BP and Transocean: Hey, What Gulf Oil Spill? We're Doing Great!
In case you hadn't heard, BP and Transocean are totally winning it this month. We're only four days into April and already Transocean has broken safety performance records while BP execs are pushing to restart drilling in the Gulf of Mexico. Who knows what other winning strategies the two companies will unveil before April 20, the one-year anniversary of the Deepwater Horizon disaster in the Gulf of Mexico.
The top "winning moment" (so far) goes to Transocean
Transocean (RIG), the owner of the oil rig that killed 11 workers when it exploded in the Gulf last year, declared in a securities filling that 2010 was its "best year in safety performance" ever. As a reward for this outstanding result, executives received two-thirds of their target safety bonus. OK, who slipped the board of directors Charlie Sheen's tiger blood?
At least Transocean opened its celebratory remarks with this disclaimer: "Notwithstanding the tragic loss of life in the Gulf of Mexico, we achieved an exemplary statistical safety record." Thanks, guys -- that does clarify things.
The WSJ, which originally reported the story, explains that based on the way the company measures safety, 2010 was technically safer than previous ones.
Transocean uses two safety criteria to calculate executive bonuses: the rate of incidents per 200,000 hours that employee works, and the potential severity of those incidents. In 2010, the rate of incidents dropped by 4% from 2009. A number that measures potential severity of those incidents fell nearly 15% from last year.It's not clear which is more disconcerting: That the best safety performance in the Transocean's history comes in a year when 11 workers died in a fiery explosion, or that the company completely ignored its role in the worst offshore disaster in U.S. oil industry history and decided it was perfectly reasonable to issue any bonuses tied to safety.
The winning runner-up for April is... BP
BP has asked the federal government for permission to resume drilling in the Gulf of Mexico this summer.
Of course BP wants to restart its drilling operations in the Gulf. For one, BP is deeply vested in the region, where it has 20 oilfields. And to BP, the request must seem reasonable enough. It's only asking to restart development wells, which are aimed maintaining production at existing fields. The company wants to drill 10 development wells that were already underway when President Obama issued a moratorium on deepwater exploration drilling.
Plus, the Bureau of Ocean Energy, Management, Regulation and Enforcement has approved permits for eight deepwater wells since mid-February. So, if everyone else gets to drill, why not BP?
For one thing, of course, none of BP's rivals -- here, Eni, Chevron (CVX) and Exxon (XOM) -- have spewed 4.9 million barrels of oil in the Gulf of Mexico in the past year. Not to mention, that BP has yet to prove that its culture has changed and it can safely operate offshore.
Eventually, the government will give the BP the OK. But the company's management team is delusional if they think the feds will give them the thumbs up less than three weeks from the one-year anniversary of the Gulf oil spill.
The more likely scenario is that the BOEMRE first will review and approve permits for any and all companies that had their operations suspended by the moratorium -- except BP. Only after they've dealt with the other oil companies will they take a hard look at BP.
Photo from Flickr user Deepwater Horizon Response
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