Sunday, July 18, 2010



Source: Map of the northern Gulf of Mexico showing the nearly 4,000 active oil and gas platforms. NOAA

One of the world’s biggest natural disasters continues to dominate the headlines, as BP struggles to control the ‘Deep Horizon’ spill. This multi-headed hydra of a story continues to expand and deepen.

Two  major stories are now coming to the fore

– BP’s appalling safety record in the US prior to this latest disaster

See: The Project on Government Oversight story

‘According to our Federal Contractor Misconduct Database, BP has 52 instances of misconduct since 1995 (the most of any contractor in our database) for which it has paid $1.6 billion in fines, penalties, settlements and judgments.

Before the Gulf tragedy, BP’s most notorious misconduct incident in recent years was the 2005 explosion and fire at its Texas City refinery which killed 15 and injured hundreds. That refinery alone accounts for nine separate instances in our database and over $477 million in penalties, including civil and criminal damages and fines for workplace safety and environmental violations.

There was also “Black Thursday,” when BP racked up over $380 million in penalties in five separate instances on one day in October 2007

See also: ‘The well is capped. But what else lurks below the surface for BP?’ by Tim Webb [The Observer July 18, 2010]


- BP’s ongoing contracts with the US military. The key story was ‘BP has steady sales at Defense Department despite U.S. scrutiny’ by Washington Post Staff Writer R. Jeffrey Smith [July 5, 2010].

He reports US Defense Logistics Agency (DLA) figures which show that, in the fiscal year 2009, BP was the Pentagon's largest single supplier of fuel, providing 11.7 percent of the total purchased. BP has contracts worth $980 million in the current fiscal year

‘BP spokesman Robert Wine said he was aware of at least one "big contract" signed by the U.S. military after the oil rig explosion on April 20, involving the supply of multiple fuels for its operations in Europe’

In the US there is a process called ‘debarment’ which is used to shut off companies from receiving federal contracts.

‘Jeanne Pascal, a former EPA [Environmental Protection Agency)  lawyer who until recently oversaw the review of BP's possible debarment, has said she initially supported taking such action but held off after an official at the Defense Department warned her that the Pentagon depended heavily on BP fuel for its operations in the Middle East.

"My contact at DESC, another attorney, told me that BP was supplying approximately 80 percent of the fuel being used to move U.S. forces" in the region, Pascal said.

She added that "BP was very fortunate in that there is an exception when the U.S. is involved in a military action or a war."

A DLA spokeswoman told the Washington Post that "none of BP's current energy contracts are in direct support of operations in Iraq and Afghanistan" and that the department could meet its requirements without BP fuel.

Further details emerged on in a story ‘BP is still a top supplier to US military’ (July 15th)

‘BP is still among the biggest suppliers of fuel to the U.S. military, and the Defense Department has no plans to stop awarding the company lucrative contracts.

‘As of last week, BP has been awarded 17 contracts valued at just under $1 billion, the Defense Logistics Agency (DLA) said. That makes BP the third-largest supplier of fuel to the armed services so far this fiscal year.

‘In fiscal 2009, the DLA granted BP a total of 26 contracts valued at $2.2 billion, or nearly 12% of overall fuel purchases, making it the military's largest fuel supplier that year.

’In fact, BP has already received one small contract since the April 20 explosion on the Deepwater Horizon killed 11 workers and led to a catastrophic oil spill in the Gulf of Mexico. On May 17, the DLA awarded BP a contract worth $342,854 over four years to supply jet fuel to a regional airport in Oregon.

See Also:

Pascal Spills It on BP, Sporkin, and the Disaster in the Gulf on ‘Corporate Crime Reporter’

EPA Officials Weigh Sanctions Against BP’s U.S. Operations by Abrahm Lustgarten [Badlands Journal. June 21, 2010]

BP May Lose U.S. Oil Leases, Contracts as Gulf Spill Punishment by Jim Efstthiou and Jeff Plungis [Bloomberg. June 14, 2010]


BP buys up Gulf scientists for legal defense, roiling academic community

No comments: