Re: Rep. Barton. :sigh: He's a local. I love 'im. I'm pissed that MSM is only playing snippets of his apology to BP - it gives a *totally* different spin on it. If you watch the *entire* thing, and not just what the MSM wants you to see, you see that Rep. Barton SAID, up front, that yes, BP needs to pay for damages. YES, criminal charges are being considered. He then goes on to say that here, in America, we have due process....and then he goes into the parts you hear on MSM. - THAT's what he apologized for - the fact that they are being forced to pay billions before ANY charges/definate fault has been proven.
Is BP at fault? Undoubtedly. Should they pay something? Yes. $20 Billion? I dunno - what happens if the damages only equal $2 Billion? What happens to the other $18B? By rights, it would go back to BP.....but I betcha it won't. (And I don't KNOW how much this is going to cost - it could be in the Trillions. Point is, we DON'T know.)
Look, it's like this. Say I live in a townhome. It catches fire and burns my unit, the one next door, and half the block. Got that? Good.....now, here are 2 scenarios:
1. I'm pissed at the bank, because I can't pay the mortgage, so I deliberatly set fire to the unit.
2. I had lit some candles to create a romantic mood; my spouse and I got...ummm...in the mood and I forgot to blow 1 candle out. It was on the table; our cat jumped up there, knocked it over, catching the tablecloth (and thence the curtains/rest of the unit) on fire.
OK.....so, ignoring insurance (since the US Gov't is ignoring BP's insurance - and I can Guarantee that BP has insurance that'll cover blowouts. Maybe not as catastrophic as this one is, but they DO have some form of insurnace, if only to cover their investment partners. More on that in a minute) how much am *I* personally liable for? In scenario 1, I should be liable for all damages - it was a deliberate act. But what about scenario 2? It wasn't pre-planned, I certainly didn't intend on losing my investment....but should I be responsible for the entire cost? Think about this - it's the same (basic) scenario we're looking at in the Gulf (only on a much smaller scale, of course).
Also.......the oil industry is SO specialized. BP may NOT be the company that ultimatly is responsible. (Bear with me). BP may be the parent....BP America is a subsidiary, but stand-alone company that handles the US arm. BP Exploration (I'm guessing on the names here, but this is standard) is the one that actually handles all the drilling. Same parent company, but each company is a stand-alone (BP is probably the major share-holder in all these companies, not really the "owner"). Still with me? OK...
When you drill a well, YOU don't put up all the funds. An on-shore well will cost around $3M (for a relatively shallow well, with no complications during drilling - dry hole costs are around $1.8M or so - the rest is completion costs)...no company wants to tie up that much money on a well that may prove to be a dry hole. So, you sell interests in that well - most oil companies have a list of folks/other companies that are willing to go in, so we're not talking Joe Blow can join in. Usually, the driller maintains 50% or so, the rest is sold in proportionate shares (and, to further confuse matters, there are Royalty interests as well, that make up about 5% of the ownership. RIs go to the landowners (in the Gulf, it's either the state (LA) or the US gov't), the landman that got the lease, possibly the company officers......small %'s, yes, but if you have enough of them they add up! RI owners are NOT responsible for any of the expenses - those belong to the Working Interest owners). You, as the driller, HAVE to have insurance, or no one will invest in the well - if you do have a blow-out (and that's not that common anymore, honestly - in the 30 years my company's been in business - and we started out doing our own drilling! - there's only been 1 blowout. In the over 10,000 wells we've drilled/participated in.), you want your investor's money covered.
So...why hasn't the insurace been mentioned?
I can tell you what I see happening. BP Exploration is going to file bankruptcy. Bye-bye money - BP America and BP will be fine, and untouched, because Hey - they're not involved in this! BP Exploration is probably in hock up to their necks, due to all the drilling they've been doing.....so there won't be any money to pay creditors with. (Which is why the oil industry is so specialized. Drillers spend the money, the major stock-holders reap the profits. Most drillers have few employees - you hire contractors. It's cheaper - no insurance, no bennies; that's for the contract company to provide. I didn't say it was *fair*, but that seems to be the norm.)
:huh: I kinda went off track there, but the persecution of BP is really driving me nuts. IT WAS AN ACCIDENT. A horrible one, yes - 11 people DIED, for pete's sake! - but to villify BP without due process is WRONG. And it does set a very dangerous precident.....and I'm like Rep. Barton - I don't want to live in an America where due process is ignored. Do you?