British Petroleum (BP) bankruptcy?

Discussion in 'Off Topic Discussion' started by realitybites.in, Jun 10, 2010.

  1. realitybites.in

    realitybites.in
    uix_expand uix_collapse
    Member

    Joined:
    Apr 23, 2009
    Messages:
    368
    Likes Received:
    0
    BP Buys Search Term "Oil Spill" From Google

    BP Plc has bought terms such as "oil spill" from search engine providers including Google Inc to help direct Internet users to its website as it attempts to control the worst oil spill in U.S. history. A spokesman said BP would pay fees so its own website would rank higher or even top in the list of results when Internet users search on terms such as "oil spill", "volunteer" and "claims". BP did not say how much it was paying for the service but President Barack Obama has criticised the company for spending $50 million on TV advertising to bolster its image during the crisis.

    http://tech2.in.com/india/news/webs...0?utm_source=dailynewsletter&utm_medium=email
     
  2. Fergal

    Fergal
    uix_expand uix_collapse
    Premium Member
    Premium Member

    Joined:
    Nov 18, 2007
    Messages:
    10,578
    Likes Received:
    1,163
    It's normal for big companies to try to minimise the PR impact of a major crisis. It makes good business sense and it is not surprising that they would buy search terms to aid them with this. When I do a search for "oil spill" in Google, I don't see BP in the sponsored listings. Perhaps they are not doing it in the Irish market.
     
  3. Scottypops

    Scottypops
    uix_expand uix_collapse
    Member

    Joined:
    Jun 12, 2010
    Messages:
    70
    Likes Received:
    0
    British Petroleum is an international oil and gas company. BP stock was consistently trading above $60 per share until the oil spill in the gulf of Mexico occurred on April 20, 2010. BP shares sank to their lowest levels in 13 years as U.S. lawmakers pressed the British oil company to halt its dividend payments and fork out more compensation for damage caused by the massive Gulf of Mexico oil spill. 52 days later, BP is lost $90 billion in market share and has yet to contain the catastrophic spill. The cost of the cleanup and containment efforts has now hit $1.43 billion. Let me remind you that a) the leak hasn’t been stopped, b) they are facing lawsuits, and c) BP has to clean up the mess after the well is sealed.

    Click here to read the rest of the article and the commentary that follows.
     
  4. Kay

    Kay
    uix_expand uix_collapse
    Member

    Joined:
    Sep 29, 2008
    Messages:
    1,816
    Likes Received:
    21
    BP has 1055 institutional stockholders. Just take a look at the major one to see how much they have invested in BP. They won't go into bankruptcy--if ever-- until those institutional holdings have the opportunity to recoup the losses. Right now all they can do is sit tight until the shares recover. Because until they physically sell them, they haven't made a loss apart from on paper.

    The minute it looks like BP is on the road to recovery and this mess is being resolved, buyers will swoop in to get the shares at these prices. They are waiting in the wings to make a killing when BP shares start climbing again back to where they were and beyond. I don't think bankruptcy's going to happen. Too many institutions and fund holders are involved here.
     
  5. seanstevens

    seanstevens
    uix_expand uix_collapse
    Member

    Joined:
    Jul 27, 2009
    Messages:
    638
    Likes Received:
    2
    BP (They dropped the name British Petroleum years ago and their ownership is 40% American) will survive. They have and will have a lot of value slashed from their share price. The final outcome will depend on how far thinks he can go with pushing the BP against the US card.

    The interesting thing has been that whilst BP has been nailed to the cross, Transocean, the US company involved has escaped almost untouched and actually their shares were up a few days ago.
     
  6. Fergal

    Fergal
    uix_expand uix_collapse
    Premium Member
    Premium Member

    Joined:
    Nov 18, 2007
    Messages:
    10,578
    Likes Received:
    1,163
    I agree with the view that BP will survive this. Some of their top executives will probably lose their jobs, but the company will survive this. Their shares may actually represent good value at the minute, because the fall in share price and hence market capitalisation has been much greater than the cost of the accident and clean up operation.
     
  7. VJDMorrey

    VJDMorrey
    uix_expand uix_collapse
    New Member

    Joined:
    Mar 25, 2010
    Messages:
    17
    Likes Received:
    0
    Have you seen the Market Cap for BP?

    Even with the recent price falls its Market Cap is still £67 Billion..

    Even a disaster such as this one won't cause them serious pressure. Unless something esle happens that we don't know about yet.

    VM
     
  8. VJDMorrey

    VJDMorrey
    uix_expand uix_collapse
    New Member

    Joined:
    Mar 25, 2010
    Messages:
    17
    Likes Received:
    0
    BP/ Google

    I just wish I owned the URL's Oilspill.com or similar !! :)

    I would be rich!!

    VM
     
  9. Fergal

    Fergal
    uix_expand uix_collapse
    Premium Member
    Premium Member

    Joined:
    Nov 18, 2007
    Messages:
    10,578
    Likes Received:
    1,163
    You and me both :) The existing owner of that domain isn't exactly maximising its revenue potential, the site on it looks very poor. Even putting a few Adsense ads on it, could be very profitable. Oil spill is currently the second highest term in Google Trends.
     
  10. Scottypops

    Scottypops
    uix_expand uix_collapse
    Member

    Joined:
    Jun 12, 2010
    Messages:
    70
    Likes Received:
    0
    They've already lost $90 billion in stock market share. They've spent roughly $1.5 billion on attempts of ending the oil spill and fixing the leak. Florida and Alabama are suing BP billions, seeking compensation due to less tourism. The fisherman are demanding compensations and President Obama is ordering BP to pay out compensations to the fisherman. They have to continue to pay till the oil is capped. Then the clean-up efforts have to be paid for. The clean-up efforts will bring BP into bankruptcy IMO. BP is also facing boycotts and lawsuits from families whose husbands lives were lost in the explosion and lawsuits from environmental groups.

    With that being said, BP made roughly $30 billion in profits in 2009. Do the math and it's not looking good at all.
     
  11. Fergal

    Fergal
    uix_expand uix_collapse
    Premium Member
    Premium Member

    Joined:
    Nov 18, 2007
    Messages:
    10,578
    Likes Received:
    1,163
    Those figures are quite worrying Scottypops and it will be interesting to see how this works out. Obama is meeting the BP Chairman today and is expected to demand that they put millions into an Escrow account, to provide cover for the clean up. It's good to see a political leader who does not appear to be afraid to stand up to big business.
     
  12. seanstevens

    seanstevens
    uix_expand uix_collapse
    Member

    Joined:
    Jul 27, 2009
    Messages:
    638
    Likes Received:
    2
    Their net income in 2009 was $16.5bn according to their financial statements.

    Sales in the first 3 months of the year (prior to the accident) were $73bn which was 54% higher than the first 3 months of 2009 and on that they made a net income of $6bn.

    As strange as it may sound, the grilling of the other oil chiefs has probably done BP a huge favor. The fact that none of them really came out of it in a great way in safety measures etc. shows that it is an industry wide issue that needs sorting and not company specific.
     
  13. Kay

    Kay
    uix_expand uix_collapse
    Member

    Joined:
    Sep 29, 2008
    Messages:
    1,816
    Likes Received:
    21
    And let's not forget the families who lost their loved ones in amongst this. If anyone deserves money from that escrow account, it's them. They should be at the top of the list before anything.

    BP's tentatively agreed to a $20 billion fund for the cleanup. President Obama's making a live speech about the meeting now. It's being streamed live on the CNN website. The $20 billion is not a cap on liability.


    ETA Breaking news: Chairman Carl-Henric Svanberg says the board of BP has decided not to pay any further dividends this year.
     
    #13 Kay, Jun 16, 2010
    Last edited: Jun 16, 2010
  14. Kay

    Kay
    uix_expand uix_collapse
    Member

    Joined:
    Sep 29, 2008
    Messages:
    1,816
    Likes Received:
    21
    That could well be the reason, Fergal. The sponsored link is right at the top of mine.

    [​IMG]

    Here's the page that link goes to.
     
    #14 Kay, Jun 16, 2010
    Last edited: Jun 16, 2010
  15. Fergal

    Fergal
    uix_expand uix_collapse
    Premium Member
    Premium Member

    Joined:
    Nov 18, 2007
    Messages:
    10,578
    Likes Received:
    1,163
    Thanks Kay.

    BP have announced that they will allocate $20 Billion to a fund for the clean up operation, after their meeting with President Obama. Well done Obama, for not being afraid to get tough with a major corporation.

    Similar threads merged!
     
  16. suzib

    suzib
    uix_expand uix_collapse
    New Member

    Joined:
    Jun 17, 2010
    Messages:
    8
    Likes Received:
    0
    It makes me wonder how much of the criticism is derived from people with a vested interest in driving down the price of BP shares so they can make a killing when they (inevitably) rebound. Maybe I am too cynical but there is a lot of money being made by others as the clean-up goes on. Yes it was a bad accident, yes BP should be made to pay but someone made th epoint earlier.....what about Transocean...?????
     
  17. Fergal

    Fergal
    uix_expand uix_collapse
    Premium Member
    Premium Member

    Joined:
    Nov 18, 2007
    Messages:
    10,578
    Likes Received:
    1,163
    Perhaps they are getting off lightly because they are an American company???
     
  18. Kay

    Kay
    uix_expand uix_collapse
    Member

    Joined:
    Sep 29, 2008
    Messages:
    1,816
    Likes Received:
    21
    I don't think so. And I'm dismayed to see tensions building between British and Americans because of this event. Where a company is located has no bearing on this. What's needed is to get to the root of it, stop the oil gushing out and the shoreline being poisoned. You can be sure that anyone with even a sniff of involvement in this will be punished.

    It will all come out in the investigation who did what and Transocean will pay the price as much as BP will in the end for any transgressions. It's BP that reaps the benefits from the well. They have the ultimate responsibility of ownership and imho that includes ensuring that any subcontracted work done by third parties adheres to safety and drilling standards. That's how I look at it anyway.

    Make no mistake, Transocean isn't getting away with anything or being forgotten about. Their President and CEO was in front of the US Senate just yesterday. He was giving testimony before The Subcommittee on Federal Financial Management, Government Information, Federal Services, and International Security of The Committee on Homeland Security and Governmental Affairs about the response efforts to the oil spill. You can read it all here (PDF). Links to previous testimony are given on their website.

    http://www.deepwater.com/fw/main/Speeches-and-Remarks-950.html

    Transocean also is publicly traded and has shareholders, same as BP does. They trade on the NYSE under the symbol RIG. Their 52 week high (the highest point they've traded at in the last year) is $94.88 and today they are at $49.02, so effectively their share value has halved from its peak in the last 52 weeks. BP's shareholders aren't the only ones feeling the effects of this.
     
    #18 Kay, Jun 17, 2010
    Last edited: Jun 17, 2010
  19. seanstevens

    seanstevens
    uix_expand uix_collapse
    Member

    Joined:
    Jul 27, 2009
    Messages:
    638
    Likes Received:
    2
    Part of this is down to Obama who at the start kept talking about "British" Petroleum. This gave the impression of making the accident a US vs everyone incident. Having spoken to a lot og UK based business people in the past few weeks it is clear Obama and the US has gone down a notch or two in many peoples opinions.
     

Share This Page