operated.

So that article makes no sense to me. All it tells me is that the writer doesn't know much about Oil and Gas

Summary from an article in today's New York Times which states that no one (company or regulator) had overall responsibility for the safety of the rig:

''The Deepwater Horizon rig operated under the hazy authority of multiple corporations and regulators, with no one in charge of safety, The New York Times reports. Regulations for offshore drilling have evolved in a piecemeal way, with the few deepest drillers getting many exemptions to safety procedures adopted for drilling in shallower waters. Regulators appear to have given little attention to BP?s emergency spill plan?the documents contained a link to an Asian shopping site and mentioned protecting walruses, creatures not too common to the gulf. Rig workers described a conflict between BP, which made more cash by drilling faster, and Transocean, paid by the day, which made more money by drilling slower. And costly delay in drilling led to missed signs of danger: A Halliburton worker fretted about cement use, another about casing quality. At the same time, regulators granted BP a pass in testing its blowout preventer.''

jabberwocky, we all live in an oil hungry world, one of my best friends works for friend of the earth and finds it ironic how high his job commits him to flying so much and contributing to the never ending demand for oil, governments can make it very difficult for companies to do business there and the result is the big players move out when the oil price is low, leaving the small guys to run it and go under as soon as there is a problem, I am not blaming the locals who are suffering at the hands of the oil spill, just being realistic, if you want oil companies to continue to work in your country you cant make it too hard for them, I agree transocean has to be brought into it.

It's interesting to see that Transocean and Haliburton get so few mentions in the press. I'm sure that the rig operator must primarily be to blame, but I'm equally sure that BP's lawyers will be looking carefully at the equipment suppliers...

Clueless, I really hate to see this go into a Blame the Victim/Bash America thread. The US, particularly now that we have gotten Bush-the-oil-president out and Obama in, has made strides towards becoming less dependant on oil. Yes, it's taken too long and it will take longer still but there are many, many Americans committed to reducing our dependency on oil. And I don't think there is any question of whether we will want BP to clean up their mess. Their rig, their responsibility. Sure we'll bring in transocean and halliburton too but BP is not going to get off the hook.

I think the first thing that would happen is obama would force bp out of america, he cant admit that the americans love of oil hungry lifestyle cant be sustained whilst being overly harsh on all oil companies, bp become the scapegoat, bp have enough assets outside of america to continue, its just whether america want them to pay for the clean up costs or not.

Not old lady type investments of squirrelling away a few shares. No that's really not my game. I'll be in and out with a profit before the old dear has got off the phone to her broker ;-)

Sorry, I misread your post. Did he really actually say Plug the hole? Rather out of character. But still, we are used to him dealing with things in a calm manner so getting excited and passionate would still have seemed weird.

Obama is not the kind of politician who gets emotional. "Plug the damn hole" would have sounded ridiculous coming from him.

There are a lot of companies that were thought to be too big/rich to go bankrupt. I really don't see BP surviving this long-term but it will be quite a while before it actually goes under. Buying shares would not be my first choice.

Looks like investing is not your game, alouiseg. Better to have a bath instead.

"a buying opportunity".

Anyone heard that quaint old expression about bottom pickers getting smelly fingers?