...Offshore Drilling – To Drill or Not to Drill The Effects of Drilling on the Environment and Business Lydia M. Wityk Strayer University Abstract This paper will explore the business of oil companies drilling off the coast line of the United States. It will explore the benefits from the business of oil companies to the detrimental effects of the oil spills from the offshore drilling. Should we continue to drill for oil off the coast with the possibility of additional spillage into the oceans. We know that oil spills damage the environment, and the social and economic welfare of the residents in the area. At the same time the oil companies can positively affect the economy and the United State’s welfare. In comparing both sides of the argument I will look at the past and current oil companies to determine if they acted morally in their everyday business practice. At this post-BP disaster era, the United States is questioning whether we should continue to drill and expand our drilling. I will utilize the consequentialist theory to determine what would be the best next step for the U.S. to take. Using the current information gathered on BP’s business practice and the effects of the oil spill, I will weigh the ratio of good to bad to determine my opinion on whether to drill or not to drill. Off Shore Drilling – To Drill or Not to Drill The Effects of Drilling on the Environment and Business The United States has been offshore drilling for oil since...
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...Off Shore Drilling Jessica Couture HUM/111 CRITICAL AND CREATIVE THINKING 1/29/2012 Tracie Comer Off shore drilling Our country has been getting foreign oil from other countries for as long as I can remember. The U.S relies so much upon Canada, Saudi Arabia, Nigeria, Venezuela and Mexico for our sources of Net Crude Oil and Petroleum Product Imports. My personal belief is that we should not continue off shore drilling. I think it’s time the U.S doesn’t rely on other countries for our oil. Off shore drilling is a bad idea because it’s the worst impacts of global warming; we need to switch from fossil fuels to renewable energy within the next 10 years. The billions of dollars that would be spent on offshore oil drilling just postpone the inevitable transition from fossil fuels to renewable energy. Renewable energy is available now, so it’s time to walk away from fossil fuels and toward a clean energy future. We burn 25% of the world's oil here in the U.S., but we have only 3% of the world's oil reserves. So even if all offshore oil magically came to market today, the vast majority of our oil would continue to be imported, and we wouldn't see price relief at the pump. The reason why I think the way I do about the situation is because offshore drilling poses serious threats to wildlife and natural habitats. I have always been an animal lover and I adore the ocean sea life. For example in the Gulf of Mexico, an explosion on an oil rig operated by the petroleum company...
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...The Bremen et al. v. Zapata Off-Shore Company Supreme Court of the United States 407 U.S. 1; 92 S. Ct. 1907; 32 L. Ed. 2d 513; 1972 U.S. LEXIS 114 Date of argument: March 21, 1972 Date of decision: June 12, 1972 Story: A German company, Unterweser (petitioner) entered into an agreement with an American company, Zapata (respondent) to tow a drilling rig, owned by the respondent, from Louisiana to Italy. During the tow, the rig was damaged in a storm and the respondent instructed the Unterweser to tow the rig to the nearest port of refuge, Tampa. In Tampa the respondent files suit in admiralty against Unterweser. Unterweser request the district court of Tampa to invoke the forum-selection clause, which was mutually agreed upon in the contract and which provided for “litigation of any dispute in the High Court of Justice in London”. (The Bremen et al v. Zapata Off-Shore Co., 1972) Facts: * “In November 1967, respondent Zapata, a Houston-based American corporation, contracted with petitioner Unterweser, a German corporation, to tow Zapata's ocean-going, self-elevating drilling rig Chaparral from Louisiana to a point off Ravenna, Italy, in the Adriatic Sea, where Zapata had agreed to drill certain wells.” (The Bremen et al v. Zapata Off-Shore Co., 1972, p. 5) * “Zapata had solicited bids for the towage, and several companies including Unterweser had responded. Unterweser was the low bidder and Zapata requested it to submit a contract, which it did. The contract...
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...The Florida, Georgia, Mississippi, and Louisiana shorelines were all affected by the spill causing many issues ecologically for aspects such as jobs and tourism. Some of the industries in the Gulf of Mexico included fisheries, resorts, small businesses and many others that branch off of those main three sectors. When the oil spill occurred it caused a number of these Gulf industries to be temporarily shut down or lose a lot of business. “To minimize human exposure to potentially unsafe seafood from the spill region, more than 80,000 square miles of commercial and recreational fishing grounds were closed while scientists investigated the impact of the spill and clean-up efforts on these organisms”3 Fisheries were concerned about food safety because of the harmful chemicals that remained in the fish even months after the spill; while resorts were not getting as much business because the oil spill reached the shorelines and created a toxic environment which reduced the amount of tourists. The oil spill did not only affect...
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...Ethics in the Workplace Case Study: BP Oil Spill On April 20, 2010 off the Gulf of Mexico, there was a blowout of the Macondo well which is owned by British Petroleum also known as BP. When the blowout took place it got immediate media attention because aspects of the event were known over the world. Within events transpiring it was discovered how limited the resources and reaction to the disaster was going to be. This paper will detail aspects of the event from symptoms of the problem, the root cause, important unresolved issues, roles of the organization’s key players and stakeholders, and explain the focus of specific ethical systems. Also discussed in this paper are relevant strategies and alternatives, the effect of globalization on the choice of preferred alternatives, the most valid alternative and resolution recommendations, and an example of a successful implementation of the solution. Symptoms of the Problem Natural disasters or any disaster of any kind is hard to manage just for the purpose that these is no real planning for the situation and there is no real way to say who is in charge when a disaster happens. Concerning the oil spill with British Petroleum (BP) symptoms for the situation was that there was a delayed response, the impact on the environment and the citizens, federal regulations were lax, and the recovery efforts were not adequate. According to Griggs (2011), OPA 90 is a federal statute that holds all the responsible parties in containment, clean-up...
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...The History of Offshore Oil and Gas in the United States In looking at the history of offshore drilling for oil and gas, it has been a long and grueling process that has revolutionized the industry in its own. Beginning in the 1890s, oil companies have drilled wells in the ocean, but from wooden piers connected to shore. It wasn’t until the 1930’s, that Texaco and Shell Oil deployed moveable barges that were not considered ocean worthy to drill in the South Louisiana marshes. After years of trial and error, in 1938 the first offshore well was constructed by a construction company known as Brown & Foot for two independent oil firms known as Pure Oil and Superior Oil. The well was built in a field known as Creole Field and was considered the 1st offshore drilling site ever constructed. With this drilling site in operation, business opportunities for independent contractors and large oil companies developed with large research development programs in charge of finding new geological environments. With the vast amount of land being unused under the water, oil filled land would revolutionize the future of oil production, and flourish in record breaking profits. It is predicted that the largest hydrocarbon reserves and production during the next several decades will likely come from offshore drilling in deep water beyond 3,000-foot depths. With the offshore drilling and production industry just beginning it was unclear of just how successful it would be. In fact, many...
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...November 14, 2010 Abstract Building more ports and pipelines to transport and distribute crude oil could reduce the time involve in the production process. Gasoline is refined from crude oil. . In general OPEC sets most of the price of crude oil and therefore the price of gas. The Organization of the Petroleum Exporting Countries (OPEC) makes the decisions concerning crude oil, therefore, if crude oil prices increase there is a possibility that gas prices will increase. Unless the oil companies can find another way to extract the oil without drilling there is no way to remain competitive. Production and Operations Management Explain one possible option that Marathon could take to reduce the time involved in the production process. Presently Marathon Oil has the Louisiana Offshore Oil Port (LOOP), located in the Gulf of Mexico, which transports more than one million barrels of crude oil daily – 10 percent of U.S. imports-to-shore through a 48 inch pipe. Additional ports and pipelines can be added to transport and distribute the crude oil (Marathon, 2009). The projected increases in worldwide oil demand in 2030 would require daily crude oil production of 15 million barrels more than current production. The world is looking to the Organization of Petroleum Exporting Countries (OPEC) to supply much of the necessary increased production. The remaining supply is expected to come from non-conventional sources including Canadian oil sands. Deepwater exploration and development...
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...also have a great number of technological resources. The resources that are used include: 3D film that Geologists look at in a room called the HIVE (highly immersive visual environment). In this room, all persons that deal with finding oil come together and view this film to help determine where to drill and how successful they will be in doing so (BP). Finding oil is a science, there isn’t much guessing done without tools and maps to find it. Before there were a host of technology-based programs, oil companies had to search for oil by finding natural oil bubbles that came to surface in what is called a seapage (BP). Even then, there were no true promises that if the drilling began that they would strike gold, they just hoped that there was something deep beyond the earth’s surface. According to BP, “drilling is the only sure way to find out whether there is oil or gas down there”. There are also precautions that are to be made before you drill because it is known to be very expensive. The processes go as such,” we start with what we can see. Both geologists and geophysicists provide crucial insights at this stage in the exploration process. Geologists look at what rocks are made of and the formations they make in the earth. Geophysicists use physical characteristics, such as magnetic and gravitational...
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...BP OIL SPILL Under the Deepwater Horizon, an offshore drilling ring of British Petroleum (BP) caused an oil spill in the Gulf of Mexico. The incident occurred on April 20th 2010, where equipment failed and caused the explosion sinking the ring, and causing the death of 11 workers and more than 17 workers injured. The British based energy company also faced other problems at the site of the oil spill. More than 40 million gallons (estimated data) of oil spewed into the Gulf of Mexico. Oil spill in the Gulf of Mexico is a very serious threat for the wildlife as it causes water pollution. The oil spill effected many coastal areas in the US, like the Louisiana, Alabama, Mississippi and Florida. The oil spill disaster strongly damaged wildlife cycle in the Gulf of Mexico, and many species were thrown into extinction. Similarly, thousands of businesses were thrown into extinction. Many people has questioned the ethical decisions and core value system that BP used to cut corners with the accident; namely, the race to maximize profits at all costs. We are all aware that one of the main causes that let to the disaster were the result of bad decisions, in which a less expensive option (whether to run a test or use a particular kind casing pipe, for example) would save lives. There has been “zero dollars spent on research concerning how to handle oil spills for off-shore drilling by BP despite the company's NET profits - above and beyond all salaries, bonuses, or overhead costs- of...
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...down crude oil into a number of profitable products that includes gasoline, heating oil, and aviation fuel. Marathon delivers more than 111 million gallons of crude oil and petroleum products each day through its pipelines. The company already uses high-speed computers, continuously evolving technology and satellite communications allow the company to supervise and manage its many pipelines throughout the U.S. from a centralized control center (http://www.marathonpetroleum.com). However, as a result of computerizing other aspects of its operations they could get better operations by standardizing and automating other tasks, which will make the process quicker and more efficient. This is computer-integrated manufacturing, or CIM, production technologies in which computers aid workers design products, control machines, handle materials, and control the production function in an integrated fashion (Boone & Kurtz, 2010). In addition to using CIM, Marathon should also create more storage for their oil products, since there is not enough storage capacity at the LOOP off-shore ports. One suggestion would be to build another storage facility closer to the LOOP,...
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...Introduction Oil is an essential part of our everyday living. Historically, the oil and natural gas industry have accounted for approximately 10 percent to 25 percent of the state’s GSP, a trend that roughly tracks the price of oil. drilling rig bores a hole into the earth through which steel pipes are inserted. Pipes or casings like cement would then be put in between for strength as well as for separating different pressure zones- if they exist. The well is then drilled further, and more casings are added. At times, 2-3 layers of casings would be built depending on the geological composition of the zone. The rotator table then passes the drill string onto the hole. The drill string rotating by 'top drive' or 'power swivel' mechanism extends the drill bit. This extension is done with the help of the derrick (the structure holding the drill string). The drill bit then cuts the rock into pieces. Drilling fluid, also called mud-mixture of fluids, chemicals, abrasives and solids - is then pumped down the drill string. This fluid clears the cut rock bits onto the surface. Compressed air is substituted for the fluid, at times. In turbo-drilling, a turbine is placed in the drill string. Mud flows through this turbine causing the drill bit to rotate. This hydrocarbon-rich mixture of crude oil and gases runs our factories, our cars, heats some homes and has provided Americans with an unprecedented standard of living since its discovery in America in 1859. Petroleum is an extremely...
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...operates seven refineries and sells refined products at Marathon-branded gas stations, and through retail subsidiary Speedway outlets. It also holds stakes in 10,000 miles of pipeline, and is one of the largest asphalt and light oil product terminal operators in the US. It distributes petroleum products wholesale to private brand marketers and to large commercial and industrial consumers, as well as to the spot market. The company has operations in more than 20 US states. The phase open to the greatest number of efficiency improvements is the pipeline transport of crude oil. Once the crude oil is in the pipeline it will take about eight to ten days to reach the refinery. “The Capeline Pipeline is a major thoroughfare for crude oil in the U.S., transporting up to one million barrels of crude oil a day…at an average speed of four miles per hour…” (“The time it takes,” n.d.). Transporting oil through pipelines is more economical than transporting over land. If Marathon improves the throughput rate of crude oil delivery they will be able to refine more barrels of gasoline and other petroleum products a day. As previously stated the pipeline can transport up to one million barrels of crude oil a day, and according to marathon.com their refinery network has a crude oil throughput capacity of 1,142,000 barrels per day. Improving the pipeline transport will improve the operating and production efficiency. Discuss the relationship...
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...Legal Issues in Hydraulic Fracturing Demand for energy shows every promise of remaining high, and supplies of natural gas and oil worldwide are dwindling. Renewable and alternative energy sources – for example, wind-generated electricity, or nuclear power – are being developed and considered at the national level; however, at the time of writing more than half of the total energy consumed in the United States comes from oil and natural gas sources. Specifically, natural gas was – in 2011 – providing fully a quarter of the total energy consumed in the United States (Obama, 2013). Hydraulic fracturing, also known as “fracking”, provides a means of exploiting the reserves of natural gas within United States territory. These natural gas reserves are positioned in such a way that they cannot typically be exploited by traditional methods, and instead are produced by a process of hydraulic fracturing. This means of oil and gas production is relatively new, and it remains controversial in terms of economics, safety and environmental cost. In addition to ecological, sociological and political considerations, there are many legal issues involved in the production of energy via hydraulic fracturing (Hagstrom and Adams, 2012). Regulation The actual activity of hydraulic fracturing is carried out by private corporations; however, the process is governed by multiple State and Federal regulations and laws. As the field of hydraulic fracturing is developing quickly and recently, legislation...
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...companies should always be concerned in making sure that all their equipment is running correctly and safety procedures are put into place in order to insure that they do not make any errors. This is especially true for off-shore drilling. Mistakes can cause great amounts of damage to wildlife and to people as well. An oil company that spends any amount of money advertising to the community about their work with the environment and endangered species should also be able to do the same and admit when they have make an error. Our group was faced with a question of whether oil companies should spend more time and money on preventing oil spills or building shelters for some of the endangered species and we found it more important to spend money on preventing the oil spills. Oils spills are always happening. They are mostly small but sometimes they can be large and catastrophic for both land and sea. An example of this problem can be related to BP’s 2010 oil spill caused by off-shore drilling. Big oil companies have “a powerful partner in the U.S. government, which isn't eager to see BP cratered since the cost of cleaning up the mess would then land in its lap“(Sorensen, p. 55). Whether it is bad for business or not if they announce the error they have made, since the U.S. government does not want to deal with the spill alone, they will have to deal with fines but will have help. On top of that “BP also has an estimated US$250 billion worth of assets that it can sell if...
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...Gulf of Mexico Oil Spill and BP Environmental Clean-Up Deb Schoenwether MGMT 312 Creativity & Innovation December 8, 2010 Submitted By: Joe Panayiotou Angela Merryfield Sonya Meggs Lisa Parker Kristi Mathews Introduction: (Lisa Parker) On April 20, 2010, an explosion occurred on an offshore drilling rig in the Gulf of Mexico, killing 28 people. It was later found that the wellhead was damaged and was leaking oil from the British Petroleum (BP) Oil Refinery into the Gulf of Mexico. In a report on the incident issued by BP on September 8, the company admitted that there were weaknesses in the cement design and testing. It is the largest accidental marine oil spill in the history of the petroleum industry. BP is the third largest energy company and the fourth largest company in the world. BP is headquartered in London, United Kingdom. Its largest division is BP America, which is the biggest producer of oil and gas in the United States and is headquartered in Houston, Texas. (Wikipedia, 2010) This significant oil spill poses a serious threat to people, industries, businesses, wildlife and beaches along the coastal areas of Louisiana, Mississippi, Alabama, and Florida. The spill continues to cause extensive damage to marine and wildlife habitats as well as the Gulf's fishing and tourism industries. BP states that they will recruit a series of teams to clean-up the shorelines and workers will receive safety training before clean-up takes place...
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