Thanks to BP the Gulf of Mexico may be a complete environmental disaster but at least all that oil isn’t going to waste.
According to the Associated Press, BP’s latest containment cap strategy, which has been considered a relative success (relative to doing nothing, apparently), was collecting about 11,000 barrels of oil per day until Sunday. BP plans to ad another recovery vehicle to the effort, effectively increasing the recovery capacity to roughly 20,000 barrels per day. That’s not close to all of the oil leaking from the breached drilling site but it is a fair amount.
In another story, BP estimates it may be August before a permanent containment solution is in place. Now that’s a real bummer for every living thing in the Gulf of Mexico, as well as along the Louisiana and Florida coastlines, but it’s not so bad for BP. If we consider that 20,000 barrels of oil per day is currently being collected from the site, and we can expect this to continue until, at best, August 1st, then we can determine that somewhere in the neighborhood of 1.2 million barrels of oil will have been collected over a two-month period.
If we take that one step further and multiply that by the current price of oil, which is currently hovering around US$71 per barrel, we can determine that BP stands to recover about US$85.2 million worth of oil.
I consider this a conservative estimation, since it assumes that the Gulf of Mexico site will be completely contained by August 1st, which it most certainly will not be. Also, I haven’t factored the usual skyrocketing prices of oil in high summer.
Regardless, I’m just so pleased to know that despite the overwhelming environmental devastation caused by poor planning at BP and seemingly non-existent regulation by the US government, at least it’s not a complete financial loss. Entire species of birds and sea creatures will be wiped out, but the wheels of capitalism will continue to turn.
It makes one wonder why BP would really want to stop the flow of oil from the Gulf of Mexico site, since that would represent a complete loss on the initial investment. Perhaps it does explain BP’s early attempt to drop a giant box on the site to stem the leak, a strategy almost certain to result in complete failure, but also certain to buy time while the company devised a way to recover losses.
.
According to the Associated Press, BP’s latest containment cap strategy, which has been considered a relative success (relative to doing nothing, apparently), was collecting about 11,000 barrels of oil per day until Sunday. BP plans to ad another recovery vehicle to the effort, effectively increasing the recovery capacity to roughly 20,000 barrels per day. That’s not close to all of the oil leaking from the breached drilling site but it is a fair amount.
In another story, BP estimates it may be August before a permanent containment solution is in place. Now that’s a real bummer for every living thing in the Gulf of Mexico, as well as along the Louisiana and Florida coastlines, but it’s not so bad for BP. If we consider that 20,000 barrels of oil per day is currently being collected from the site, and we can expect this to continue until, at best, August 1st, then we can determine that somewhere in the neighborhood of 1.2 million barrels of oil will have been collected over a two-month period.
If we take that one step further and multiply that by the current price of oil, which is currently hovering around US$71 per barrel, we can determine that BP stands to recover about US$85.2 million worth of oil.
I consider this a conservative estimation, since it assumes that the Gulf of Mexico site will be completely contained by August 1st, which it most certainly will not be. Also, I haven’t factored the usual skyrocketing prices of oil in high summer.
Regardless, I’m just so pleased to know that despite the overwhelming environmental devastation caused by poor planning at BP and seemingly non-existent regulation by the US government, at least it’s not a complete financial loss. Entire species of birds and sea creatures will be wiped out, but the wheels of capitalism will continue to turn.
It makes one wonder why BP would really want to stop the flow of oil from the Gulf of Mexico site, since that would represent a complete loss on the initial investment. Perhaps it does explain BP’s early attempt to drop a giant box on the site to stem the leak, a strategy almost certain to result in complete failure, but also certain to buy time while the company devised a way to recover losses.
.
1 comment:
i hadn't really thought about how BP would (or could) gain financially from this spill.
clearly it's good business to destroy the ocean and all the life in it.
all of the money they make selling oil from now on should go to a fund for cleaning up that shit.
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