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BP crisis management oil spill
BP crisis management oil spill
BP crisis management oil spill
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Executive Summary
Business risk management has been a widely crucial tool for firms to include in their operations and its importance cannot be overlooked. In the case of British Petroleum (BP) Gulf of Mexico Oil Spill in 2010, there was negligence and lack in the contingency plan and response of the company to the risks that arose. It became evident in this analysis that BP’s manner of handling the incident had a massive financial implication that ensued negative public perception and company reputation and value.
The result of the analysis showed that BP could have had a better grip of the incident if they responded it with both a crisis communication plan and transparency. Their seeming indifference and unpreparedness reflected a perception worse than the incident itself to the public.
A further look at facts of the incident, analysis of the risk management issues and evaluation and recommendation of BP’s response to the crisis will be presented in this report.
Introduction and Aims
On the summer of 2010, the petroleum industry was shaken by one of the largest disasters in history known as the BP Deepwater Horizon Oil Spill. This resulted in the killing of eleven people, injuring of seventeen and an immeasurable damage to the ocean and the surrounding communities. BP had to immediately respond to the crisis and handle their financial and reputational risks.
The purpose of this report is to assess BP’s crisis management and communication plan to primarily analyze the possible failures in their response through a gathering of secondary data collected from various sources such as online journals, newspaper articles, blogs and case studies.
The researcher seeks to establish answers to:
1. What were the main risk management...
... middle of paper ...
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On April 20, 2011, an oil rig in the Gulf of Mexico exploded on British Petroleum’s (BP) Deepwater Horizon. As a result, of the 126 BP crew members aboard, 11-15 were reported missing. Six days later, underwater robots reveal at least two leaks are dumping 1,000 barrels of oil into the Gulf per day. Consequently, this would become one of the worst oil spills in the history of the United States and perhaps the petroleum industry. This recent Oil Spill portrays one of many dilemmas BP has faced as it scrambles to expand and globalize itself as a transnational corporation in the world economy against other oil and gas companies. Although this disastrous event has affected BP negatively, the company has found a way to overcome it, while still becoming the 6th largest in the world; it continues to do this by offshoring, outsourcing, and merging with other oil and gas companies, three key strategies BP has been using since its establishment in 1909.
The British Petroleum (BP) oil spill in the Gulf of Mexico was one of the worst ecological catastrophes in human history, causing vast damage to a fragile and beautiful ecosystem while at the same time calling attention to the deficits in current approaches to energy prospecting, risk management, and cleanup. This analysis of the Deepwater Horizon explosion and oil spill will devote attention to the following questions: (a) What kind of technology is in use for deep-sea oil extraction, what are the factors that accounted for the BP catastrophe, what were the statistical components of the spill in terms of volume and concentration, and what was the spatio-temporal scale of the oil spill? (b) What were the environmental (physical, biological, hydrological, and atmospheric) impacts of the oil spill, in addition to the economic and social impacts? (c) What were the scientific, technological, and policy solutions implemented by various actors to pursue the cleanup of coastal areas, wildlife, and wetlands damaged by the oil spill? (d) What is the feasibility of long-term biodiversity conservation measures and the limits of such solutions?
All the above stakeholders impacted by oil spill but differently unfortunately, the oil spilled into the ocean and killing all the fish and wash off the coast spread through rivers, affecting the fishermen and BP company affected by because they need to clean all this was to be able to cover the costs, and bad publicity the oil spill has affected governments w...
This essay revolves around this incident and BP’s response, and analyses the effectiveness of BP’s crisis communication with relevant theories and concepts in the area of communication management. This essay
On April 20, 2010, an explosion occurred in the Gulf of Mexico, on the Deep water Horizon oil drilling rig which rented by BP. There were 126 workers on board at the time of the explosion. Fifteen of them were injured, and eleven died. Two days later the oil drilling rig sank, the leaving oil spewing into the Gulf. This was the largest marine oil spill in the history of the petroleum industry, the oil had been leaking for almost three months.
Weeks, Jennifer. "BP's Financial Pain From Spill Is Just Beginning." CQ Researcher 21.29 (2011): 688. MAS Ultra - School Edition. Web. 17 Feb. 2014.
crisis did hurt the company but their response was quickly active, they went directly to the media
British Petroleum (“BP”) is the company that is being blamed for the incident. Employing 80,000 people, BP is an international oil company that puts different technology to use for finding oil and gas under the Earth’s surface. One of the oilrigs, Deepwater Horizon has drilled 35,000 ft. making it to be the deepest drilling of oil and gas (Walsh). Deepwater Horizon was drilling in the Gulf of Mexico about 52 miles southeast of Venice on Louisiana's tip. After the explosion, helicopters searched for 11 crewmembers that reported missing. 17 people were injured (BP Internal Investigation Team). A day later, the rig was found upside down (BP Oil Spill Timeline). The cost to clean up the damage is approximately $760 million (Walsh).
Since 2005, PBS reported of four major incidents involving BP. The first incident was an explosion that killed 15 people at BP’s Texas refinery in Texas City. BP did not replace the old blown-down drums, a safety feature, with safer, modern flares to save money. An investigation commissioned by former Secretary of State James Baker concluded that this incident was preventable and BP failed in putting safety as a priority. In the Alaska incident, 260,000 gallons of oil leaked from a BP oil pipeline on Alaska’s North Slope in March, 2006. Later investigations found that BP hired uncertified inspectors and kept records poorly. BP agreed to re-inspect 10,000 points and corrected their problems. In July of 2005, a BP oil platform, called Thunder Horse, toppled after Hurricane Dennis. After an investigation, BP found that their engineers had incorrectly installed a number of valves that supported the rig. On January 2007, the Minerals Management Service cited this accident was caused by human error (PBS). In 2010, the Deep Water Horizon rig exploded, leading to oil leaking into the Gulf of Mexico. Again BP is ...
The 2010 BP oil spill ultimately affected both people and the environment, polluting and damaging large areas and vast populations of wildlife. The BP oil spill caused took a toll on marine life, human life, and the economy, including the fishing and tourism industry in the Gulf of Mexico. Many factors such as Petroleum toxicity, oxygen depletion, and much more can be viewed as the major sources of the disaster which led to the negative impact on wildlife. It is very clear that an oil spill is recognized to be a disaster for both for people and the environment, any tragedy of this scale would clearly bring forth regulations that will attempt to prohibit the same calamity from happening again.
Despite the abundance of strategies available, researchers have found that William Benoit’s theory of image restoration—later titled image repair—offers a more useful framework for the understanding of corporate crisis situations (Benoit, 1997). Considered the dominant paradigm for image repair discourse, the theory of image restoration is grounded under the premises that communication is a “goal-directed activity.” The first goal aims to maintain one’s favorable image, while the second goal aims to restore or protect one’s reputation (Benoit, 1995, p. 63-71). To ensure these goals where met, Benoit designed a typology that provided crisis communication practitioners with five general defense strategies to employ (separately or collectively) during a crisis to mitigate and or repair damages created by a crisis. Those strategies are: (1) denial, (2) evading responsibility, (3) reducing offensiveness, (4) corrective action, and (5) mortification.
On April 20, 2010, the Gulf of Mexico experienced a disaster unprecedented in scale and environmental impact. Fifty miles off the coast of Louisiana in the deep waters of the Gulf of Mexico, a BP drilling rig suffered an explosion that claimed eleven lives and caused the rig to sink over 5000 ft. to the sea bed floor. This was the beginning of the BP oil spill which spanned over eighty seven days, releasing an approximate 2.3 million barrels of crude oil into the Gulf of Mexico. Although the flow of oil into the Gulf was contained July 15, 2010, the lasting effects of the oil spill on the environment continue to be devastating and widespread. (Kirkwood 1)
The Exxon Valdez and the BP oil spill were caused by different disasters but had just as great of effects. On March 24, 1989, the Exxon Valdez oil spill began to reek havoc on the Pacific Ocean. The oil tanker, Exxon Valdez, left from Valdez, Alaska and was headed for Los Angeles, California. The tanker ran aground on Bligh Reef in Alaska. After six hours of being grounded, the Exxon Valdez spilled about 10.9 million gallons of oil (53 million gallons aboard). The BP oil spill occurred a little differently. On April 20, 2010, the Deepwater Horizon oil platform exploded and caused the largest marine oil spill in history. The platform sank about 5,000 feet underwater. The BP oil spill poured 4.2 million barrels of oil into the Gulf of Mexico. These oil spills are largely compared but were cause by completely different events. They had similar effects/damage, however.
On April 20, 2010, the Deepwater Horizon oil rig, located in the Gulf of Mexico exploded killing 11 workers and injuring 17. The oil rig sank a day-and-a-half later. The spill was referred to as the Deepwater Horizon oil spill, BP oil spill, Gulf of Mexico oil spill, and BP oil disaster. It was first said that little oil had actually leaked into the ocean but a little over a month later the estimate was 12,000-19,000 barrels of crude oil being leaked per day. Many attempts were made to stop the leak but all failed until they capped the leak on July 15, 2010, and on September 19 the federal government declared the well “effectively dead.” In the three months that it took to finally put a stop the leak, 4.9 million barrels of oil were released into the ocean. The spill caused considerable damage to marine and wildlife habitats and the Gulf’s fishing and tourism industries. The White House energy advisor, Carol Browner, goes as far to say that the Deepwater oil spill is the “worst environmental disaster the US has faced.”
The communication process is not something that begins when a crisis rears its ugly head rather it is a process that takes place in preparing for a crisis before it happens. While the term crisis represents a blanket term used to describe many situations, each situation is unique, thus presenting different obstacles to overcome. However, with a well-established advanced plan in place an organization places itself in a position to overcome and work around obstacles. The development of a comprehensive crisis management plan is one achieved through effective communication where each member of the crisis management team has an advanced shared understanding of his or her role and responsibility during a time of crisis (du Pr'e, 2005).