Most people reading this will know that the Deepwater Horizon drilling rig exploded in the Gulf of Mexico last week, killing 11 people and releasing 6 million litres of oil (so far) from the sea bed. The resulting slick is threatening wildlife, eco-systems and fisheries along hundreds of miles of the US coast.
From a business point of view, the lessons we can learn from this are:
- Environmental Impact Assessments (EIAs) are often not worth the paper they are written on. The Deepwater Horizon EIA suggested that the probability of such an event was minimal and, even if it did, the impact would be minor. While there is a tiny possibility that the first part of that conclusion was valid (because "stuff happens"), the second part is clearly nonsense.
- Oil reserves are running low - things are getting bad when we're having to pursue oil at such inaccessible depths. The peak-oil-is-bunk brigade say that technology will always deliver more oil - tell that to the good people of Mississippi, Alabama, Louisiana and Florida. There are clear signals that it is time for all of us to start weaning ourselves off oil.
- If you are a multi-national, you will get the blame for problems in your supply chain. No matter that this rig was owned and operated by other companies, the US Govt, the media and the public are blaming BP as the sponsor of the operation.
- The old risk perception argument holds up - society will tolerate lots of little accidents, but not one big one. Maybe there are things we just shouldn't do and deep sea drilling is probably be one of them, and of course drilling in the Arctic is another.
- No matter how green your company is (and BP got ranked top non-US company for sustainability efforts in Green to Gold - one of the few false notes in an otherwise excellent book), a major environmental incident will kill your reputation stone dead.
You think we would have learnt from the Exxon Valdez, the Torrey Canyon, the Sea Empress etc, etc...