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To: GPS Info who wrote (96833)	11/30/2012 12:32:28 PM
From: Maurice Winn	5 Recommendations Respond to of 217574

To labour the point, < I think people should not be dismissive of the costs of those pensions, for example, of the massive environmental disasters that occur to get that pension. > That is correct and to me, trite. That's why a third or a century ago I was labouring the point to BP's management and successfully so. At the time, they were focused on avoiding capital expenditure. One of my arguments to BP was that BP was in the business of capital investment rather than the oil business. Capital investment in environmental protection is as good as any other investment if the politicians and public are willing to pay for it. It even gives companies like BP a competitive advantage as other companies are not able to keep up. Exxon is now using that very argument - to the surprise of many. When I quit in 1989, my boss's boss Hans den Ouden, in our last conversation, said that BP was coming around to my way of thinking. I laughed, because any progress seemed so glacial. But in fact, through the 1990s they did continue to change. They even introduced by product BP Ultimate, though I don't know what the specification is so perhaps it's not as good as I wanted. The point of your comment was that people, BP, were dismissive of the cost of obtaining those pensions, aka the massive environmental disaster that occurred to get that pension. Namely, the minor damage from the oil well that went bad in the Gulf of Mexico. Can you name some others that perhaps you are thinking of? It must be that one. As predicted by me within a week of the accident, there was not much environmental damage. Now, there's nothing left to see other than in a few swampy places and nature will very quickly recycle that. Not only were the environmental costs charged back to BP, it turned into a huge financial windfall because of the litigious and highly punitive USA legal and political system, which is what I was warning BP about 25 years ago. The USA won't let BP invest now. That's not good for BP but it's worse for the USA. Do you understand the various points now and the difference between our points? You thought that the cost [price being a bit different from cost] should not be dismissed. Nobody said the cost should be dismissed. I was specifically warning about the price [the word you used] because I knew that the price would be vastly higher than the cost, and so it has turned out to be. Every man and his dog has been in the trough, getting big heaps of loot from the BP shareholders. There was some environmental and economic damage, but it was nowhere near the tens of $billions which was the price charged by the legal and political system. The accident has been enormously profitable for the USA. They should let BP in again and hope for another accident to make even more money. BP might be more circumspect about investing in the USA now, even if they were allowed. The big losers were the men and their families who died in the accident. But I guess that even the families might have been quite well compensated. I remember at one time explaining to my wife that I was more valuable to her dead than alive because of the insurance BP had on my head. She could get a big pension payout in the event of my demise. I jokingly made some comment about me needing to ensure I did not meet with an "unlucky" accident. Who do you think might have been dismissive of "the price" or just the costs of the environmental damage? I can't think of anyone other than the politicians and public who want cheaper fuel. If you put two pumps side by side on a forecourt, with one being cheaper because the environmental externalities are not charged, but the other has everything priced in, sales of the cheap one will be very high. More women than men would buy the more expensive one. If you want an oil industry environmental cost which was treated dismissively, lead in petrol is the place to look. I note you were dismissive of the point I made about it. Totally ignoring it, dismissiing it out of hand. BP was not dismissive of that cost [when I got into lead in petrol]. The public and politicians were dismissive of it. Getting lead banned was very hard work. People just want cheap petrol. Especially men. Politicians can't understand much and were dismissive of the cost. BP;s share price never suffered the catastrophe that could have been a class action suit against the companies and individuals responsible for poisoning everyone with lead. What do you think was the environmental cost of lead in petrol? You seem to think the Gulf of Mexico accident was big. It was minor, though the price to BP shareholders was very large. The cost of brain damage due to lead was vast. You and nearly everyone are dismissive of such costs. That is fortunate for BP shareholders and those of other lead producers and sellers. A friend who did exploration and production said one of the hard things is to get people to hit the off button when things go wrong. They know they are shutting off $billions in platform and livelihoods and apparently getting them to quickly do it is difficult. So the accidents don't necessarily happen because of malfeasance or dismissiveness. It's a problem of making sure people know what to do and when. Most people faced with catastrophe [such as fiscal cliffs] have trouble accepting the reality and gravity of the situation. They first deny the reality of the problem - looking for a simpler and cheaper cause. It is already by then too late. Hiring humans is notoriously problematic in that regard. You might even have observed yourself be less than perfect some time, so place. Mqurice