I anticipate BP will simply file for the bankruptcy protection within the next 90 days and the U.S. (and possibly U.K.) taxpayers will be on the hook again for the cleanup, which at this point is nearly impossible. I doubt we'll be able to plug the hole within that time. Should the mess spread out to Mexico and Caribbeans, you're looking at a catastrophe of epic proportion. With the hurricane season brewing, I see no hope. <iframe src="http://www.pbs.org/newshour/rundown/oil-ticker/" height="300" style="align:center;" width="310px" marginheight="5" marginwidth="5" frameborder="0" scrolling="no"></iframe>
they have been using "toxic dispersants" at the sources of the leak to "break the oil down". the net effect of this is that the oil is completely mixed with the water, is staying relatively deep and is not visible, and is basically poisoning the entire gulf. it will stay off the shores (to a limited degree), but it may kills large swaths of the gulf, and possibly the keys and caribbean. this could end up having a severe economic impact. do not be surprised to see the market sell off on the news from this weekend. it's much more serious than they are letting on at this point.
Well, I don't know what the current financial picture looks like, but as at BP's 2007 fiscal year end, it had shareholders' equity of $93.7 Billion and net tangible assete of $76 Billion. There's going to be hell to pay. At least they have a fair amount of financial resources with which to do it. http://ca.finance.yahoo.com/q/bs?s=BP&annual
That's the beauty of Corporate Structures and Settlement Agreements. The Exxon lawsuits have been going in for 20 years and no one but attorneys have been paid. AIG is one BP's primary insurers.. so guess who ends up footing this bill anyways... All they have to do is set aside a minuscule amount.. ie $10M in a liquidation trust. Hire a law firm to serve as Trustee and tie it up for 20 years. Blame the contractors and maybe fire a few execs and hang them out to dry. Transfer Assets from the trust to a New Company "Big Oil" and its business as usual. US claims are not going to go far once BP's US corporation is dissolved and all of its significant assets are sold, hidden and transferred to the new shell. BP doesn't pay a penny in US income tax.. The prudent business decision would be to dissolve the US business refer all claims to the lawyers and their insurer AIG and walk away. The BP Brand name and good will is damaged and best to spend money changing all the signs to "Big Oil". It's a tragedy but clean up is not part of their corporate charter. They exist for the sole purpose of making profits for their shareholders. The shareholders will gladly exchange their BP shares for "Big Oil" shares.
It appears that Exxon has not yet settled the case of Baker v. Exxon but to say that no one but lawyers has been paid so far does not appear to be true: http://en.wikipedia.org/wiki/Exxon_Valdez_oil_spill#Litigation_and_cleanup_costs Exxon's official position is that punitive damages greater than $25 million are not justified because the spill resulted from an accident, and because Exxon spent an estimated $2 billion cleaning up the spill and a further $1 billion to settle related civil and criminal charges. Attorneys for the plaintiffs contended that Exxon bore responsibility for the accident because the company "put a drunk in charge of a tanker in Prince William Sound."
BP has always been a second class outfit. At least from the marketing side. This should finish them off, if they don't get it plugged soon.
I dont understand why they have to wait days between the different plans to cap it. As soon as one fails they should be starting another, there have been 3 major efforts in 40 days. Next is to cut off the bent riser which is frightening. There has been sparse info on why the blowout prevented is not working. I am sure BP is frustrated.
Exxon appealed the 5 Billion valdez verdict awarded in 1999 and had it reduced to $500M. The matter still is not settled and many of the injured parties have died or given up. Same game is going to be played here. 2010... This matter will still be going on in 2030 because the lawyers can milk this for decades. Both BP and Exxon do not pay any federal income tax. BP makes $93 Million a day. "At $15 billion, the tax bill totaled 47% of pre-tax earnings. It wasn't much better at Chevron, which paid $8 billion in income tax, or ConocoPhillips, at $5 billion. And these amounts were modest compared with the price spike year of 2008, when Exxon paid $36 billion in income taxes. Yet before you thank Big Oil for financing Uncle Sam's profligacy, get this: Exxon paid none of its 2009 income taxes in the U.S., while Chevron sent the U.S. Treasury just $200 million. Naturally, the oil giants do most of their business with high-tax oil-rich regimes. Exxon has many homes for the plentiful profits left over, with 20 wholly owned subsidiaries domiciled in the Bahamas, Bermuda and the Cayman Islands. These (legally shelter) the cash flow from operations in the likes of Angola, Azerbaijan and Abu Dhabi." Cut -n-paste from Forbes