Several financial institutions responded positively to the BP (NYSE:BP) report, not necessarily to its content, but to its purpose, and JP Morgan (NYSE:JPM), along with others, believe BP made a solid move toward defining the narrative.
Morgan said, “In a stock market that has been critically short accurate information on a highly technical event, today’s report is another important step forward (along with capping the well on 15 July). We believe Chapter 1 of this event was trying to quantify the total gross liabilities. In our view, Chapter 2 is about understanding cause and apportioning responsibilities. We will then reach Chapter 3 – settlements.”
Chapter 2, as defined by JP Morgan, is where BP is at now, and if they're successful, they will have moved billions of dollars in responsibility from themselves and spread it to partners and contractors who were part of the operations leading to the failed oil rig.
The major hurdle is positioning themselves as strongly as they can to avoid being designated as being grossly negligent in the accident. The report was directly aiming at that, as well as the secondary issue of pointing the finger at others without seeming to accuse them of anything; they used the technical evidence and reports on other failures to do the job.
Halliburton (NYSE:HAL) and Transocean (NYSE:RIG) went on the offensive almost immediately, as they were specifically singled out as failing at their jobs in specific points leading to the explosion.
Showing posts with label BP Report. Show all posts
Showing posts with label BP Report. Show all posts
Thursday, September 9, 2010
BP (NYSE:BP) Report Clearly About Avoiding "Gross Negligence"
There is no doubt the biggest concern of BP (NYSE:BP) is to be found "grossly negligent" concerning the oil spill in the Gulf of Mexico, which would add billions in fines to the company, on top of the billions already paid out, and the billions committed to in the future.
With that in mind, their report on the causes of the Deepwater Horizon accident definitely was a marketing piece, although it did deal with legitimate issues.
Any report will go through similar possibilities that BP went through, creating probabilities concerning other companies who had worked on, provided equipment for, or had a stake in the well.
The report really points to those possibilities, and in some cases, points directly to specific companies and their alleged failures.
BP did what it meant to in the report, which was to give believable testimony as to real causes, while at the same time spreading the fault around to others having a part in the oil rig and well.
Now the onus will be on future reports to refute BP's assertions, which is made harder by the majority of failures being directed to others.
It's made harder because every assertion by BP will now have to be proven false if it is to point back to them.
This is really their last shot. This report, and future investigative reports from others, will determine how BP is designated in the incident, and how liable other parties are.
It'll be difficult to place all the blame on BP from an evidence standpoint, now that they've pointed out these series of failures which led to the destruction of the oil well, loss of life, and spewing of oil into the Gulf of Mexico.
In a sense, this report rests their case, and now it's in the court of the rest of the participants and investigators to disprove what their findings were.
If BP can avoid being found in "gross negligence," they'll save billions, if others are found at fault, it'll spread the costs among them as well, saving even more billions. BP had nothing to lose, and this is one thing they did right, whether people like it or not.
With that in mind, their report on the causes of the Deepwater Horizon accident definitely was a marketing piece, although it did deal with legitimate issues.
Any report will go through similar possibilities that BP went through, creating probabilities concerning other companies who had worked on, provided equipment for, or had a stake in the well.
The report really points to those possibilities, and in some cases, points directly to specific companies and their alleged failures.
BP did what it meant to in the report, which was to give believable testimony as to real causes, while at the same time spreading the fault around to others having a part in the oil rig and well.
Now the onus will be on future reports to refute BP's assertions, which is made harder by the majority of failures being directed to others.
It's made harder because every assertion by BP will now have to be proven false if it is to point back to them.
This is really their last shot. This report, and future investigative reports from others, will determine how BP is designated in the incident, and how liable other parties are.
It'll be difficult to place all the blame on BP from an evidence standpoint, now that they've pointed out these series of failures which led to the destruction of the oil well, loss of life, and spewing of oil into the Gulf of Mexico.
In a sense, this report rests their case, and now it's in the court of the rest of the participants and investigators to disprove what their findings were.
If BP can avoid being found in "gross negligence," they'll save billions, if others are found at fault, it'll spread the costs among them as well, saving even more billions. BP had nothing to lose, and this is one thing they did right, whether people like it or not.
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