Before the Deepwater Horizon incident, Tony Hayward, the CEO of BP has made the following statement in the company’s annual report regarding the needs of risk management, “Risk remains a key issue for every business, but at BP it is fundamental to what we do. We operate at the frontiers of the energy industry, in an environment where attitude to risk is key. The countries we work in, the technical and physical challenges we take on and the investments we make – these all demand a sharp focus on how we manage risk.” (BP, 2009) BP has established a safety and risk management operation system called Operating Management System (OMS) to forecast and treat potential operational risks. Despite all the efforts have been made, operational incidents …show more content…
Most of the time, risk assessments are based upon the likelihood of occurrence and the relative impact of risks. As a consequence, high-probability, high-impact risks get the most attention. In the Deepwater Horizon case, BP did not prepare itself to respond to the low-probability, high-impact event properly. Learning from prior incidents, BP should increase the effort to identify not only the risks that are mostly likely to occur but also the ones that are less likely to happen, but may destroy the company in one …show more content…
In the Gulf of Mexico, many species like shorebirds, water fowls, marsh birds, and sea turtles almost became extinct because of the oil spill. BP should work with marine and wild life conservation organizations to restore the eco-system and replenish the population of those marine species. On the one hand, BP could set up a research foundation to seek the solutions for global biodiversity reservation. On the other hand, BP could work with environmental regulators and government to bring up new safety norms, to prevent such severe incidents from happening again in the
The British Petroleum (BP) oil spill in the Gulf of Mexico was one of the worst ecological catastrophes in human history, causing vast damage to a fragile and beautiful ecosystem while at the same time calling attention to the deficits in current approaches to energy prospecting, risk management, and cleanup. This analysis of the Deepwater Horizon explosion and oil spill will devote attention to the following questions: (a) What kind of technology is in use for deep-sea oil extraction, what are the factors that accounted for the BP catastrophe, what were the statistical components of the spill in terms of volume and concentration, and what was the spatio-temporal scale of the oil spill? (b) What were the environmental (physical, biological, hydrological, and atmospheric) impacts of the oil spill, in addition to the economic and social impacts? (c) What were the scientific, technological, and policy solutions implemented by various actors to pursue the cleanup of coastal areas, wildlife, and wetlands damaged by the oil spill? (d) What is the feasibility of long-term biodiversity conservation measures and the limits of such solutions?
At the end I come to conclusion that BP was not properly prepared for any disaster like that there risk assessment related to project is very limited and even not considered seriously about it for their own progress and putting live of public and employees in danger by not following the standard SOP of particular project. Even after incident happened they try to close their eyes on reality. The company should take this incident as alarm and should implement proper risk assessment for future and also compensate damages on ethical ground and if they counter this situation in good way their loss of bad reputation will be lesser as it predicted to be they should considered their responsibility towards society as well by doing this they not only making other people lives better but also earning good will to their company.
In the Macondo blowout case, (Deepwater Horizon Oil Spill), leaders within Transocean and British Petroleum (BP) processed a “by any means necessary” mentality as well. The company cultures promoted doing whatever was possible to enhance profits. This oil leak and explosion, resulted in the loss of 11 lives, destroyed beaches and wetlands, and killed multiple wildlife species. The most telling piece of information throughout this case is that the oil spill and explosion could ...
In 2010, there was a huge oil spill near the Gulf of Mexico that we now know as the BP Oil Spill today. The Spill sent about 170 million barrels of crude oil into the Gulf of Mexico. The spill killed 11 men aboard the deep-water Horizon. The BP Oil Spill impacted the environment very negatively. There were different types of environmental impact as a result of the Oil Spill, but the two that grabbed my attention the most are the Polluted Air and the Contaminated Food Chain. The first impact that grabbed my attention was the Polluted Air. Because of the Oil Spill, the air around the surroundings neighborhoods was polluted. All the lightest chemicals in the oil that had spill evaporated within hours of the incidence forming air pollution particles. These particles that are in the air poses significant threats to the human health from being inhaled. The chemical found in the particles that was formed is known as Volatile, which has been known to cause respiratory irritation and central nervous system depression (Solomon & Janssen, 2010). The second impact that grabbed my attention was the contamination of the food chain, specifically the food chain of sea animals that lives near the Gulf of Mexico. Scientists found traces of oil in zooplanktons; this could only mean that the sea creature has had contact with the spilled oil. According to the Staff at Houston Business Journal (2012), “Baby fish and shrimp feed on the tiny, drifting zooplankton, and then introduce contamination and pollution to the larger sea creatures in the food web.” With these findings, it isn’t going to take long before the baby fishes become grown and caught by fishermen and before we know it, it’s on our dinner plate. And here we are eating fishes w...
This is not the first time that BP is at fault. They have had criminal convictions in places such as Endicott Bay in Alaska, Texas City and Prudhoe Bay. Jeanne Pascal was a part of the Environmental Protection Agency (EPA) and was assigned to watch over BP. Pascal was watching over companies such as BP that were facing debarment. Under her watch, BP was charged with four federal crimes. Over the past twelve years, Pascal’s seen BP patterns as misconducts. She attempted to warn the government about BP’s safety and environmental issues that would most likely lead to another disaster. While she was watching over BP, the company misinformed and misled her about things that resulted to the felonies that they have committed. Sensing that some things were not right about the company, she presented a case of their unsafe working environments.
“On March 23, 2005, at 1:20 pm, the BP Texas City Refinery suffered one of the worst industrial disasters in recent U.S. history. Explosions and fires killed 15 people and injured another 180, alarmed the community, and resulted in financial losses exceeding $1.5 billion.” (U.S. Chemical Safety and Hazard Investigation Board, 2007) There are many small and big decisions and oversights that led to the incident. Underneath all the specific actions or inaction is a blatant disregard for addressing safety violations and procedures that had been pointed out to BP even years before this event. The use of outdated equipment and budget cuts also contributed to the circumstances that allowed this accident to happen.
Tucker, G. (Director) (2014, January 6). Risk Management Powerpoint Week 1 Chapter 1 and 2. Risk Management - EMGT-4215. Lecture conducted from National Labor College, Silver Spring, MD.
In recent years, many organizations particularly in a high risk industry have experienced significant losses. For this reason, they have been more considered the importance of the concept 'High Reliability Organization' (HROs). Weick and Sutcliffe (2001) as cited in Takagi and Nakanishi (2006), claim that a comprehending of the HRO concept can lead to clearly understand a technical system within an organization. This leads to minimize any failures from unexpected circumstances. To be more precise, it can be said that the HRO principle assists the organization to determine the risk factors that may negatively affect a company performance in an early stage of a project life cycle. Similarly, Laporte and Consolini (1991) as cited in Aase and Tjensvoll (n.d.) state that any high risk organizations who has applied the HROs principles tend to have an outstanding safety records.
Rather, it is centered around comprehension the key risks an organization confronts then going for broke at the best time in the wake of utilizing the most suitable safety measures (Valderrey, 2016). Even in the best of times, in the event that you are to oversee risk successfully, you should make to a great degree decision making ability calls including information and measurements, have an unmistakable feeling of how all the moving parts cooperate, and convey that well. In the most noticeably awful of times, risk management can go into disrepair. Recorded models can come up short, liquidity can become scarce, and relationships can get to be more grounded all of a
On April 20, 2010, the Deepwater Horizon oil rig, located in the Gulf of Mexico exploded killing 11 workers and injuring 17. The oil rig sank a day-and-a-half later. The spill was referred to as the Deepwater Horizon oil spill, BP oil spill, Gulf of Mexico oil spill, and BP oil disaster. It was first said that little oil had actually leaked into the ocean but a little over a month later the estimate was 12,000-19,000 barrels of crude oil being leaked per day. Many attempts were made to stop the leak but all failed until they capped the leak on July 15, 2010, and on September 19 the federal government declared the well “effectively dead.” In the three months that it took to finally put a stop the leak, 4.9 million barrels of oil were released into the ocean. The spill caused considerable damage to marine and wildlife habitats and the Gulf’s fishing and tourism industries. The White House energy advisor, Carol Browner, goes as far to say that the Deepwater oil spill is the “worst environmental disaster the US has faced.”
Business risk management has been a widely crucial tool for firms to include in their operations and its importance cannot be overlooked. In the case of British Petroleum (BP) Gulf of Mexico Oil Spill in 2010, there was negligence and lack in the contingency plan and response of the company to the risks that arose. It became evident in this analysis that BP’s manner of handling the incident had a massive financial implication that ensued negative public perception and company reputation and value.
On a Monday afternoon, A couple of friends and I drove about forty-five minutes to El Dorado to see a movie. A movie in which we didn’t know anything about. None of us had even seen the trailer. I sent my friend a link to the movies that were showing at the cinema in El Dorado, and she had chosen Deepwater Horizon solely on the fact she liked the actors that had been cast for the movie. A few of these actors included Mark Wahlberg and Kate Hudson. Deepwater Horizon, as I came to find out on the car ride there, is about the most devastating oil spill in United States history. Since this event occurred only roughly six years ago, I recognized it after my friend called it the BP oil spill. Growing up in south Arkansas, I know many people that work on oil rigs so the spill was something that came close to home. The movie portrays the events leading up to the rig explosion and the aftermath concerning the people aboard the rig.
A candidly of risk occurs in every organisation. Governance principals and the occupational health and safety urge that the organisations take reasonable measures to hinder loss, charge or rage to the organisational and all stakeholders/management. Injury and accidents can even happen ultimately with stringent OHS and the fact that an accident when occurs, does not mean that someone is liable if all responsible steps for prevention or minimisation has been taken.
Operational risks are risks that may occur in the day to day activities, which may involve the process, systems, or people. Strategic risks are those risks involved with strategy. Positioning ones’ company with the right alliances and competing with fare prices will help affect future operational decisions. Compliance risks involve the many legislations and regulations a company must follow. The results could lead to high penalties and a company’s reputation could take a hit. Lastly, financial risks are always being monitored because oil, fuel, and currency rates are constantly fluctuating. By monitoring the fluctuating rates determines fare cost and balancing of the budget. “Like in any other industry, the risk exposure quantifies the amount of loss that might occur from any particular activity” (Genovese,
The BP Deepwater Horizon oil spill accident of April 20th 2010 that caused a gas release followed by the explosion that took place causing hydro carbons to leak into the Gulf of Mexico posed a lot of strategic implications in the competence, capabilities, internal resources and Corporate Social Responsibility of BP. The implications of the Oil Spill underscores the Icarus paradox, which holds that the very capabilities that give an organization its source of competitive advantage can become constraining with changes to the external context. Teece (2009) emphasised that dynamic capabilities revolve around three generic types namely: Sensing (ability to scan, search and explore the external