British Petroleum Oil Spill - Essay Example

?BRITISH PETROLEUM OIL SPILL British Petroleum Oil Spill Introduction On the 20th of April, one of the worse, if not THE worst, oil spill disaster in the history of man occurred. The Deepwater Horizon drilling rig being leased to British Petroleum (BP) in the Gulf of Mexico exploded and killed 11 people. This oil spill set off different kinds of damage to the environment and to the livelihood of the people along the Gulf Coast. The oil platform which was being operated by Trans-Ocean sank after two days. The oil well went on to leak into the Gulf of Mexico for three months and as a result, it created the largest oil slick ever recorded. The bad publicity caused by the oil spill caused BP corporate shares to plummet, and this was made worse by President Obama’s public condemnation of the company. The company CEO Tony Hayward was largely criticized and blamed for the incident. He subsequently stepped down from his post several months after the oil spill. Based on the above situation, this paper shall now assess the public relations (PR) implications of the oil spill on BP. It shall also evaluate whether the organization could have handled the situation better and if it could have, its different actions in this regard. The main issues of the event shall be presented, along with the individuals and state affected by this oil spill. This paper shall evaluate how BP handled this disaster. A fair and balanced discussion shall be undertaken for this issue, mainly presenting the company’s side as well as the public’s side on this issue. After presenting both sides of the issue, this student’s position and judgment shall also be presented. This paper is being undertaken in the hope of establishing a comprehensive and academic discussion on the subject matter. Discussion PR implications for BP The PR implications of the oil disaster for BP present a negative image of the company. In fact, with just a few words released to the press, it seems to negate its mantra, ‘BP cares.’ The way BP handled the disaster in terms of public relations did not help the company in any way; and their PR efforts did not portray BP in the best of light. It even portrayed them as an uncaring and incompetent company (Berr, 2010). Before the US Congress Hearing, Tony Hayward repeatedly blamed others for the disaster; and he, in behalf of the company, hardly took any responsibility for the disaster and for the decisions the company made which led to the explosion. A month after the explosion, BP claimed that the environmental impact of the oil spill would be “very, very modest”. In the immediate aftermath, and now months after the initial oil spill, its impact to the environment has already proven to be monumental (Hutchison, 2010). In fact, its impact is set to last for many more years to come. BP also did not release accurate statistics and reports to the public. Furthermore, it first admitted that it has underestimated the amount of oil which was leaking. It was unable to express how much was spilling, but estimates it at about 5,000 barrels. The White House negated this figure by expressing that it was closer to 60,000 barrels (Hutchison, 2010). In the aftermath of the disaster, BP’s share prices fell by about four percent. This was the same day when the US accused BP of downplaying the impact of the spill. Two months into the oil spill, it was revealed that BP was given permission to drill in the Gulf of Mexico after it presented documents which basically expressed that it was capable of dealing with oil spills even larger than the one it was facing (Hutchison, 2010). These revelations provided more sources of embarrassment for the company. Tony Hayward was criticized for his insensitivity when he later remarked that he would “like [his] life back”. Even if he apologized for his comment, the damage to BP’s image was already done. BP was wiped off 12bn pounds on the day that Barack Obama declared that he was now launching a criminal investigation of BP’s handling of the disaster (Hutchison, 2010). Hayward also did not handle his appearance before the Congress well. Furthermore, Hayward caused further outrage among the people and concerned authorities when he was photographed spending the day sailing off the Isle of Wight (Hutchison, 2010). BP’s satirical Twitter account also released occasional statements which further supported its insensitivity to the oil spill and its devastating impact. Statements like, “we regretfully admit that something has happened off of the Gulf Coast. More to come,” and “surprised ourselves by getting emotional today off the coast. Turns out the wind blew dispersant in our eyes” (Hutchison, 2010). Their attempts to make light of the situation did not sit well with the general public and with authorities. Even if they shut down their Twitter account, their image as an insensitive company was already fully ingrained in the minds of the people. The fact that the BP staff also kept manipulating photos and posting them in their website drew the ire and criticism of the people (Hutchison, 2010). The pictures were meant to illustrate BP’s efforts in resolving the oil spill. Their poor efforts at photoshopping the pictures however was exposed by bloggers who pointed out inconsistencies in the pictures. The above actions are all PR blunders for the company and they all exemplified how NOT to handle situations similar to this oil disaster. The oil spill is bad enough without BP’s PR management worsening the situation and making it harder for the people and the general public to be sympathetic or helpful in resolving the issue. Based on the above blunders, there are so many ways in which BP could have handled the situation better. Since they do not set the standards that high, suggestions in this regard are as simple as: not commenting to the press or not releasing any statement to Twitter or to any other media, not taking a cruise while one’s company is facing a major disaster, or just releasing a standard statement like, “we are handling this to the best of our abilities.” These are suggestions which can go a long way towards presenting the picture of a capable, sensitive, and concerned company. By avoiding the above blunders, the PR disaster of the BP can be prevented and a more capable image of the corporation can be shown to the world. From the very first, BP could have manifested a strongly capable image to the world. It could have aggressively implemented various solutions to contain the oil spill; it could have reassured the people that it would do its best to compensate for their livelihood losses; and it could have expressed its firm intent and dedication towards addressing the environmental implications of the disaster. After these plans were laid out, a definite course and plan of action could have been expressed to the public and to the government authorities. Instead of tweeting satirical comments or allowing its CEO to utter insensitive remarks to the press, more solid and aggressive leadership strategies could have been applied by BP in order to reduce and address the impact of the oil spill disaster. Such methods manifest the leadership capability and dedication of BP towards achieving company goals and in assuming its duties as a socially responsible corporation. Key issues of the disaster The key issues of the disaster revolve mainly around the prolonged time upon which the leak was stopped. This showed how much BP was ill prepared to resolve oil spills and oil leaks (Nemana, 2010). Its claims indicating its capability in resolving oil spills were not accurate. Secondary to its failure to resolve the oil spill disaster was the fact that it did not have sufficient control over what Tony Hayward was stating to the press, statements which were insensitive and which were not well thought of under these circumstances (Luce, 2010). It also did not have sufficient control over its staff – in their use of their Twitter account, in their photo-shopping, and in their efforts to portray a capable corporation (Luce, 2010). People affected in the issues 1. On the oil disaster issue itself, the people most affected are the fishermen and the residents along the Gulf Coast whose shores and waters were contaminated by the oil spill (Adam, 2010). Fishermen along the Gulf Coast lost their livelihood after their fishing areas got contaminated and the fishes and wildlife were gradually decimated (Adam, 2010). Businessmen who relied on the tourism business in the Gulf Coast region also lost a huge number of their tourists. Many foreign tourists cancelled their trips to Louisiana, Mississippi, and Alabama because they feared that the oil slick would reach the shores and beaches (Retire Early, 2010). In general, other businesses in the Gulf Coast area suffered a drop in sales and profits. Since livelihoods were lost in some regions in the Coast, some residents were prompted to move and to abandon these regions in search of greener pastures and alternative livelihoods. With fewer people, fewer profits in businesses were seen. Fewer profits meant potential bankruptcies in many of these businesses (Assar, 2010). Long term effects mean that many of these areas would likely be abandoned; unemployment would be rampant and those left would likely suffer from poverty and financial difficulties. The company itself is affected by the disaster. The company, including its shareholders have to bear its losses (Assar, 2010). They would now suffer lesser shares in profits and face risks of diminished value in their shares. BP handling of issue From the very start, BP did not handle this issue well. It did not have sufficient preventive measures and contingency measures to face oil spill disasters (Nemana, 2010). BP basically did not know how to plug the leak and to contain the oil slick. Its efforts to plug the leak were not sufficient and were very much ineffectual (Nemana, 2010). It showed a lack of preparedness and it showed BP’s incompetence in safeguarding against oil spills and other possible operational issues. Furthermore, BP, through its CEO, kept putting the blame for the spill on other people and on the oil rig company (Nemana, 2010). Its efforts to control and contain the oil slick were also ineffectual. They did not have sufficient measures to contain the oil slick and as a result, the oil slick widely covered the Gulf Coast and many of the coastal communities were also affected by the oil slick (Nemana, 2010). In defence of BP In defence of BP, investigators were able to establish that Halliburton supplied cement slurry of its own device which was recognised to be unfit for the purpose it was utilized. Tests further revealed that the cement was prone to break down. Responsibility for the leak can also be laid at the feet of Transocean (The Economist, 2010). Transocean did not see and check that when oil and gas reached the rig, gas was spewed back into the rig. Transocean also did not check that the blowout preventer failed to close the flow when activated just before the explosion (The Economist, 2010). In BP’s defence, the disaster was the result of different elements played into by other companies and contractors. They, alongside BP, must also be held liable for the disaster and its effects (The Economist, 2010). Transocean and Halliburton cannot hide behind the cloak of subcontractors in order to escape liability for their actions. 2. On the PR blunders of the corporation, the general public, especially the fishermen, and the business owners affected by the oil spill are significantly affected by the blunders because they would likely feel that the company is not taking the issue and their situation seriously (Luce, 2010). Mainly though, the stockholders in the company and the employees of BP would likely be affected by the PR blunders of the corporation. As was observed, during the time when Tony Hayward uttered some insensitive remarks about the oil spill, company shares for BP went down and in about a day, it manifested billions of dollars in losses (Luce, 2010). As the company would continue to blunder its way in the aftermath of the disaster, potential losses would likely be felt by the company shareholders. BP also did not handle the PR issues well. They did not have sufficient control over their Twitter account and their CEO did not have sufficient sensitivity and leadership capability to assure the public of its control and capability in resolving the issue (Luce, 2010). Along with its incompetence in plugging the oil leak and in containing the oil slick, its PR blunders exacerbated the dismal image of BP to the general public. The fact that their CEO even had the time to go sailing on the Isle of Wight while the company was in the very midst of a major disaster further exemplified that BP was NOT taking the issue seriously (Berr, 2010). Worse, photoshopping pictures and releasing them to the public also indicated that BP was more concerned about its image; not so much about doing right by the environment and by the people affected. In defence of BP In defence of BP, especially of Tony Hayward, his insensitive statements like that of “wanting his life back” can be interpreted in terms of wanting to do over some of the decisions they have made during the time leading up to the disaster (Tobak, 2010). But since the media was out to punish and vilify BP for the disaster, his statements were interpreted in the worse possible light. President Obama’s criticism of Tony Hayward also shifted the attention (and consequently, the blame) of the media and the general public to Tony Hayward (Tobak, 2010). What the media and the public did not seem to see in this situation is the fact that Tony Hayward was out in front and was optimistic about the resolution of the issue. The weight of the entire Gulf of Mexico was placed on his shoulders and most people were very much out for his blood. He was a man in the midst of a no-win situation and he handled the situation the best way he could have (Tobak, 2010). With the judgment and the eyes of the world on him, everything he said and did would have been interpreted in the worse possible way because he was the public figure of the company which people could blame and vilify. Conclusion After considering the issues and the discussion on the issue, I believe that in terms of how BP handled the oil disaster, it was an utter failure. It was incompetent in every way. It did not have the means and the capability of preventing and controlling oil leaks. For an oil company, it should have had contingencies for oil spills in place at the earliest possible time. BP did not have the capability of containing such oil leaks. It took many tries and many months for the leak to finally be plugged and by then the damage was already done. And the damage is one which can hardly be resolved in months or even years. As seen in other oil spills, their environmental impact is often apparent even after decades have passed. In terms of how BP handled the PR issues, BP also failed miserably. Controlling the flow of communication and the image of the company in the midst of the disaster should have been considered priorities for the company. In order to achieve this, from the time disaster struck, all statements from the company, including its staff and employees, should have been strictly monitored and controlled. In this case, BP did not censor its communiques; in the process, it made things worse for itself – further plunging the cost of its stocks to new and possibly irretrievable lows. On so many counts, BP handled the oil spill disaster incompetently and with a total lack of capable leadership. It therefore deserves the condemnation of the public and of its shareholders. Works Cited Adam, D. (2010) BP oil spill: death and devastation – and it's just the start, Guardian.uk, viewed 21 January 2011 from http://www.guardian.co.uk/environment/2010/may/31/bp-oil-spill-death-impact Assar, J. (2010) The Long Term Economic Effects of the BP Oil Spill, Suite.com, viewed 21 January 2011 from http://www.suite101.com/content/the-long-term-economic-effects-of-the-bp-oil-spill-a250423 Berr, J. (2010) BP CEO Tony Hayward Isn't Winning 'Hearts and Minds', Daily Finance, viewed 21 January 2011 from http://www.dailyfinance.com/story/bp-ceo-tony-hayward-public-relations-mistakes/19483295/ Hutchison, P. (2010) BP blunders and bad news since giant oil spill, Telegraph.uk, viewed 21 January 2011 from http://www.telegraph.co.uk/earth/energy/oil/7902378/BP-blunders-and-bad-news-since-giant-oil-spill.html Luce, E. (2010) Meet “Tony” BPs New Mascot, The Financial Times, viewed 21 January 2011 from http://albaoilblog.com/?p=212 Nemana, V. (2010) BP: Spilling Oil And Incompetence, NYU Local, viewed 21 January 2011 from http://nyulocal.com/national/2010/09/08/bp-oil-disaster/ The case for the defence (2010) The Economist, viewed 21 January 2011 from http://www.economist.com/node/16996781 The Massive Impact of BP Oil Spill Till Date (2010) Retire Early, viewed 21 January 2011 from http://www.iretireearly.com/the-massive-impact-of-bp-oil-spill-till-date.html Tobak, S. (2010) In Defense of BP CEO Tony Hayward, BNET, viewed 21 January 2011 from http://www.bnet.com/blog/ceo/in-defense-of-bp-ceo-tony-hayward/4780 Read More