Posted on 08/08/2006 4:38:02 PM PDT by John W
WASHINGTON - When British Petroleum (BP) shut down a vital oil pipeline, the company blamed "unexpectedly severe corrosion" in transit pipes. Yet only five months ago, BP's aging pipeline created the largest-ever oil spill on Alaska’s North Slope.
Federal regulators blamed the spill on "internal corrosion" and said in some areas the walls of the pipes were so corroded they were almost paper-thin.
So critics and industry experts say the latest problem was hardly a surprise.
"I think this was predictable and preventable," says Phil Flynn, an energy analyst with Alaron Trading Corp.
In fact, allegations about BP's maintenance practices have been so persistent that a criminal investigation now is under way into whether BP has for years deliberately shortchanged maintenance and falsified records to cover it up.
The criminal probe was triggered by Chuck Hamel, a longtime nemesis of the oil companies and advocate for oil workers.
"They're playing the Russian roulette up there," he says.
Hamel says a dozen past and current BP employees came to him claiming they'd been told to cut back on a chemical put into the system to retard rust and corrosion, and to falsify records. A federal official confirms that many of these workers have also talked to the FBI.
(Excerpt) Read more at msnbc.msn.com ...
Replacement should be an ongoing process. Build a one-mile bypass pipe and replace the main line. When that section is complete, move the whole operation down the line and work on the next mile of pipe.
Doing it that way can't be any more expensive than the amount of money BP claims to be "losing" every day the corroded line is shutdown. It's called common sense and planning.
If any of this BS was truly on the level, every BP employee and manager in charge of maintenance and upkeep would be replaced. This is a dog and pony show to keep pump prices jacked up.
Our lines are all wrapped. Generally it's a break that is the real revealer. No system is pefect but slapping in a temporary by-pass and a couple extra valves seems like an alternative.
People pay a buck for 12 oz of water and think nothing of it. Too lazy to fill a bottle with tap water. Walk to the store to save gas?? Yeh, right!!
First off, BP is not the average corporation...The country is not dependent on the Keebler or the Chef Pierre Pie corporations to keep afloat...We don't have to eat pies and cookies...
AND, my complaint was not on the amount of their profit...My complaint was that since this company has such a massive top line, it certainly could have spent some of the massive profits on maintenance and replacement of bad parts especially since the system was well beyond it's life expectancy...
With the massive profits, I wouldn't be surprised that BP will actually save money thru tax loopholes with the dowtime to repair the system...
I would suspect this crude goes into, or has the capability to go into storage tanks somewhere along the line...I assume that would have been part of the initial planning stage to compensate for any maintenance operations...
A scheduled repair would be far less costly in downtime compared to shutting down and replacing the entire piping system...
To all of you out there commenting on BP and its ineptitude. This subject is/was being discussed earlier today at this link: http://www.freerepublic.com/focus/f-news/1679898/posts
One of the points discussed there happens to be which pipeline was the problem. I have noticed that the current discussion does not even come close to where the problem lies.
So you contend that they haven't spent anything on maintenance or replacement parts over the last 29 years. Interesting, but I'm certain that is not true.
With the massive profits
It sure sounds like you have a problem with big profits, but you don't even know if they are massive if you can't tell us their net percentage or return on investment. Are you sure you're posting on the right website? Here's a tip for you - if their profits are so massive, you should buy their stock, then you can benefit from them instead of complaining. But don't make too big of a return or somebody will start complaining about you.
I wouldn't be surprised that BP will actually save money thru tax loopholes with the dowtime to repair the system
I'm sure BP is overjoyed that they have shut down production and are losing revenue at the rate of $28 million per day. With those huge loopholes, do you think there's any incentive for them to even start shipping oil again?
How is the crude supposed to get to or leave the tanks if the tranport pipeline is leaking?
The same way it got to whereever it goes before they shut the lines down...
I'm not sure...Is this the 'money is my god' website???
LOL.
Nope, it's the "profits are not evil" website.
How does it get to wherever it goes with the lines shut down?
In case you haven't heard, Saudi Arabia and Mexico are making up the shortfall while the pipeline is down.
So, your tender ass won't be inconvenienced, after all.
Doesn't matter...The fact remains, knowing the life expectancy of the line, and knowing it was years beyond it's expected life, BP should have made provisions to repair/replace the line with minimal downtime...And obviously cash flow wasn't a factor in the decision to do nothing...
Absolutely right.And there is a criminal investigation regarding what went on which is the focus of this story.
--The American people are being screwed over by big oil. If they fixed that pipeline next month gas prices would never drift back down to what they were a few weeks ago. We are being conditioned like cattle to gradually accept the higher prices. What drives me crazy is the fact that the vast majority of people couldn\'t seem to give a care less--
How can you say such things? Oil companies would NEVER do anything underhanded to boost their profits. (sarc) Your penance is to face Wall Street 5 times a day and chant Market Akhbar, Market Akhbar!
Seriously, though people in our conservative movement have to stop drinking the free-market kool-aid the oil companies are handing out. Ever notice how you never see oil companies advertise for more drilling in ANWR or the coasts? Oil is like diamonds. The more you find, the less valuable they become. It is in the oil industrys interest (paradoxical but true) to have the envirowackos prevent oil drilling in key areas. It is good to see someone on these boards who understands the big picture.
Where was the Congressional oversight before the problem?
Well the cows would create a lot of methane (worse than CO2 in the greenhouse effect), so they might have a point?
"Being shut down for months at a loss of $28 million dollars per day in revenue doesn't sound like greed"
Hmmm. Let's check that math, shall we? BP pumps 120,000 barels a day out of that pipe (the rest is Exxon). at $75 a barel they stand to loose a mere $9m per day.
But don't sell your BP shares just yet: BP sells 4 million barrels of oil a day; after their announcement the prices jumps $2.22 a barrel, so that makes an additional $8.9m a day. Then add to that the gains that ARCO (a BP subsidiary) will make in California - where most of the oil from Purdoe ends up - selling gas to Joe public + the refining margins and you have something like break even.
Long term it adds yet another reason for oil prices, refinery margins and gas prices to stay high, which maintains the share price nicely!
Is it a conspiracy or just amazing incompetency at a company that has blown up to of its own refineries and poured 2 days worth of oil into the Arctic?
You decide!
cheap for a company that sells
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.