I’m a firm believer in 2nd chances. Everyone makes mistakes. And depending on the seriousness of said mistake, one act shouldn’t necessarily define the character of a person or a corporation. But what if a person or company keeps making the same mistake, over and over and over again? Some say that a definition of insanity is doing the same thing over and over again and expecting different results. If that’s true, than it’s time to introduce BP to a straight jacket and a padded cell.
Today we filed comments in an enforcement proceeding at the Federal Energy Regulatory Commission where 4 different BP subsidiaries are accused of manipulating the Houston Ship Channel-Katy Hub natural gas price spread over several months in late 2008. FERC has proposed a $28 million fine, plus disgorgement of $800,000 in unjust profits.
Here’s the problem: at the time of the natural gas price manipulation alleged here, BP was under at least two different special monitoring programs as a punishment for other market manipulation.
On October 25, 2007—less than one year before the violations outlined in the August 5, 2013 Show Cause order detail—BP had to pay a $7 million civil fine, and agree to a “compliance monitoring plan,” which, among other duties, required BP to report to FERC Enforcement Staff “a detailed update of all compliance training administered and compliance measures instituted.” This was required to settle allegations that BP engaged in “thousands” of anti-competitive practices by its natural gas units.
Also in October 2007, the US Department of Justice required BP to pay $303 million to settle allegations that the company manipulated propane markets. In addition, Justice forced BP to hire an outside “compliance monitor” to ensure that the company’s energy trading divisions were behaving themselves.
BP has demonstrated a consistent pattern of market manipulation. Past remedies ordered by the US Department of Justice have included third-party compliance monitors—to no avail. It is clear that FERC must consider suspending or revocation of BP’s blanket natural gas marketing certificates. It’s time to stop the insanity.
Tyson Slocum is Director of Public Citizen’s Energy Program. Follow him on Twitter @tysonslocum
Robert Weissman is president of Public Citizen.
The BP disaster taught us many things: Giant corporations cannot be trusted to behave responsibly, and have the ability to inflict massive damage on people and the environment. We need strong regulatory controls to curb corporate wrongdoing. We need tough penalties to punish corporate wrongdoers. There is no way to do deepwater oil drilling safely. And it is vital that citizens harmed by corporate wrongdoers maintain the right to sue to recover their losses.
Unfortunately, Congress and the Obama administration have refused to learn the lessons from the BP disaster:
1. BP’s reckless actions and inactions caused the Deepwater Horizon disaster — a reminder that corporations cannot be trusted to police their own activities.
BP made a conscious decision not to install a $500,000 safety device that could have prevented the blowout. BP pressured its contractors to skirt safety measures, and those contractors made multiple mistakes leading up to the disaster.
The lesson that corporations can’t be trusted to police themselves should be blindingly obvious. Yet the Obama administration is now proposing to take government inspectors out of poultry processing plants — and give Big Chicken responsibility for ensuring poultry safety.
2. Strong regulatory controls over corporate activity are necessary to ensure health, safety and planetary well-being.
To its credit, the Obama administration acknowledged that the pre-BP disaster oil drilling regulator — the Minerals Management Service, probably the most compromised regulatory agency in Washington — couldn’t be reformed, specifically because it had the duty both to collect oil royalties and regulate oil drilling. It split the agency apart, creating the new Bureau of Ocean Energy Management, Regulation and Enforcement (BOE) to regulate drilling. But Congress has failed to ratify the change in law, which means it could easily be undone by subsequent administrations.
You just can’t make this stuff up.
The government announced today that it is going to let BP do exploratory deepwater drilling in the Gulf of Mexico. Yes, BP — the oil giant that in April 2010 was at the helm of the worst environmental catastrophe in our history. That BP. It was awarded $27 million of leases by the Interior Department.
This happened on the same day that the National Academy of Engineering and National Research Council said in a report that more needs to be done to prevent another Gulf drilling catastrophe. I am not making this up.
The National Journal story about this development quoted Michael Bromwich, the former head of the main offshore energy regulator, as saying in October that the BP disaster was just “one incident” that did not justify “the administrative death penalty.”
As Tyson Slocum, director of Public Citizen’s Energy Program, said in a statement released today, calling the BP disaster an “incident” is like calling Katrina a little rainstorm.
Yes, the federal agency charged with overseeing offshore oil drilling got an overhaul after the BP spill, but Congress never acted on the package of measures developed after the disaster to boost environmental and worker safety in the Gulf. Those were critical to helping stave off further oil gushers. God forbid lawmakers should anger the big oil giants.
Read Slocum’s full statement here.
In the midst of the current economic crisis, one group isn’t struggling so much: corporations. They’ve had sky-high profits, have opted out of paying taxes and have all the governmental support they need. Must be nice, huh?
So, last night the folks over at The Daily Show wondered, well, if corporations can be considered people — as the U.S. Supreme Court and presidential candidate Mitt Romney have alleged — could people use the same money-grubbing tactics corporations use to rebound from their financial plight? Let’s explore.
First, The Daily Show crew needed an expert. But who? Aha! That’s where we come in. Daily Show correspondent Samantha Bee called in Public Citizen president Robert Weissman to guide a struggling family through the same processes corporations go through to save cash.
Poor BP. The multibillion-dollar oil company that has continued to pollute our waters and ignore the safety of its workers just can’t win.
This morning, BP reported its disappointing profits for the second quarter: only $5.6 billion. Boo hoo.
Oh, wait. As Think Progress points out:
Despite making $11 billion in profits in just 2011 alone, BP and its other Big Oil allies continue to aggressively lobby Congress to maintain their billions of dollars in oil industry tax breaks. A quick look at some other key facts:
- BP has already spent $2 million lobbying Congress this year.
- BP has made more than $40,000 in political contributions in just 2011, with 93 percent going to Republicans.
- The Big Five oil companies — BP, Exxon, Chevron, ConocoPhillips and Shell — made more than $900 billion in profits (figure in 2011 dollars) – almost a trillion dollars – over the previous decade.
Then take into consideration that of the $20 billion BP allotted for its escrow fund to repay the victims of its devastating oil spill last summer, the company has doled out only $4 billion. And if that weren’t bad enough, BP wants to stop paying the Gulf’s victims because “the tourism industry is booming, all federal fishing grounds have reopened, and the shrimp catch has been plentiful.”
I really wonder who’s looking after the company’s PR because this is outrageous.