Thursday, May 20, 2010

Manufacturing Uncertainty in the Gulf

According to this morning’s New York Times, British Petroleum, with apparent cooperation from the US government, is making an all-out effort to obstruct measurement of the ongoing Deepwater Horizon oil blowout. University researchers have been prevented from approaching the scene, and whatever data are being collected are being withheld from the public. A possible scenario is that numbers will be released only after the flow has stopped, that they will not be viewed as credible, but it will be too late to correct them.

This is a very big deal for BP and their contractors. They are looking at vast potential liability for damages from Florida to Texas, not to mention the Caribbean islands, who are truly innocent potential victims. At some point there will be lawsuits, testimony, juries, and awards. Down the road it will be of great value to have uncertainty over the amount of oil involved in the disaster. If I’m a BP lawyer, I want to say “Maybe this damage was caused by us, but maybe not, because we just don’t know the exact extent of the spill. We will be happy to accept responsibility for damages that can be proved, but we don’t think we should be made to pay just on someone’s speculation.”

BP’s legal team is no doubt emphasizing that effective defense against liability began on day one of the blowout and continues until the end of the process. It would be interesting to know what motives impel cooperation on the government’s side.

I hope the political focus is sharpened: we need the most accurate possible measurements of how much petroleum is entering the gulf and how and where it is being transported, starting right now.

UPDATE: My crude economic speculation is corroborated by actual investigation. And someone should tell the good people at NRDC that squeezing BP dry in court is not a secondary matter to the current cleanup; it is society's first line of defense against future eco-malfeasance.


BadTux said...

One thing to bear in mind is that The U.S. Government Inc. (A Wholly-owned Subsidiary of BP) also has an incentive to downplay the size of the spill, since this was a FEDERAL lease and it is the federal government that's going to get sued too when the legal dominoes start coming into play. Minimizing the payouts thus is not only a motivation for BP to obstruct attempts to measure, but also an incentive for the USG itself to obstruct attempts to measure.

Which is crazy... the USG is supposed to be We The People, not a wholly-owned subsidiary of a foreign oil company. But that's how it seems to be going...

pandoy said...

the gulf? and how and where it is being transported. so interesting.

jsalvati said...

"squeezing BP dry in court is not a secondary matter to the current cleanup; it is society's first line of defense against future eco-malfeasance." As someone who frequently disagrees with you: I could not agree more!