BP's Continuing Safety Problems: The Gulf of Mexico Crisis

            
 
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Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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Case Details:

Price:

Case Code : BECG116 For delivery in electronic format: Rs. 500;
For delivery through courier (within India): Rs. 500 + Rs. 25 for Shipping & Handling Charges

Themes

Business Ethics / Corporate Social Responsibility
Case Length : 19 Pages
Period : 2005-2010
Organization : BP
Pub Date : 2010
Teaching Note : Not Available
Countries : US
Industry : Petroleum

Abstract:

This case is about the Gulf of Mexico oil spill and the continuing safety problems at BP, one of the largest oil and gas producers in the world. The British oil giant with a history of repeated safety violations was held responsible for the oil spill in the Gulf of Mexico. The spill was caused by an explosion aboard an offshore drilling rig leased by BP. Eleven workers were feared dead and fifteen injured in the explosion. After the explosion, the rig sank 5,000 feet to the ocean floor and since then at least 210,000 gallons of oil a day had been leaking into the Gulf. The case describes in detail the consequences of the oil spill, considered to be the worst ever environmental catastrophe in US history caused by an industrial disaster. According to experts, the oil spill would adversely impact the environment as well as human and marine life in the Gulf region.

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The case highlights the ethical issues involved in the disaster and examines BP's response to it. Though the company accepted responsibility for the explosion and was making efforts to manage the oil spill, it remained largely unsuccessful in plugging the leak. As efforts to contain the spill continued, critics alleged that BP had put profits before safety and developed an "unhealthy corporate culture" where cost-cutting was given more priority than the safety of the workers.

Issues:

Study the factors that led to the Gulf of Mexico oil spill.

Analyze the responsibilities of BP in the event of the spill.

Understand the importance of the safety culture and process safety management.

Understand the effects of the oil spill on the company in particular and the oil industry in general.

Examine the approach adopted by BP in managing the spill.

Contents:

  Page No.
Yet another Disaster at BP 1
Background Note 2
Safety Issues in the US 4
The Gulf of Mexico Disaster 6
Putting Profits Ahead of Safety? 8
Consequences 9
Outlook 12
Exhibits 13

Keywords:

Business ethics, Transnational aspect of the ethics debate, Multinationals in transnational accountability, Corporate social responsibility, Corporate accountability, Environmental disaster, Greenwashing, Environmental responsibility, US environmental and safety laws, process failure, cultural failure, management failure, Gulf of Mexico, BP

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