Louisiana Federal Judge Blocks Drilling Moratorium 691
eldavojohn writes "In the ongoing BP debacle, the Obama administration imposed a six-month moratorium on offshore drilling and a halt to 33 exploratory wells going into the Gulf of Mexico. Now a federal judge (in New Orleans, no less) is unsatisfied with the reasons for this and stated, 'An invalid agency decision to suspend drilling of wells in depths of over 500 feet simply cannot justify the immeasurable effect on the plaintiffs, the local economy, the Gulf region, and the critical present-day aspect of the availability of domestic energy in this country.' The state's governor agrees on the grounds that blocking drilling will cost the state thousands of lucrative jobs." The government quickly vowed to appeal, pointing out that a moratorium on 33 wells is unlikely to have a devastating impact in a region hosting 3,600 active wells. And reader thomst adds this insight on the judge involved in the case: "Yahoo's Newsroom is reporting that the judge who overturned the drilling moratorium holds stock in drilling companies. You can view his financial disclosure forms listing his stock holdings online at Judicial Watch (PDF)."
Re:So? (Score:2, Insightful)
Have a 401k or any investment vehicle that has DJIA or S&P400 indexes in it? Then you do, as well.
I have no problem with this ruling, seeing as the agency concerned has no evidence to show that what happened with the problematic rig is likely to happen, with any sort of likelihood, on any other rig.
Re:So? (Score:3, Insightful)
I'd also be interested in where he lives. Nowhere near the coast or on a part of the coast that is already covered in tar, and he wants others to feel the petroleum love?
Judges are outdated (Score:0, Insightful)
It's sickening that, in this modern age, we let a single person throw around this much power.
Re:So? (Score:5, Insightful)
The idea was to hit the "pause" button on 33 new wells while we figure out why the new-well drilling at Deepwater went so wrong.
There are still 3300+ wells operating in the Gulf which were unaffected by the moratorium.
Do you think that six months of wait on 1/100th of the Gulf wells will destroy the economy?
Re:So? (Score:0, Insightful)
From Obama's speech about a week ago: (Score:1, Insightful)
"A few months ago, I approved a proposal to consider new, limited offshore drilling under the assurance that it would be absolutely safe"
LOL, tool.
Re:So? (Score:3, Insightful)
Have a 401k or any investment vehicle that has DJIA or S&P400 indexes in it? Then you do, as well.
The honorable gyrogeerloose is not actually presiding over those hearings, so it's not hypocrisy to point out that a conflict of interest exists there, if that's your aim.
Crooked Judge (Score:3, Insightful)
Why in the world would a judge hear a case when the outcome could effect his own wealth? Secondly does the judicial branch even have standing to enter the fray when the president makes a decision in time of great national emergency? I would think that even the Supreme Court may lack the authority in this case.
I can not exactly quote Bill Maher on the lost jobs issue but I will amend it to say that he said stuff your damn job. You people want to destroy the oceans, destroy the forests and completely destroy the Earth. It's time for you absurd red necks to get an education and work in areas that do not destroy nature. His version was much more insulting. But the man does have a point. Whether it is the coal mine areas of our nation or the oil rig areas or the areas being deforested by sprawl and timber harvesting it is not the Ph.D. people that we see doing those tasks. It is left to people who have very rudimentary educations or no education at all. The more we allow them to continue in ways that they have done in the past the more harm will fall upon all of us.
Re:So? (Score:2, Insightful)
It could be devastating to the small contingent of workers who build and supply parts for new rigs/wells/ships/etc
not a problem (Score:5, Insightful)
Kind of like how Ford, GM, and Honda were probably double and triple checking their acceleration systems after Toyota's little stint in the headlines recently.
Re:Yeah - but does the reasoning make sense? (Score:2, Insightful)
Yes, I'm sure temporarily closing less than 1% of the active wells in the region will be absolutely devastating to the local economy. Clearly, the oil engineers need to take the time to reinspect their installations and re-think containment and capping procedures; current procedures have show themselves to be extremely ineffective. Taking 6 months to review policy and technology involved after a disaster of this magnitude seems pretty logical to me. Besides, how exactly is it this judge's job to weigh the harm and benefit of a presidential order?
Re:So? (Score:5, Insightful)
I have no problem with this ruling, seeing as the agency concerned has no evidence to show that what happened with the problematic rig is likely to happen, with any sort of likelihood, on any other rig.
This is the opposite of insightful.
The event on the problematic rig was highly unlikely to happen, but when it did happen there was no way to recover. It's still leaking now - two months later. Claiming that lightning won't strike twice is not an intelligent response.
Re:So? (Score:5, Insightful)
We're so used to being shamed into believing that just because personal inclinations exist we have to throw out all logic and reason.
We're dealing with big oil. Conflicts of interest over oil companies are something we'd be idiots not to take seriously. Remember Joe Barton, on the House Energy and Commerce Committee? Actually apologized to BP a few days ago for them having to pay for the damage they caused? Should we assume that guy had public interest at heart?
Drilling apparatus' will go elsewhere. (Score:2, Insightful)
The drilling rigs are not cheap. Having them sit idle will cost millions and millions of dollars. There is demand for them elsewhere in the world. They will contract out to other companies operating in other countries. When the moratorium is lifted in 6 months, there won't be any available rigs to be had which means no jobs either.
Re:So? (Score:4, Insightful)
Re:So? (Score:5, Insightful)
Were these the same regulators that were "inspecting" Deepwater Horizon?
Re:So? (Score:5, Insightful)
Go ask Gulf fishermen.
Re:So? (Score:5, Insightful)
Re: Crooked Judge (Score:1, Insightful)
HOLY SHIT!
You think that the PhDs are less responsible for the environmental impact of these activities than the Blue-collars paid to do it? The white-collars are just as much to blame for buying the gasoline, electric power, steel products, housing paper, etc!
The reason corporations pay people to do these things is because they can make money doing so. They can make money because people buy their shit, so don't complain about the 'rednecks' that are just trying to get an honest job. Look to yourself and your willingness to get that latte in a paper cup, to grumble about high gas prices, etc. Just because you aren't out there cutting the trees yourself doesn't mean that you are responsible for their destruction when you are buying the stuff being made from those trees. If no one would buy, the tree wouldn't be cut.
Of all the people responsible for the environmental impact of this stuff the low-level operators are about the least responsible (except that they also contribute to demand).
Disclosure: I am not a PhD, but I do have a master's and I do not cut down trees for a living, I write code.
Re:So? (Score:2, Insightful)
People who use the phrase "big oil" non-ironically are just trying to use emotions to drive their point. Barton apologized because the Consitution doesn't give the president the authority to just take money without due process from a company and give it to people he wants. Many other economists are incensed over this issue.
Re:So? (Score:4, Insightful)
Deepwater Horizon was a series of mistakes with known causes, not a tail-end probabilistic event. Future deep-water drilling will likely be more carefully regulated.
Re:Crying in your oil... (Score:3, Insightful)
Did you just play politics right after complaining about people playing politics?
Here's a tip for next time: if you had used a semicolon instead of a period, you could have made a statement and then contradicted yourself in the same sentence.
Re:not a problem (Score:3, Insightful)
If you're a deep water drilling company and you don't have all your ducks in a row after that, you're an idiot. So Obama's reasoning for the moratorium, until the safety measures can be re-evaluated, is redundant because these companies had better be at the forefront of responsibility without further external incentives.
Incentives being in place failed to prevent this in the first place, why would you assume they'll prevent another case? It was clearly in their interests to do that before. BP going bankrupt because of this is not surprising. Yet that apparently didn't stop BP from cutting corners everywhere they could, gambling with not only the investors' money, but the entire gulf region as well. It's not like the big investors and executives are going to see any negative consequences of BP going under. I see no reason to assume that oil companies have suddenly wised up since they should have before. The other guys had the exact same plans in place to deal with this.
Regulations may actually be enforced now, which may help and might have prevented this, but the oil companies seem to have neutered the regulators if not actually achieved regulatory capture, and as I said earlier, their interests have not changed.
Re:Yeah - but does the reasoning make sense? (Score:3, Insightful)
Re:So? (Score:5, Insightful)
I'm really getting sick of this little bit of misinformation.
Joe Barton, on the House Energy and Commerce Committee? Actually apologized to BP a few days ago for them having to pay for the damage they caused?
That is NOT what happened. I don't think anyone, including Joe Barton, thinks that BP should not pay for the mess thy have made. The apology was for the methods used by the administration to basically force BP to set up a $20B fund, completely bypassing due process. To be clear, I believe that BP should pay for everything but I question I question the viability of forcing BP to liquidate assets and set aside $20B - even big evil oil companies need operating revenue. Don't forget that a log of British citizens stand to lose a large chunk of their retirement if BP goes belly up.
If the preceding makes no sense to you take a basic finance class.
Pissed about this whole process (Score:4, Insightful)
Oil industry apologists are saying we're all being whining, ungrateful children because we reap the benefits of cheap energy but bash the poor, hard-working people who put the gas in our cars. But what they don't mention is the fantastic amount of money spent buying this oil-dependent reality in the first place. From buying politicians to clouding the issues in the public forum to preventing research in clean alternatives. It's a sick, terrible system. And it's impossible to use the tools of democracy to fix it because even when we try to vote for change it's bait and switch.
The thing that gets me is how the writing can be plain on the wall and people who don't know better take their cue from people who do know better but whose financial best interests depend on pretending they don't. "Global warming is just a theory! It's still debatable!" Yeah, about as debatable as the theory that tobacco is a carcinogen. Hell, we can even get Republican presidents to mouth the words "oil addiction" and "we need to kick the habit." We just can't get anyone -- reps or dems -- to do a fucking thing about it. They're both beholden to the special interests.
I can't even begin to fathom that latest talking point, Obama's being mean to BP. Chicago-style takedown! What the fuck?! And I bet you're still upset about those fucking Eskimos beating up on poor ol' Exxon for all those decades trying to get the money they've been promised. $20 billion is going to be a drop in the bucket for all the damages wracked up and there will never be a full accounting. Most victims will never be made whole.
From the bleating on the right, you'd think that Obama had nationalized BP, crucified their board of directors on a line of crosses on a tarred beach, and signed an executive order to go to 100% renewables before 2012. If only! I'm actually pissed at how anemic his response has been. No, he can't snap his fingers and make the well go shut, he can't stand on the heads of the engineers and make them work faster but he could at least help unsnarl the clusterfuck that is the disaster response. He could take BP's management out of the loop on disaster mitigation. He could put the environmental experts in the control room so they can get the unfiltered information from the well head minus the BP spin. At the very least he could prevent the BP contractors from burning the sea turtles.
Yeah, yeah, mod me down. Go and confirm exactly what I'm saying.
Re:So? (Score:4, Insightful)
Actually it's the folks on the Gulf coast who are most concerned about the moratorium, because they're the folks who make their living supplying the rigs that were put under the moratorium. A moratorium could put them, their friends, and their neighbors out of work.
All at a time when lots of people (fishermen etc) are already out of work from the spill, and when the unemployment rate before the spill was already high.
This isn't a case of people who don't care. They do, because it's their homeland getting polluted with oil. But they're worried about supporting their families too.
Re:not a problem (Score:3, Insightful)
If you're a deep water drilling company and you don't have all your ducks in a row after that, you're an idiot.
Are actually assuming that there is a shortage of idiots?
Re:So? (Score:3, Insightful)
ecosystem that a ton of people rely upon for jobs.
Re:So? (Score:5, Insightful)
BP has essentially proven that at least some oil companies don't know what to do if there is a problem. A moratorium is just saying "get your act together". Except companies are desperately trying to point to BP as an anomaly, the shoddy worker in a collection of saints. So the moratorium is also saying "ok, let's check if you guys really are that saintly after all." After a massive catastrophe like this, it makes no logical sense to go full steam ahead as if nothing happened.
Re:So? (Score:4, Insightful)
He was right that the government basically telling BP "Start coughing up without a being found guilty because we said so or we'll might start fining you/killing your licenses" should be illegal. Due process exists, and it should be followed. That's extortion.
He was an idiot for phrasing it as an apology to BP.
The idea that the government is setting a precedent that it can interfere with a business like that worries me. The BP case is really clear cut. Even if it was the contractor that messed up, BP was supposed to keep tabs on them and owned the well. But what happens when some large company gets accused of something else (say the Vioxx lawsuits) and the government starts pressuring them to pay out before any legal decision? What happens if it turns out, like power line cancer and thimerosol autism, that the company isn't at fault? How do they get all that money back?
I understand getting people money faster instead of the 20 year Exxon-Valdeeze thing, but this seemed so close to coercion.
Re:So? (Score:4, Insightful)
He didn't give it to people, he put it in escrow. You can argue that this is still wrong, but at least accuse him of what he actually did. He didn't just hand out a bunch of money to whomever he wanted.
This is Obama's Katrina... (Score:1, Insightful)
Observe: a presidency going down in flames...
Re:So? (Score:3, Insightful)
Re:So? (Score:5, Insightful)
Re:So? (Score:5, Insightful)
I am sure that there was no issue of "due process" here. BP did not have to do as the President requested. It was just the President asking BP to step up and do what they should do out of moral decency. Of course, they could have turned down the President. Of course, in that case they probably would have been sued by the Federal government into even greater oblivion for the damages they have caused. They also could have had their regulatory ass handed to them for the next how ever many years this administration was in power over every little infraction. I think BP just made a reasonable business accommodation. And for those of you whining about how unfair to BP this is... it's our local ecosystem. They can always go home and screw up their own if they don't like the way the game is played here.
Re:Yeah - but does the reasoning make sense? (Score:3, Insightful)
No. His ruling does not make sense. The fact he has an apparent conflict of interest does not make is lapse in judgment any better.
I disagree. It's a perfectly logical one. Here is what the President is saying:
Now here is what the Judge and the drilling advocates are saying:
Arbitrary and Invalid?
I hardly think so. They are only asking for 6 months, not a permanent ban. Their reasoning is that until we understand exactly why the BOP failed, what policies, methods, and/or procedures failed, we should just stop until we have a clear understanding of how to proceed safely.
That sounds like a pretty reasonable and logical argument to me. Let's get information to operate intelligently on an ongoing basis in the Gulf. That is not fallacious reasoning, nor it is founded on or subject to personal whims, prejudices, etc. I do not find it to be either despotic, or tyrannical of the President to ask for this. Calling the decision invalid and arbitrary is just adding vitriol and insults to the debate.
Other than those words....... what reasoning did the dissenters give for continuing? What technical arguments did they make that a BOP failure will not occur like this in the future? Did they say, "Here!! This right here is what BP did wrong. They put Slot A into Tab C. Everybody knows that goes into Tab B. We won't do that, so we will be OK.".
I see no reasoned arguments provided by the Judge in that article. What I do hear is a lot of gloating by people that are clearly biased, and make claims that the President's logic is faulty, without actually backing that statement up with an analysis supported by facts.
Like I said, it can't help that the Judge has financial interests with Oil and Gas either. Seriously. I am willing to believe that it is happenstance. If you have money and you live in the South, of course you have some money in Oil and Gas companies. I don't find that suspicious. At the same time I can't blame people having the immediate reaction of claiming corruption either.
Now you would have an excellent point, a logical and well reasoned dissenting point considering the mood of this thread, if the President asked for a permanent ban and the dissenters provided a plethora of technical evidence supporting their claims of how unlikely it is to happen in the future.
Re:So? (Score:4, Insightful)
Re:As always, units matter (Score:3, Insightful)
Yes. And "undoing" the moratorium at the end of six months may be substantially more difficult then starting it has been. The rent on a large semi-submersible drilling rig such as the one that burned and sank when the BP well blew out may exceed $500,000 per day just for the rig. The rig owners — generally not the oil companies — will not let these sit idle for 180 days if there are opportunities elsewhere. Once the rigs have been relocated to Brazil or Africa, it may be quite expensive to entice them back.
Not to say that a moratorium is not an appropriate response. Just that there may be long-term consequences of that decision that do not appear to have considered.
Re:So? (Score:3, Insightful)
I have no problem with this ruling, seeing as the agency concerned has no evidence to show that what happened with the problematic rig is likely to happen, with any sort of likelihood, on any other rig.
Too right. And what happened on that rig was an accident, if by accident you mean "an easily foreseeable result of poor safety standards and corner-cutting that prioritized saving money over safety," what most people would call an inevitability.
Honestly, I am completely amazed at the mental gymnastics on display here. Usually you don't get failures this stark and dramatic outside of wars. We'd been assured these wells were safe, that everything was being handled to the highest standards, and then something like this happens. Is this the "come to Jesus" moment? Is this when there's an introspective reevaluation of just how off those assurances were from reality? This is like the general who just lost his whole army saying "I don't see why the outcome of one battle should invalidate the martial traditions that have well-served our fathers and our forefathers." Um, did you just see what happened?! If terrorists blew up the well you could maybe say that this was something unexpected and outside of the design envelope. If a freakin' radioactive dinosaur tore the thing down you could call it an act of Godzilla. But this was a rig operating outside of the standards set by industry best practice, a rig lacking the safety equipment used by other drillers, which suffered a catastrophic failure due to the management policies of BP. And the problems on this rig are not unique!!! There's no telling how many others are out there waiting to blow up.
But no, let's not be hasty. General Ripper may have launched a nuclear strike on the USSR under his own recognizance but you have to admit that our nuclear command and control system has worked fairly well up to this point. I don't think we should dismiss it entirely just because of this one incident!
Re:not a problem (Score:3, Insightful)
What happened exactly?
They lost less than the amount of money they make in a year. I fail to see how anything bad really happened. If anything BP will do this again since the cost of doing it right may well be higher.
Re:So? (Score:3, Insightful)
Or any fisherman whose catch is from the gulf stream current in a few months. The oil spill water is going to go around Florida and into the gulf stream current. This will screw up a lot more then the catch from the Gulf of Mexico.
Re:Yeah - but does the reasoning make sense? (Score:5, Insightful)
Maybe because it hasn't been exploding every day for three months and promising to do so for at least another four, affecting the fishing and tourism industries of four states?
But really, I don't think you want to hitch your rhetorical wagon to Massey Mining. They have more safety violations than BP, and their CEO should be in goddam jail.
Re:not a problem (Score:3, Insightful)
We've spent far too long with a government that didn't believe in governing and every regulation they couldn't scrap wasn't enforced by people who were either intentionally incompetent (Brownie'd) or people who were on a revolving door situation with the industry they were tasked with regulating.
We'll be a generation cleaning up this mess and these disasters aren't over.
Re:So? (Score:5, Insightful)
To be clear, I believe that BP should pay for everything but I question I question the viability of forcing BP to liquidate assets and set aside $20B
They way you make it sound, BP was forced to go down to the local pawn shop and sell all the family heirlooms the next day. The Obama administration got a promise from BP that they would set aside a $20 billion account. The details have not been worked out but one detail that I did hear was that it was $5 billion a year for 4 years. Considering that BP made $16 billion in profits last year, I would think they could figure out a method to do so without disrupting the company financially.
- even big evil oil companies need operating revenue.
As a company, BP's revenue of $246 billion in 2009. Asking for less about 2% of revenue to be funded over the course of a year isn't a major strain on their revenue.
Don't forget that a log of British citizens stand to lose a large chunk of their retirement if BP goes belly up.
Did anyone say anything about bankrupting BP? No. BP made profits of $16, $22, $21, and $22 billion the last 4 years. At most, they will be losing out on profits for one of their last 4 years or 25% of the profits for the last 4 years.
One main reason that the administration was insistent about a fund is that though the Exxon Valdez incident happened over 20 years ago, some litigants in Alaska still haven't been paid yet. Could you wait 20 years for money that was owed to you?
Re:Yeah - but does the reasoning make sense? (Score:5, Insightful)
I've been waiting for someone to bring up this argument. It is completely flawed. If someone doesn't drill a well the oil doesn't magically disappear. If someone doesn't know how to drill a well without flooding the gulf with it they need to get the fuck out of the business. Another rig will be right behind them. If not, the oil isn't going anywhere.
Re:Big picture. (Score:3, Insightful)
> So I think the key factors that need to be considered are: how much damage a moratorium does to the local economy, the likelihood of a second spill during the next several months (and how much that likelihood can be reduced through simply properly enforcing existing regulation), and the potential damage to the local economies in the event of a second spill.
Right. This is an excellent example of "managed risk". Impact of not drilling, vs likelihood of another blowout, vs impact of another blowout. If the first part is big enough, and the second part is small enough, it might make sense to risk the third part. How many years ago was the last deep sea blowout? What is the real probability of it happening again in the next six months?
It's a tricky equation which probably can't be solved (correctly) by big emotional gestures.
LOL @ What? Millions Share His Belief. (Score:5, Insightful)
LOL, tool.
Exactly what are you laughing at? A year ago, the common wisdom -- particularly on towards the right side of the political spectrum -- was that environmental concerns are just handwringing by whacko liberal moonbats, that increased offshore drilling is a necessary part of a comprehensive energy plan, that it would help reduce our dependency on foreign oil (somehow, magically, despite the fact that in free market system it all goes on the global market anyway), and that The Industry can be trusted to self-regulate.
Hell, if you read this thread, you'll *still* see people saying the industry can be trusted to self-regulate... it'll all take care of itself, don't you worry now.
You know what's behind this? You know that meme that probably more than half of slashdot FIRMLY believes -- that the private sector is always more competent than the public? That the public sector can't do anything right, can't regulate correctly, can't do anything other than act as a net negative drag on the private sector?
Yeah. Obama the radical socialist that he is? He partially believed that too. He believe what he was told by the executive apparatus and the oil companies -- that the oil companies had top expertise, that they knew exactly what they were doing, that they had safety dialed in and had right incentives to behave without further regulation. And, of course, that there wasn't massive regulatory capture during a presidential administration headed up by two guys who've been Oil guys for a long time.
What would be funny if it weren't so utterly pathetic and gravely consequential for the future of our society is that even though Obama has apparently learned his lessons, there's millions who won't.
Funny how it's playing out that way in financial regulation, too. We're all going to be asked to believe that cosmetic choices that won't cause any real pain for Wall Street are the best way to go -- and after all, the bankers and finance guys are the industry experts, so who better to advise us? We certainly wouldn't want meddling outsider officeholders drafting legislation about an industry they know little about without heavily consulting the industry about the best path, right? We wouldn't want heavy government involvement, anyway. That's a drag on The Market at best... and Socialism at worst.
You're going to hear this stuff. Again. And Again. Lots of times between now and the election. Some of you with fiscal conservative tendencies are going to fall for it. Some of you with libertarian tendencies are going to fall for it hook, line, and sinker. If enough of you fall for it, we're going to be here again in 5-10 years, same people saying loudly that the real problem was government meddling, socialism, we should have just let the private sector work. And the same actors in the private system will be racing their yachts and walking away with billions while socialized environmental and financial cleanup costs mount, one way or another.
Well, that's what you'll hear from some commentators. From others, you'll hear "LOL, tool."
Re:So? (Score:2, Insightful)
That may be so, but the problem is that no one has correlated the effects of the 33 exploratory wells impacting those negatively.
The best they have done is said "these people fucked up and something happened". There is no reason to believe the other people have fucked up or that anything is going to happen to them. Attempting to weight the jobs now is no different then before the BP disaster except that we have an ongoing reminder of how bad it can get if something goes wrong. Outside of that, nothing it different.
Re:As always, units matter (Score:5, Insightful)
The proper solution is not to stop drilling, but to require a relief drill to be dug at every site. That way if this happens again, we don't have to wait 4 months. This way we can be safe, collect oil, AND double employment on drilling platforms.
Re:As always, units matter (Score:3, Insightful)
The distinction is important.
Excellent point. And does anyone believe that the Obama administration would be able to complete a study or make meaningful changes (or even suggestions for changes) in six months? They haven't shown any sign that they could. It's been over two months and so far all we've seen is finger pointing.
Re:As always, units matter (Score:4, Insightful)
The long term consequences are of the petroleum industry's own fault. BP (and others) should have weighed the risks of something really bad happening against cutting corners during drilling. Consequences include the swift reactive and punitive response of federal and local governments.
Where's the incentive for industries to regulate themselves (which they should do in addition to the government) if they are quickly relieved of the consequences?
Re:The Economist's opinion (Score:5, Insightful)
The magazine frowns upon all these things and it makes some sense. If, as The Economist suggests, BP's value has already dropped by $89 billion and that's "far in excess of all but the most dire forecasts of the ultimate costs of the spill," what is to be gained by all this backlash against the oil industry but a bunch of political posturing?
If a reduction in market capitalization was an actual expense for BP, this would be a moderately reasonable point.
Since that's absolutely not the case, then the point of the backlash is to ensure that BP actually pays the price for the spill, with the result that they and other companies are actually driven to improve their safety procedures and more importantly follow those procedures that they already should have been.
All that $89 billion means for BP is that they're a somewhat easier target for a stock buyout. It means that the fraction of their own stock that they own is less valuable, so if they were planning on any acquisitions using stock it's going to be more costly as long as the stock price is low. It means anyone who plans on cashing out their holdings in BP right now will make less money. It's not insignificant from a larger corporate strategy perspective, but it's actual impact to BP is nothing like what an actual $89 billion actually suggests.
Shame on The Freaking Economist for suggesting otherwise.
News flash: The United States is still inexorably reliant on its oil industry. If the Obama administration wants to do something about future oil disasters, maybe it should think more seriously about that and what can be done about it.
Like developing alternative energy sources from solar to nuclear, and encouraging the development and adoption of fuel efficient and preferably electric vehicles? Yeah, that's being done. I'm sure more can be done. I'm all for it. I hope you are too.
Also, had government done a better job of regulating the oil industry in the first place, BP's shoddy practices might not have gone unchecked and this disaster might never have happened.
Yes, that's very true. Who would have thought that doing everything possible to deregulate, and the underlying philosophy that regulation is unnecessary, would result in insufficient regulatory action?
Unfortunately firing the new MMS head for not cleaning up the cesspool of corruption and deliberate inefficacy that she inherited was only just the beginning of a long, long road to fixing this.
Re:So? (Score:5, Insightful)
If the moratorium continues, the drilling rigs will move where they can be utilized, and they'll stay there while there is work. Most won't just sit around and wait the moratorium out and hope it isn't extended. There are limited numbers of deep water drilling rigs, they take time to build, and nobody wants to build replacement rigs to meet a spot shortage because they've all moved to other areas due to this. So there could be a longer term impact even if the moratorium does end in 6 months.
So they are saying "if you don't let me play I'm going to take my toys and go home"?
Either there's oil (money) to be found in the gulf or there's not. If there is, then there will be companies ready to drill when the moratorium is lifted. Maybe it will take them 6 months to relocate equipment there, but they'll definitely be back.
Delaying a few dozen exploratory wells for a year while they investigate this accident and have a better idea of the cause *and* have time to enact new rules to prevent the same scenario from recurring doesn't seem like a bad course of action.
Re:So? (Score:4, Insightful)
Re:So? (Score:5, Insightful)
Ugh (Score:1, Insightful)
Another fucking case of another fucking crooked Federal judge.
I guess I better shut up, the last time I said anything bad about a federal judge he sent the Marshal Service to my house to bug me.
True story.
People want to blame our presidents (both past and president) for this country going to Hell in a handbasket when it's really the Judicial branch that's the problem.
Re:So? (Score:3, Insightful)
Do you think that six months of wait on 1/100th of the Gulf wells will destroy the economy?
It shouldn't, but I'm sure they'll use that as an excuse to jack up the price of gas.
Re:As always, units matter (Score:3, Insightful)
Keep in mind this is the first major off shore drilling accident in almost 20 years, how many other industries can claim as good of record. This was just a particularly bad one.
Re:So? (Score:3, Insightful)
US oil companies like B(ritish) P(etroleum) and (Royal Dutch) Shell, you mean?
Re:So? (Score:4, Insightful)
Re:Yeah - but does the reasoning make sense? (Score:2, Insightful)
but the question still remains. Does his ruling make sense?
No, the question is, is the moratorium illegal. Not, does it make sense economically, or, is it fair, or, is it logical. Those are not the questions the judge should be deciding. Judges rule on what the law is, so I ask, what law did Obama break when he initiated the moratorium?
Re:So? (Score:3, Insightful)
I love all the people that are acting like stopping related projects is this unprecedented move.
It's the same thing that happens in any other emergency when "Something bad happened and we're not sure what" FAA grounds plane because of suspected defects, FHSA will temporarily say "Don't drive trucks of such and such years", et al.
The fundamental statement by the judge here, that this isn't standard protocol, is factually wrong. When you have an emergency that casts doubt on the procedures you've been using . . . you stop related operations till you find out what the hell happened.
Unless of course you're in the oil industry, and the accident has wiped out the economy and devastated the environment. Then you get conservative morons with their typical sense of entitlement insisting they shouldn't be treated the same way as other people.
It's like dealing with spoiled kids.
Pug
Re:So? (Score:3, Insightful)
You can't be for real. You're more worried about the .01 of wells in the Gulf that are under the moratorium and the .01 of the oil rig workers than you are about the .99 of the people along the Gulf who are adversely affected by the crude that's gushing into the Gulf and fouling communities from Texas to Florida.
You know, there are corporations that would gladly destroy the environment and peoples' lives to make an additional 3% profit this quarter, and they get away with it because there are fools who will do their PR work for them, just because Limbaugh, Beck or Hannity told them to.
Man, you need to be ashamed.
I would have liked to have seen all BP assets in the US nationalized until every single American, every single waitress at Denny's who's gonna lose tips because vacationers aren't coming to the Gulf because of the thick crude oozing up on the beaches, is made whole.
It's getting to the point where every year we continue to rely on combustion of fossil fuels is a year that we go deeper into a moral deficit. When we finally decide enough is enough, and actually put some serious money and effort into alternative energy sources (not just solar car races in New Mexico), people are going to look back and wonder what kind of monsters we were, knowing as we do the damage we are doing and not just sitting idly, but protecting our dysfunction like so many battered spouses.
Re:So? (Score:4, Insightful)
Actually it's the folks on the Gulf coast who are most concerned about the moratorium, because they're the folks who make their living supplying the rigs that were put under the moratorium.
Oh, I don't know. I'm from the Gulf Coast originally, and everyone I know there is spitting mad about the spill, and would be perfectly happy to see the rigs gone, lest this get worse, or happen again, and the various malefactors severely punished. I don't know anyone opposed to the moratorium. And if oil rig workers would lose their jobs as a result, why not let them get jobs cleaning up the spill, just like the fishermen are having to do.
Re:not a problem (Score:5, Insightful)
Fallacy. You assume there is just a single point of failure. There was not.
Something is wrong with the current way of doing business.
Something is wrong with current drilling methods in US shores.
Something is wrong with disaster recovery.
Going about business as usual without identifying what is wrong ion all those process is fool hardy.
Re:As always, units matter (Score:3, Insightful)
Except the Deepwater Horizon is not the only oil well leaking in the Gulf of Mexico. From the Mobile Press Register dated Jun 7:
In addition, I don't think we can honestly say this is the first major off shore drilling accident in almost 20 years when 3000ft+ drilling hasn't been performed within the Gulf of Mexico that long.
A slide show presentation given at a Offshore Technology Conference on May 2, 2001 by Chris Oynes (the Regional Director of the Minerals Management Service) made it appear that drilling wells beyond the 3,000 ft depth was a relatively new activity in the Gulf of Mexico. In fact the deepest oil well startup given during his presentation was the single Diana / Hoover site at 4,679 ft in 2000.
According to Oynes presentation in 2001, the oil production growth was given at:
1995: 55 million barrels per year
1996: 72 million barrels per year
1997: 108 million barrels per year
1998: 159 million barrels per year
1999: 225 million barrels per year
2000: was estimated to be 217 million barrels per year
The vast majority of these "deepwater oil wells" were within the 500 to 1000 ft leasing areas.
The industry was very excited about the continued growth in oil production that could come from the much deeper oil well sites.
An article from the Oil and Gas Articles dated April 13, 2006 talked about the expanding deepwater drilling within the Gulf of Mexico whose growth accelerated in 2001, and MSNBC ran a similar story in September 2006 which stated:
I especially like the following from the same article:
During the same time period (2006) CNBC ran a story:
I think lumping the oil drilling performed at depths greater that 1500 feet with the more numerous (and older) drilling at depths between 500 and 1000ft gives the illusion tha
Re:As always, units matter (Score:5, Insightful)
How many other industries have consequences of the same magnitude when they fuck up?
Re:Pissed about this whole process (Score:5, Insightful)
Oil industry apologists are saying we're all being whining, ungrateful children because we reap the benefits of cheap energy but bash the poor, hard-working people who put the gas in our cars. But what they don't mention is the fantastic amount of money spent buying this oil-dependent reality in the first place.
You know, its common for people to say how corporations, and especially oil companies, throw around lots of money to protect their interests and enact legislation and all that...
...but I just dont see it being true in the case of the oil industry. I see an industry that was forced to drill many miles off the coast in 5000 feet of water when they could have (and very much would have) drilled closer to shore in shallower water, where it was easier, cheaper, and knowledge was greater.
Apparently you would have us believe that the awesome power of oil money was used for everything but cutting costs.
Every few years Congress goes up-in-arms over the oil industry even when no disaster happens, such as the recent cry for a 'windfall tax' on them, even though their profit per revenue was significantly less than the governments share of the pie, and also significantly less than most other industries.
The oil industry has been the bitch of the government for decades. If you have evidence that this is not the case, please present it. I am thinking that, no, you don't... you are just blowing wind.
Re:Pissed about this whole process (Score:4, Insightful)
Because those on the right are fucking idiots, that's why. Those on the left are pissed that Obama has left BP in charge of the response effort, that Obama is continuing Bush's wars, that Obama is continuing Bush's abuses of executive power, and pissed that his policies consistently place a higher priority on Wall Street profits than the well being of the working class.
Whereas the right whines about concentration camps, socialism/communism, and started off Obama's presidency by protesting taxes right after Obama actually made good on one of his campaign promises and pushed for a tax cut on the middle class. And then spent the next few months parading around with signs like "keep your government hands off my medicare".
Re:Pissed about this whole process (Score:1, Insightful)
How about I mod you down instead for being illiterate. Here's what you're missing - jollyreaper is saying that Obama's actions to date have been much, much weaker or ineffective than what he could or should do.
The right wing, however, believes that the President has already gone overboard in his response. There's no contradiction in that.
Note that I'm not saying that jollyreaper is correct, only that he's not contradictory. And his post may be a rant but that doesn't mean he doesn't have a point ( or several ) or that he hasn't made clear recommendations
Re:So? (Score:1, Insightful)
No, it's like this:
Your car is poorly maintained and unroadworthy, and your brakes fail, causing you to crash into someone. The government says no one can drive any cars, no matter how well maintained, until the government changes its mind. Does the government have to pay for everyone's cab fares until they get around to relaxing the ban?
Re:not a problem (Score:3, Insightful)
I'm just saying that if another company doesn't swap those BOP batteries out on schedule and cuts corners like BP did and there's another blowout in the next couple of decades, people will come after them with pitchforks.
They didn't come after BP "with pitchforks", despite this being eerily similar to Ixtoc. What makes you think that story won't repeat in 30 more years?
Re:So? (Score:2, Insightful)
I would have liked to have seen all BP assets in the US nationalized until every single American, every single waitress at Denny's who's gonna lose tips because vacationers aren't coming to the Gulf because of the thick crude oozing up on the beaches, is made whole.
We live in a country of laws, not in a communist dictatorship. Our government cannot simply wave a magic wand and begin confiscating property. Instead, there will be due process in a separate court case in which BP will pay for the damage that it caused.
In the case of the drilling moratorium, the government wanted to go one step beyond what you want, which was to shut down businesses BEFORE they had done anything wrong. Fortunately we don't live in a communist dictatorship (yet) and the judge determined that the executive branch cannot simply wave its magic wand and do whatever it wants without any particular reason.
Re:Why stop offshore drilling now? (Score:3, Insightful)
o sense in stopping now. Imposing a drilling moratorium now is like shutting the barn door after the horse has run off.
I dare say that shutting the barn door is the only reasonable thing to do if there are more horses still remaining in the barn!
Re:So? (Score:3, Insightful)
Of course, they could have turned down the President. Of course, in that case they...could have had their regulatory ass handed to them for the next how ever many years this administration was in power over every little infraction.
Sure sounds like a thuggish shakedown to me. "Nice company you got there...it'd be a shame if something happened to it." The fact that everyone is (understandably) hating on BP right now makes Obama's shakedown no less despicable--and a very dangerous precedent (though admittedly with this president the precedent of shaking down corporations has already been set, this is just taking it to new levels).
Comment removed (Score:4, Insightful)
Re:So? (Score:3, Insightful)
Not at all. They're saying these toys are costing a bunch of money every day setting on the shelf when they could be drilling producing wells in my field over here, so let's go. Home moves and drilling holes to completion takes a finite amount of time.
There is money to be made in the gulf, but it isn't the only place to play. There is money to be made all over. I agree they'll definitely return assuming the political climate doesn't disintegrate. At this point that is an open question that nobody knows the answer to because nobody can make an accurate guess as to when the rupture will be completely sealed and what the total damage will be.
I think most of the drillers understand best practices. BP appears to have cut corners and they won't be the last to do so, regardless of the rules in place. Rules are fine. Oversight gets iffy with the small number of qualified people that the government is likely to employ. I don't really think additional delay will make things magically fail safe.
Re:So? (Score:3, Insightful)
I would have liked to have seen all BP assets in the US nationalized until every single American, every single waitress at Denny's who's gonna lose tips because vacationers aren't coming to the Gulf because of the thick crude oozing up on the beaches, is made whole.
We live in a country of laws, not in a communist dictatorship. Our government cannot simply wave a magic wand and begin confiscating property. Instead, there will be due process in a separate court case in which BP will pay for the damage that it caused.
2008 and 2009 calling. The US government owns AIG, banks, GM, ad nauseam. It is already on the road to socialism if not communism. And both Democrats and Republicans are responsible. I'd rather BP be taken over than have Tesla have to compeat against a government bailed out Detroit. BP deserves it whereas Tesla didn't do anything to cause the problems Detroit has.
In the case of the drilling moratorium, the government wanted to go one step beyond what you want, which was to shut down businesses BEFORE they had done anything wrong.
Yea, we should wait until another oil spill happens. Nah, a dozen more. Do nothing, do nothing, until it's oil in your house.
If you really believe BP will be made to pay, you can learn about the Exxon Valdez spill. More than 20 years later wildlife still has not recovered. Nor have the fishermen been paid. Plus oil is still found on beaches. No, if history is any indication BP will get away with wrecking peoples' lives as well as the environment.
Falcon
I believe you just described a shakedown (Score:4, Insightful)
Give us the money now or things could get hard for you later.
Re:So? (Score:5, Insightful)
would be perfectly happy to see the rigs gone, lest this get worse, or happen again
Honest question: Why do people seem to accept this argument as valid for oil rigs, but using Chernobyl as a reason against nuclear is (generally, and rightfully) rejected as irrelevant and a piss poor argument?
Re:So? (Score:4, Insightful)
Because after Chernobyl the design of still operating RBMK reactors (and in fact all reactors) was improved to the point that a repeat disaster should be near-impossible.
But looking at the oil spill, we had the same problems in 1979 off the Gulf of Mexico. Since then the capability to respond to this type of problem hasn't improved. The pre-revised BP document shows they knew this. Same story in Alaska - oil pipelines are not being well maintained. That's a repeat of 1979 too.
Nuclear industry has learned their lesson and moved on. Oil industry is still crossing their fingers that risk/reward will fall in their favor.
Re:So? (Score:4, Insightful)
If western nuclear plants were built the same way Chernobyl was built then I WOULD be up in arms about it, and I'm one of the strongest Nuclear supporters you would find.
Likewise, if all the other oil rigs had relief wells drilled in advance, then I'd have no problem with them continuing operating.
The difference between the two situations is that with Chernobyl we have made damn sure all nuclear plants we build have the safety features needed to prevent a similar disaster. With the oil rigs, the same is not true. Many of them still lack safety features (pre-drilled relief wells ) that are considered standard in many parts of the world.
Re:So? (Score:4, Insightful)
Because many years after Chernobyl, it is clear that it was a uniquely horrible reactor and beyond idiotic test procedure that lead to the accident, and that technology has developed to the point where none of its failings are in any way relevant.
In contrast, every rig in the gulf is using the same safety technology that failed at Deepwater Horizon, and many were certified by the same corrupt regulators who gave Deepwater Horizon a clean bill of health despite failing and deliberately disabled safety equipment. There is absolutely no reason to believe that this rig is unique or exceptional, other than that it is the one where the chickens came home to roost.
Chernobyl was an outstanding argument to stop construction of Chernobyl-style reactors (obviously), and to reconsider regulation of reactors (particularly in Russia) to make sure nothing as stupid as the disaster-causing test would be allowed.
Similarly, if in twenty years it's clear that the Deepwater rig was unique, and technology has moved beyond the current state of the art to a regime of "inherent safety" like nuclear, then Deepwater will no longer be a good argument to stop drilling.
In short, the difference is context.