gunDriller
12th June 2010, 12:21 PM
Thinking some more about Who Benefits.
1. Nalco
The makers of the oil dispersant Corexit.
Corexit is a tool that poisons the ocean to reduce the oil that is visible on the surface. It's basically a Public Relations tool for BP - a terrible one, but one that minimizes those pictures of pelicans covered in oil.
2. The Insurance Industry.
It is now obvious that BP was beyond reckless in their operation of the rig, and that that recklessness overrode whatever corporate culture of safety that the contractor, Transocean, may have had.
The more I read about the period of time up to the explosion and the next 1 hour, the more obvious it becomes that BP eliminated numerous safety steps, against the advice of their crew, while drilling into a humongous oil reservoir with a pressure of 70,000 psi.
That is Beyond Stupid.
However, as many have pointed out, the safety record of the deepwater industry was near perfect - until this accident.
So that what will happen now is, insurance rates will go up.
BUT the industry will get a new dose of Carefulness that will hopefully last for a while.
So the insurance industry is unlikely to have a pay-out.
Insurance premiums up - pay-outs non-existent because the industry is following normal safety procedures and not ignorring the advice of their best engineers - that is a recipe for $$ - Big Profits.
Is the oil industry actually sick enough to push their rig operation to the point where an accident was predictable, knowingly sacrificing the health of an entire ocean ?
This disaster will result in clean-up and lawsuit costs that have the capability to bankrupt BP.
So although a financial motive for the disaster has some arguments in its favor, and since I think the true cost of the disaster exceeds $1 Trillion US, it still looks like BP is on the hook for maybe $50 billion, enough to push them into bankruptcy.
Why would the money behind BP sacrifice a cash cow like BP, costing them maybe $50 Billion, when the disaster business part of it (dispersant sales, insurance) is more in the $10 Billion range.
One effect of the disaster is that it will make land-based operations that much more profitable. For example, Iraq has 110 Billion barrels of proven reserves with a low-recovery cost ($5 a barrel). At $75 a barrel, that's 110 Billion x $70 = $7.7 Trillion.
Who controls Iraq ? Who brought us the Iraq war and the attack that was used to justify the Iraq war/occupation ?
Israel and their proxy, the US.
So ... how much does this disaster increase the relative value of the Iraq oil reserves (and the Iranian oil reserves, for that matter) ?
I'm afraid that I do see a financial incentive for the Deepwater Horizon disaster, a financial incentive larger than BP. That is, the increase in value of the Iraq oil reserves.
1. Nalco
The makers of the oil dispersant Corexit.
Corexit is a tool that poisons the ocean to reduce the oil that is visible on the surface. It's basically a Public Relations tool for BP - a terrible one, but one that minimizes those pictures of pelicans covered in oil.
2. The Insurance Industry.
It is now obvious that BP was beyond reckless in their operation of the rig, and that that recklessness overrode whatever corporate culture of safety that the contractor, Transocean, may have had.
The more I read about the period of time up to the explosion and the next 1 hour, the more obvious it becomes that BP eliminated numerous safety steps, against the advice of their crew, while drilling into a humongous oil reservoir with a pressure of 70,000 psi.
That is Beyond Stupid.
However, as many have pointed out, the safety record of the deepwater industry was near perfect - until this accident.
So that what will happen now is, insurance rates will go up.
BUT the industry will get a new dose of Carefulness that will hopefully last for a while.
So the insurance industry is unlikely to have a pay-out.
Insurance premiums up - pay-outs non-existent because the industry is following normal safety procedures and not ignorring the advice of their best engineers - that is a recipe for $$ - Big Profits.
Is the oil industry actually sick enough to push their rig operation to the point where an accident was predictable, knowingly sacrificing the health of an entire ocean ?
This disaster will result in clean-up and lawsuit costs that have the capability to bankrupt BP.
So although a financial motive for the disaster has some arguments in its favor, and since I think the true cost of the disaster exceeds $1 Trillion US, it still looks like BP is on the hook for maybe $50 billion, enough to push them into bankruptcy.
Why would the money behind BP sacrifice a cash cow like BP, costing them maybe $50 Billion, when the disaster business part of it (dispersant sales, insurance) is more in the $10 Billion range.
One effect of the disaster is that it will make land-based operations that much more profitable. For example, Iraq has 110 Billion barrels of proven reserves with a low-recovery cost ($5 a barrel). At $75 a barrel, that's 110 Billion x $70 = $7.7 Trillion.
Who controls Iraq ? Who brought us the Iraq war and the attack that was used to justify the Iraq war/occupation ?
Israel and their proxy, the US.
So ... how much does this disaster increase the relative value of the Iraq oil reserves (and the Iranian oil reserves, for that matter) ?
I'm afraid that I do see a financial incentive for the Deepwater Horizon disaster, a financial incentive larger than BP. That is, the increase in value of the Iraq oil reserves.