Hmmmm....lets see. $20B that would ahve been profit....now it's not. Yeah, that was probably their plan. I don't know why all the corp.'s aren't doing it.:innocent:Quote:
Originally Posted by BENESSE
Printable View
Hmmmm....lets see. $20B that would ahve been profit....now it's not. Yeah, that was probably their plan. I don't know why all the corp.'s aren't doing it.:innocent:Quote:
Originally Posted by BENESSE
KTT - I scan the headlines a few times a day and then research those items that peak my curiosity or interest. I seek out conflicting thoughts on a subject so I can see both sides of the issue. If I read an article that is in favor of banning deep water drilling then I also look for one that supports it. If I have a strong opinion on a subject then I look for strong opinions counter to mine. I think it's dangerous to only look for documentation that supports your line of thought. How can you learn from that? You can only have a real opinion once you've examined all sides of an issue and understand the pros and cons.
The other thing you have to do is think through the issue. Early on I read that BP might spend upwards of $20B on this spill. I wondered what they expected to net this year and how that would impact their bottom line. It isn't just BP that gets impacted, it's also shareholders, you and me. I was surprised to find analysts projected a $20B profit this year. Then I was curious how they would set up the pay out since no company would want to wipe out their profit margin. On the same day, they announce a four year pay out ($5B per year) and they cut dividends. Actually, pretty brilliant on their end to negotiate that type of payout since the time value of money means they pay out less each year considering inflation. They aren't paying out $20 Billion in today's dollars. Add to that the fact that cutting the dividend payout means they hold on to all the cash they would have paid out. Coupled with tax right offs that are into the Billions almost ensures a profit this year. On top of the country's largest environmental disaster!!! So now watch three things....deep water drilling ban, which I've already said will be lifted in the near term, punitive damages, and BP advertising. Those are the three things I'll be looking at ongoing.
That's a bit how my thought process works. Just try to see both sides of the issue so you can understand it and think through what it means when you read X. Then research it.
Thank you for that outline, Rick. Educational and clear about where things stand at the moment. I do hope people absorb it, think about it and keep an open mind before they start shedding tears for BP and the end of life as they only know it.
I'm honestly not worried about BP. I do however want them to be profitable in order to pay all real claims and clean-up costs. Right now it is the shareholders that are taking the hit. Many of those shares are held in retirement accounts.Quote:
Originally Posted by BENESSE
Same here....I just hate seeing people ignore the gov'ts mis-handling of this disaster, and the results of their actions. They are either incompetent, or they have an agenda. If you look at who can really gain from this mess, it paints an ugly picture. (And it ain't BP.):innocent:Quote:
Originally Posted by crashdive123
I know...it was all masterminded by pelicans in order to get a free bath.Quote:
Originally Posted by 2dumb2kwit
Crash, check out Rick's post #271.Quote:
Originally Posted by crashdive123
Doesn't sound like the retirement accts. are in any imminent danger. As for shareholders, well that's the risk you take when you invest in anything.
No doubt about it, 2D. They mishandled it in a big way and stupidly refused all help that was immediately offered. No excuses there. NONE.Quote:
Originally Posted by 2dumb2kwit
Pension funds investing in BP and individuals that rely on dividend payout are taking a hit. Not doubt about it. BP reached a high of 62.58 in January and they are trading at less than $32 today and now BP is not paying a dividend. My reference was that BP would not be dipping into their pension funds to pay for the clean up. Not in the U.S. anyway. I probably should have clarified that.
Quote:
Originally Posted by BENESSE
Quote:
Dutch to Provide Assistance in Clean Up of Gulf Oil Spill
Press release | 28 May 2010
At the request of U.S. authorities, the Dutch Minister of Transport, Camiel Eurlings, has offered three sets of sweeping arms (6 arms in total) and auxiliary equipment to be used to collect oil spilled from the Deepwater Horizon incident, in the Gulf of Mexico.
Complete Press release,Quote:
The U.S. and the Dutch are working closely together on water related issues. Immediately after Hurricane Katrina and Rita struck, the Netherlands provided assistance in battling flood waters in New Orleans. Senator Mary Landrieu and EPA Administrator Lisa Jackson recently visited the Netherlands to discuss these issues. The Dutch and American collaboration continues to evolve and makes the Netherlands the U.S. go-to partner for water management solutions, working together on flood protection in Louisiana and other states, mitigating the impact of rising sea levels on America’s coastlines and developing partnerships that prepare our economies for short and long-term water challenges.
http://dc.the-netherlands.org/News/P...Gulf_Oil_Spill
Yeah, but did you miss the part about them offering ships already outfitted with those booms, (and a bunch of other help.) three days after the explosion?Quote:
Originally Posted by Justin Case
Yes, I know, I just seen this PR and thought I would share it.Quote:
Originally Posted by 2dumb2kwit
Oh...good.....for a minute there, I thought I might have to Gibbs smack you. LOL (You know...Gibbs.....NCIS.)LOL:innocent:Quote:
Originally Posted by Justin Case
Debunking the Fox News Obama International Aid Oil Spill Lie
http://www.politicususa.com/en/obama-international-aid
So the Dutch officials lied about it, as did many other sources. And we are supposed to believe this because some guy named Jason Easley, said so......with out any supporting evidence.......while blogging on a site calledQuote:
Originally Posted by Justin Case
Yeah.....OK.:innocent:Quote:
Politicususa
Real Liberal Politics
LOL,, It is what it is :innocent:
Quote:
Originally Posted by Rick
I have posed the question of BP's future in Alaska on another forum that has a lot of Alaska oil patch members. If they file bankruptcy or are forced in same, or if they are so asset depleted (cash poor) after the Gulf experience, they will not be growing and expanding in Alaska.
There are other companies with a much better record who'd be chomping at the bit to replace BP if need be. We won't be seeing the end of drilling in our lifetime, I'm afraid.Quote:
Originally Posted by Sourdough
Want to hear something scary? BP has been fined by OSHA (Occupational Safety and Health Administration) 760 times. By contrast, oil giant ExxonMobil has been fined only once.
As The Stock Masters say: How is BP even allowed to operate?
Let's take a look back at BP's horrid track record, courtesy of ABC News:
* Back in 2007, a BP pipeline spilled 200,000 gallons of crude into the Alaskan wilderness. They got hit with $16 million in fines.
* "The Justice Department required the company to pay approximately $353 million as part of an agreement to defer prosecution on charges that the company conspired to manipulate the propane gas market."
* In two separate disasters prior to Deepwater Horizon, 30 BP workers were killed and more than 200 have been seriously injured.
* "According to the Center for Public Integrity, in the last three years, BP refineries in Ohio and Texas have accounted for 97 percent of the "egregious, willful" violations handed out by OSHA"
* OSHA statistics show BP ran up 760 "egregious, willful" safety violations, while Sunoco and Conoco-Phillips each had eight, Citgo had two and Exxon had one comparable citation.
After examining the facts, we're inclined to agree that BP probably shouldn't be operating here in the U.S. considering its horrific safety record.
http://www.businessinsider.com/bp-ha...-safety-2010-6
Regardless of their record, B...the administration still gave them special exemptions.
http://globalresearch.ca/index.php?context=va&aid=19027
"Last year the Obama administration granted oil giant BP a special exemption from a legal requirement that it produce a detailed environmental impact study on the possible effects of its Deepwater Horizon drilling operation in the Gulf of Mexico, an article Wednesday in the Washington Post reveals.
Federal documents show that the Department of the Interior's Minerals Management Service (MMS) gave BP a "categorical exclusion" on April 6, 2009 to commence drilling with Deepwater Horizon even though it had not produced the impact study required by a law known as the National Environmental Policy Act (NEPA). The report would have included probable ecological consequences in the event of a spill.
The exemption came less than one month after BP had requested it in a March 10 "exploration plan" submitted to the MMS. The plan said that because a spill was "unlikely," no additional "mitigation measures other than those required by regulation and BP policy will be employed to avoid, diminish or eliminate potential impacts on environmental resources." BP also assured the MMS that any spill would not seriously hurt marine wildlife and that "due to the distance to shore (48 miles) and the response capabilities that would be implemented, no significant adverse impacts are expected."
I really doubt that is going to happen unless capping the well becomes impossible. Then they might seek a restructure of debt. But they have equity in excess of $102B with over $96B of that in reserves. They can afford a pretty substantial hit before they would even think of Chapter 13. They spent almost ten and a half billion dollars just in shareholder dividends and ended the year with $8B in cash. So I don't think they are hurting all that bad AT THE MOMENT.Quote:
Originally Posted by Sourdough
On BP Safety - Hayward was supposed to be the man to clean up BP's safety record. He was brought in as the CEO immediately after all those issues but primarily after the Texas refinery explosion. But he stepped into the helm after having headed up the exploration and production side of the business where all the safety concerns happened. So I'm not all that comfortable that he walks the talk. Browne (former CEO) would have been forced to resign at the end of 2008 because of age but he was pushed aside because of the safety issues.
T - that article is a bit misleading. In fact, the MMS granted every company exclusions to drill. I've read a lot about this very issue and there are four things I think have played key roles in the exclusions. NOTE: this is just my opinion based on what I've been able to uncover.
1. The petroleum lobby had substantial input into the creation of the permitting process. As a result, the window for MMS to review the permit is extremely short, something like 90 days if I remember correctly, but no time at all to conduct enviro impact studies, safety reviews, etc.. The net affect is the MMS routinely grants exclusions for drilling because they can not meet the window time frames.
2. There seems to be a long standing culture of hand holding between the petroleum industry and MMS. That's a lousy culture for an organization that is supposed to be overseeing an industry. It was so bad that former BP executive Sylvia Baca was appointed Deputy Assistant Secretary to Land and Mineral's Management. She's since been removed but Salazar appointed a former BP exec to oversee MMS a year ago.
3. A lot of graft within MMS. You may remember that a number of folks in MMS were given gifts from the petroleum companies. Things like hunting and fishing trips, Christmas parties, tickets to sporting events. Add in drug use and misuse of federal computers (remember all that?) and it's little wonder there was little oversight.
4. Honest scientists were prevented from doing their job. No one in MMS wanted to see a report that said there would be an impact to drilling. “Under the previous administration, there was a pattern of suppressing science in decisions, and we are working very hard to change the culture and empower scientists in the Department of the Interior.” That was a quote from a spokeswoman for MMS in May of this year. The NOAA was pretty scathing in their report on MMS last year. Here is a portion of it.
"In a letter from September 2009, obtained by The New York Times, NOAA accused the minerals agency of a pattern of understating the likelihood and potential consequences of a major spill in the gulf and understating the frequency of spills that have already occurred there.
The letter accuses the agency of highlighting the safety of offshore oil drilling operations while overlooking more recent evidence to the contrary. The data used by the agency to justify its approval of drilling operations in the gulf play down the fact that spills have been increasing and understate the “risks and impacts of accidental spills,” the letter states. NOAA declined several requests for comment."
Looks like NOAA might have been right.
This administration is certainly not without blame. (neither was the previous one for that matter)Quote:
Originally Posted by Trabitha
However, let's keep a sense of proportion about it and do less of finger pointing amongst ourselves and more of where they need to point: BP.
That would be a step in the right direction, IMO.
I'm with Sourdough on this one although for a slightly different reason. Whenever the Democrats gain control they shut down all development in Alaska. That is why in many respects we are like a third world nation. People have to realize where all there stuff comes from and quit getting in the way of those that provide it to them. If there is a better way than do it and put oil out of business but don't expect the rest of us to pay for your disconnect from where our opulant lifestyle comes from. When oil ends so does life as you know it. Common sense would dictate it be done as responsible as possible and environmentalists contribute thier knowledge to accomplish that.
Speaking of safety - they were scheduled to receive a big time safety award right around the time of the accident.
http://www.themaritimelawyer.com/bp-...ear-after-all/Quote:
From Article: The Interior Department was expected to host an event today to honor BP and other companies for its safety efforts, but the agency has changed its mind. The Interior Department’s Minerals Management Services was expected to host the event today and BP was up for two awards at the event. One of the awards was for “outstanding safety and pollution prevention performance.”
Oh, man. That is too funny. Thanks, Crash, I needed that chuckle.
I wonder if AIG is holding the counter-party on the derivatives, insuring the dividend and/or the downside on the stock price.
I just read a great article from MSNBC on the financial health of BP.
"The $20 billion fund BP has set up could be just a down payment on the cost of cleaning up the Gulf spill and paying damage claims. But BP has plenty of cash to draw from, including an average of $20 billion in profits annually, $6 billion in cash and some some 18 billion barrels of proven oil reserves worth $1.2 trillion at current prices.Though the total cost won’t be known until the well is capped, Wall Street is already combing through the company's financial statements and working on spreadsheet scenarios. At Oppenheimer & Co, oil industry analyst Fadel Gheit starts with a worst-case scenario of $6 billion in cleanup costs and $6 billion in damage claims every year for 10 years. That works out to $120 billion.
Even if the payout reaches that level, Gheit said, the company would generate some $14 billion a year of "free cash flow" and still have enough cash to pay shareholders half the $2.6 billion quarterly dividend BP recently suspended."
I don't care who you are those are some impressive numbers.
http://www.msnbc.msn.com/id/37762500...siness/page/2/
Impressive only because of how they achieved them.Quote:
Originally Posted by Rick
The 760 "egregious, willful" safety violations all had to do with saving money in the wrong places--gambling with people's lives and the environment.
It's impressive for any corporation to achieve that kind of financial success. I do agree with you about their moral compass, however. If they had taken a portion of the money they used to advertise how green they were and actually put a failsafe on the well then ............. Hindsight is such a wonderful thing. It even makes me looks smart....well, almost.
The 760 safety violations through the years were not about their faulty moral compass but concrete, cutting corners type of wrong-doing. If that wasn't heads-up (rather than hindsight) about the kind of company they were I don't know what is.
We're agreeing, actually. If they didn't have a faulty moral compass they wouldn't have taken those shortcuts. A company is either ethical or it is not. There is no degree of ethical. No "sort of" ethical. Corporations can and do make a nice profit while still operating as a good corporate neighbor and citizen, within the laws, and they do so treating their employees and suppliers in a fair manner. That is or is not ingrained within the corporate culture and it permeates every corner of the company. Sadly, BP misses the mark on ethics.
Another bit of news...Moodies dropped them from Aa2 to A2. That's a pretty substantial drop... 3 notches. That moves them from high quality with very low risk to upper-medium grade with low risk. That will cost them some additional points when they need to borrow.
Tony Hayward is gone. That's my prediction. Once the well is capped and the clean up is well under way he will step aside. Keep an eye on Andy Inglis as the next CEO. He's from the same school as Mr. Hayward and one of the execs that was fast tracked along with Hayward. You heard it here first!
Why would any govt. want to do business with BP knowing their track record? Obviously BP low-balls their costs and is most likely among the lowest bids, but is that worth such a colosal gamble?
It would be like shopping for a brain surgeon strictly based on his fees and disregarding his track record.
Our govt. bears a great deal of responsibility for the irresponsible choices it made and no amount of retrospective rationalization will change that.
Remember that MMS was part and parcel of the petroleum industry. My momma always said, stupid is as stupid does.
I gotta say, I am a bit surprised, it seems as though the ocean is doing a pretty good job of "Washing" (for lack of a better term), The oil slick, so far, mostly "Tar Balls" have been washing up onto shore, These seem fairly easy to clean up, In fact, I was at a beach in Norther California years ago that had sign up saying that tar balls will be on the beach, these were perm type signs so this was an ongoing thing, Maybe its the calm before the storm, ? I dont know, do you think the big slick of liquid oil will reach shore ? I also have heard that older wells leak oil now and have been leaking oil for many years, I am just hoping that with a little luck, only these tar balls will hit the coast line, Looks like they could just be raked up.
I think the dispersants have broken a lot of it up with a lot of it underwater. Of course, a lot has been burned and a lot has been skimmed, too.
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