Incidents
Hazardous substance dumping
In September 1999, one of BP’s US subsidiaries, BP Exploration Alaska (BPXA), agreed to resolve charges related to the illegal dumping of hazardous wastes on the Alaska North Slope, for $22 million. The settlement included the maximum $500,000 criminal fine, $6.5 million in civil penalties, and BP’s establishment of a $15 million environmental management system at all of BP facilities in the US and Gulf of Mexico that are engaged in oil exploration, drilling or production. The charges stemmed from the 1993 to 1995 dumping of hazardous wastes on Endicott Island, Alaska by BP’s contractor Doyon Drilling. The firm illegally discharged waste oil, paint thinner and other toxic and hazardous substances by injecting them down the outer rim, or annuli, of the oil wells. BPXA failed to report the illegal injections when it learned of the conduct, in violation of the Comprehensive Environmental Response, Compensation and Liability Act.[40]
Texas City Refinery explosion
Main article: Texas City Refinery explosion
In March 2005, BP's Texas City, Texas refinery, one of its largest refineries, exploded causing 15 deaths, injuring 180 people and forcing thousands of nearby residents to remain sheltered in their homes.[41] A large column filled with hydrocarbon overflowed to form a vapour cloud, which ignited. The explosion caused all the casualties and substantial damage to the rest of the plant. The incident came as the culmination of a series of less serious accidents at the refinery, and the engineering problems were not addressed by the management. Maintenance and safety at the plant had been cut as a cost-saving measure, the responsibility ultimately resting with executives in London.[42]
The fall-out from the accident continues to cloud BP's corporate image because of the mismanagement at the plant. There have been several investigations of the disaster, the most recent being that from the U.S. Chemical Safety and Hazard Investigation Board[43] which "offered a scathing assessment of the company." OSHA found "organizational and safety deficiencies at all levels of the BP Corporation" and said management failures could be traced from Texas to London.[41]
The company pleaded guilty to a felony violation of the Clean Air Act, was fined $50 million, and sentenced to three years probation.
On October 30, 2009, the US Occupational Safety and Health Administration (OSHA) fined BP an additional $87 million — the largest fine in OSHA history — for failing to correct safety hazards revealed in the 2005 explosion. Inspectors found 270 safety violations that had been previously cited but not fixed and 439 new violations. BP is appealing that fine.[41][44]
Propane price manipulation
Four BP energy traders in Houston were charged with manipulating prices of propane in October 2007. As part of the settlement of the case, BP paid the US government a $303 million fine, the largest commodity market settlement ever in the US. The settlement included a $125 million civil fine to the Commodity Futures Trading Commission, $100 million to the Justice Department, $53.3 million to a restitution fund for purchasers of the propane BP sold, and $25 million to a US Postal Service consumer fraud education fund.[45][46]
Prudhoe Bay
Main article: Prudhoe Bay oil spill
In August, 2006, BP shut down oil operations in Prudhoe Bay, Alaska, due to corrosion in pipelines leading up to the Alaska Pipeline. The wells were leaking insulating agent called Arctic pack, consisting of crude oil and diesel fuel, between the wells and ice.[47] BP had spilled over one million litres of oil in Alaska's North Slope.[48] This corrosion is caused by sediment collecting in the bottom of the pipe, protecting corrosive bacteria from chemicals sent through the pipeline to fight this bacteria. There are estimates that about 5,000 barrels (790 m3) of oil were released from the pipeline. To date 1,513 barrels (240.5 m3) of liquids, about 5,200 cubic yards (4,000 m3) of soiled snow and 328 cubic yards (251 m3) of soiled gravel have been recovered. After approval from the DOT, only the eastern portion of the field was shut down, resulting in a reduction of 200,000 barrels per day (32,000 m3/d) until work began to bring the eastern field to full production on 2 October 2006.[49]
In May 2007, the company announced another partial field shutdown owing to leaks of water at a separation plant. Their action was interpreted as another example of fallout from a decision to cut maintenance of the pipeline and associated facilities. [50]
On 16 October 2007 Alaska Department of Environmental Conservation officials reported a toxic spill of methanol (methyl alcohol) at the Prudhoe Bay oil field managed by BP PLC. Nearly 2,000 gallons of mostly methanol, mixed with some crude oil and water, spilled onto a frozen tundra pond as well as a gravel pad from a pipeline. Methanol, which is poisonous to plants and animals, is used to clear ice from the insides of the Arctic-based pipelines.[51]
Deepwater Horizon oil spill
Main article: Deepwater Horizon oil spill
On April 20, 2010, a semi-submersible exploratory offshore drilling rig in the Gulf of Mexico exploded after a blowout and sank two days later, killing eleven people and causing a massive oil spill threatening the coast of Louisiana, Mississippi, Alabama, Texas, and Florida. The rig is owned and operated by Transocean Ltd[52] on behalf of BP, which is the majority owner of the oil field. The company originally estimated the size of the leak at about 1,000 barrels a day but later accepted government estimates of a leak of at least 5,000 barrels per day (790 m3/d). On April 30, BP stated that it would harness all of its resources to battle the oil spill, spending $7 million a day with its partners to try to contain the disaster.[53] In comparison BP's 1st quarter profits for 2010 were roughly $61M daily [54] BP was running the well without a remote control shut-off switch used in two other major oil-producing nations, Brazil and Norway, as a last resort protection against underwater spills. The use of such devices is not mandated by U.S. regulators.[55] The U.S. Government gave the responsibility of the incident to BP and will hold it accountable for costs incurred in containing the situation.[56] On May 11, 2010, Congress called the executives of BP, Transocean, and Halliburton to a hearing regarding the oil spill. When probed for answers regarding the events leading up to the explosion, each company blamed the other. BP blamed Transocean who owned the rig, who then blamed the operators of the rig, BP. They also blamed Halliburton, who built the well casing.[57] Scientists have been requesting the right to monitor the amount of oil that is actually being released per day, but "'The answer is no to that,' a BP spokesman, Tom Mueller, said on Saturday, May 15. 'We're not going to take any extra efforts now to calculate flow there at this point. It's not relevant to the response effort, and it might even detract from the response effort.'"[58] Steven Wereley, an associate professor of mechanical engineering at Purdue University, analyzed videotape of the leak using particle image velocimetry and estimated oil flow rates at between 56,000 to 84,000 barrels per day (8,900 to 13,400 m3/d), or equivalent to one Exxon Valdez spill every 3.5 to 2.4 days.[59] A second, smaller leak has been estimated to be releasing 25,000 barrels per day (4,000 m3/d) by itself,[60] suggesting that the total size of the leak may well be in excess of 100,000 barrels per day and could possibly be one of the largest oil spills in history and the worst man-made disaster recorded.
Controversy
Baku-Tbilisi-Ceyhan pipeline
BP has been criticised for its involvement with Baku-Tbilisi-Ceyhan pipeline, due to human rights, environmental and safety concerns.[61]
Colombian pipeline
In July 2006, a group of Colombian farmers won a multi million pound settlement from BP after the British oil and gas company was accused of benefiting from a regime of terror carried out by Colombian government paramilitaries to protect a 450-mile (720 km) pipeline.[62]
Mist mountain project
There have been some calls[who?] for BP to halt its "Mist Mountain" Coalbed Methane Project in the Southern Rocky Mountains of British Columbia. The proposed 500 km² project is directly adjacent to the Waterton-Glacier International Peace Park.[63]
Canadian oil sands
BP is one of numerous firms who are extracting oil from Canadian oil sands, a process that produces four times as much CO2 as conventional drilling.[64] The Cree aboriginal group describe BP as being complicit in 'the biggest environmental crime on the planet'.[65] The Cree aboriginal group also describe the oil sands projects some of the great economic influences of the area.[clarification needed]
Environmental and safety record
BP was named by Mother Jones Magazine as one of the "ten worst corporations" in both 2001 and 2005 based on its environmental and human rights records.[66][67] In 1991 BP was cited as the most polluting company in the US based on EPA toxic release data. BP has been charged with burning polluted gases at its Ohio refinery (for which it was fined $1.7 million), and in July 2000 BP paid a $10 million fine to the EPA for its management of its US refineries.[68] According to PIRG research, between January 1997 and March 1998, BP was responsible for 104 oil spills.[69] BP patented the Dracone Barge to aid in oil spill clean-ups across the world. [70]
A Gulf gasoline station in Louisville, KY using the previous BP prototype. BP purchased all Gulf stations in the southeastern United States in the 1980's after Chevron, Inc. was forced to divest the stations by the United States Justice Department.
BP Amoco was a member of the Global Climate Coalition an industry organization established to promote global warming scepticism but withdrew in 1997, saying "the time to consider the policy dimensions of climate change is not when the link between greenhouse gases and climate change is conclusively proven, but when the possibility cannot be discounted and is taken seriously by the society of which we are part. We in BP have reached that point.".[71]
In March 2002 Lord Browne of Madingley declared in a speech that global warming was real and that urgent action was needed, saying that "Companies composed of highly skilled and trained people can't live in denial of mounting evidence gathered by hundreds of the most reputable scientists in the world."[72]
BP Amoco changed its name to BP in 2000, and introduced a new corporate slogan: “Beyond Petroleum.” It replaced its “Green Shield” logo with the helios symbol, a green and yellow sunflower pattern similar to the emblem of the Green Party of Canada. These changes were intended to highlight the company’s interest in alternative and environmentally friendly fuels. When, in July 2006, BP admitted, only after journalists became aware of the spill, that it was facing criminal charges for allowing 270,000 gallons of crude oil to spread into the Alaskan tundra, critics pointed to the relative lack of press coverage about the spill as evidence that BP had successfully greenwashed its image while maintaining environmentally unsound practices.[73][74]
In 2008, BP was awarded a satirical prize, the "Emerald Paintbrush" award, by Greenpeace UK. The "Emerald Paintbrush" award was given to BP in order to highlight its alleged greenwashing campaign. Critics point out that while BP advertises its relatively minimal investment in alternative energy sources, the majority of its investments continue to go into fossil fuels.[75] BP was also one nominee for the 2009 Greenwash Awards.[76]
BP is a sponsor of the Scripps Institution CO2 program to measure carbon dioxide levels in the atmosphere.[77]
As of 11 February 2007 BP announced that they would spend $8 billion over ten years to research alternative methods of fuel, including natural gas, hydrogen, solar, and wind. A $500 million grant to the University of California, Berkeley, Lawrence Berkeley National Laboratory, and the University of Illinois at Urbana-Champaign, to create an Energy Biosciences Institute[78] has recently come under attack, over concerns about the global impacts of the research and privatisation of public universities.[79]
Solar panel made by BP Solar
BP's investment in green technologies peaked at 4% of its exploratory budget, but they have since closed their alternative energy headquarters in London. As such they invest more than other oil companies, but it has been called greenwashing due to the small proportion of the overall budget.[80]
In 2004, BP began marketing low-sulphur diesel fuel for industrial use.
BP Solar is a leading producer of solar panels since its purchase of Lucas Energy Systems in 1980 and Solarex (as part of its acquisition of Amoco) in 2000. BP Solar had a 20% world market share in photovoltaic panels in 2004 when it had a capacity to produce 90 MW/year of panels. It has over 30 years experience operating in over 160 countries with manufacturing facilities in the U.S., Spain, India and Australia and has more than 2000 employees worldwide. Through a series of acquisitions in the solar power industry BP Solar became the third largest producer of solar panels in the world. It was recently announced that BP has obtained a contract for a pilot project to provide on-site solar power to Wal-mart stores. In the 2006 annual report Lord Browne noted that BP now has a total wind generation capacity of nearly 15,000 megawatts. 15,000 megawatts would be sufficient to provide power to approximately 15,000,000 typical American households simultaneously. This makes BP one of the largest generators of wind power in the world
Contributions to political campaigns
According to the Center for Responsive Politics, BP is the United States' hundredth largest donor to political campaigns, having contributed more than US$5 million since 1990, 72% and 28% of which went to Republican and Democratic recipients, respectively. BP has lobbied to gain exemptions from U.S. corporate law reforms.[81] Additionally, BP paid the Podesta Group, a Washington, D.C.-based lobbying firm, $160,000 in the first half of 2007 to manage its congressional and government relations.[82]
In February 2002 BP's chief executive, Lord Browne of Madingley, renounced the practice of corporate campaign contributions, noting: "That's why we've decided, as a global policy, that from now on we will make no political contributions from corporate funds anywhere in the world."[83]
Despite this, in 2009 BP used nearly US$16 million to lobby US Congress, breaking the company's previous record (from 2008) of US$10.4 million.[
