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TopAustrianFool (98.82)

May 2010



The Scientifical[sic] Politics of the BP-Transocean Rig Disaster

May 28, 2010 – Comments (0) | RELATED TICKERS: BP , RIG

The BP-Transocean Rig (NYSE: BP, RIG) disaster has been so politicize that BP (NYSE: BP) continues to make public estimates of the amount of oil being spewed into the Gulf of Mexico waters that reside in the low part of range, and environmental scientist and activists continue to predict disaster conditions that reside on the high part of the range. The fact is that there is a lot of uncertainty and without knowing much of the details, and I don’t think anyone really knows the details, as a scientist I can only be skeptical of all of the numbers that are thrown out. This has been so politicized that President Obama came out yesterday to take responsibility for something over which he has no control. BP (NYSE: BP) has the equipment, the expertise, plenty of money and the incentive to stop the leak. There is nothing the federal government can do, except obstruct and I believe that is exactly what the President is likely trying to avoid.                                                                                                                                                                     The BP-Transocean Rig (NYSE: BP, RIG) disaster continues to be compared with the Exxon-Valdez accident in Alaska. Nevertheless, this may be a poor comparison since the location of the spill relative to specific ecosystems seems much different. The location of the rig may actually promote the sinking, dissolution, evaporation, and mixing of the crude with all kinds of organic matter making it less prone to spreading once it reaches the coast. This may be a beneficial effect in terms of damage, and may also be hindered by dispersants which may cause the oil to remain as an oil sheen on the surface that once reaching the coast may spread and affect wildlife more readily. There is likely to be a lot of damage to ecosystems and wild life, nevertheless there is plenty of that with hurricanes, and ecosystems do bounce back. Frankly, this is all speculation on my part, but my point is that it is all speculation from everyone and the uncertainty is being exploited by both sides in order to advance their agendas. This is unfortunate because we need oil. Oil is the cheapest source of energy available to mankind, whether is clean or not depends on the technology used to burn it. Therefore this should be an opportunity to learn and understand how rigs can be made safer, how real are the environmental fears of a disaster and what government policy should be in regards to rig safety. But forget about all that, this situation has been so politicized by both sides that the learning process will never happen. Whatever the damage is in real term, all we will know is those low and high end-of-the-spectrum political estimates that both the politicians, the oil industry and environmentalist (this include the so-called scientific kind) need in order for their gravy train to continue rolling along while the rest of us pay.


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