Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Snowshoe who wrote (54625)	10/21/2004 1:02:18 PM
From: Tommaso	Read Replies (1) \| Respond to of 74559

>>>Would this have been because BP needed the capital? <<< I think that's the reason. It's something about their realizing the value of the oil all at once instead of over the life of the field, by selling tax-advatanged shares in the production. You wonder if, with oil at $55 a barrel, they may deeply regret not owning the oil.

To: Snowshoe who wrote (54625)	10/22/2004 4:55:46 AM
From: EL KABONG!!!	Read Replies (1) \| Respond to of 74559

Hi Snowshoe, do you have any idea why the BPT trust was set up in the first place? Would this have been because BP needed the capital? Or needed to spread it's risk? Or wanted a mechanism for compensating it's employees? Almost always, the answer is to alleviate risk. Acquiring additional capital and/or maximizing profits are secondary considerations. Most companies are quite risk averse, and are therefore very willing to share any potential proceeds in exchange for lessening their exposure to any potential risks over time, and "over time" is the key phrase to remember. Various trusts are merely the legal vehicles used to effectively transfer risk. VI