BP is one of the world’s six super-major oil and gas companies. It’s a British multinational company formerly known as British Petroleum. The BP Company operates in all areas of the oil and gas industry. The areas include exploration and production, refining, distribution, and marketing.  The company is also involved in petrochemicals, power generation, and trading. And also has interests in renewable energy, biofuels and wind power.

The company has its headquarter in London and have extensive operations in more than 78 countries. The company’s   origins date back to the founding of the Anglo-Persian Oil Company in 1908 that was established to exploit oil discoveries in Iran. In 1935, it was renamed the Anglo-Iranian Oil Company and in 1954, British Petroleum. From then, the company has expanded beyond the Middle East to Alaska and became the first company to strike oil in the North Sea in 1965. British Petroleum later acquired majority control of Standard Oil of Ohio in 1978 before the British government started privatizing the company in stages between 1979 and 1987.

Strategies, goal and mission

After privatization, the British Petroleum started reinventing herself to gain a competitive edge in the oil and gas industry that was currently dominated by the Shell. BP developed new strategies and merged with other companies such as Amoco in 1998 becoming BP Amoco plc. She proceeded to acquire ARCO and Burmah Castrol in 2000 becoming BP plc. in 2001. From 2003 to 2013, BP forged a partnership with the TNK-BP in a joint venture in Russia. Other strategies that have made BP a leading company in the oil gas industry include having two skillful and resourceful mangers at the helm of her leadership (Roberto Michael). During John Browne tenure, the company resorted to  cutting on cost and establishing tough financial targets for each top manager. Then, push the firm to generate a return on investment close to those of her rivals such as Exxon and Shell. As the CEO, John Browne, commissioned the financing deep-water exploration in remotes areas with unpredictable political landscape thereby increasing the  company’s profits and the market capitalization. A campaign with the slogan “Beyond Petroleum” in place of British Petroleum was another strategy that gave the company a global outlook.

The exploration and mining of oil and gas have been fronted as some of the cause of climatic changes. BP is global oil and gas company, therefore they play an important role in setting the pace in the industry. As an alternative and a mitigation measure for the climatic changes, the company has made significant investment in alternative energy. In 2007, Tony Hayward replaced John Browne as the BP’S CEO.  He also introduced new strategies to the company to improve the global stature and profit margin of BP. For example, he organized for the training of the company’s managers about  about risk management at MIT. He also reduced the layers of management and standardized the operations procedures since BP had an unacceptable high overhead costs (Roberto Michael). Hayward said, BP’s performance has materially lagged our peer group in the last three years due to non-consistent and complex organization. These strategies have seen BP become the leading Oil and Gas Company across the globe. The company has also has established clear mission and goals. The company’s goal and mission is to deliver value over volume and become the leading global oil and gas company.

Crucial decisions

Using only six centralizers are devices that ensure that the production casing sat at the center of the well bore, thereby allowing the cement to flow evenly in the space between the casing and the rock. The company had only five centralizers instead of the needed 16 but decided to continue with the installation and opted for a good cement job to save time. Thus, this is negligence on the part of the in-charge manager.

From the investigations, it is  on record that the company’s on-site supervisors allowed the drilling process to continue without waiting for cement stability test results. Then allows for redesigning the cement mixture in case it failed to pass the stability test. The investigation indicates that the cement failed the first stability test conducted at that time, but the company did not report these results to BP (instability meant that the cement mixture could become porous and permeable). Halliburton conducted a second test and shared those results, along with an attached lab report, with BP on March 8 (Roberto Michael). These results also suggested instability, though the first test showed more severe failure than this later one. BP failed to review these laboratory results carefully.

Dismissing Schlumberger personnel, rather than having them perform cement testing to save time and fee of consultations indicates the company’s greed for profit at the expense of best practices. Using the spacer made from lost circulation fluids to avoid disposal issues in another crucial decision that saved the company time in the preparation process. They did not want to deal with hazardous waste regulations that would apply if they had to dispose of these fluids back on the mainland and had a rig crew that has never used this particular type of spacer (The Ocean Portal Team). Displacing mud before putting the cement plug in place due to multitasking and need to save time left an incredible burden for the cement job that normally  prevent the upward flow of the hydrocarbons in the reservoir.

Planning to set the cement plug in seawater 3,000 feet below the mud line and to install the lock down sleeve as the last step in the temporary abandonment procedure was erratic. It was a piloting strategy since there has never been a situation in which BP had set a cement plug that deep in seawater. The company’s decision to go ahead with the negative pressure test and  not installing extra physical barriers along side the cement job to regulate the flow of the hydrocarbon during temporary abandonment is another crucial mistake. Then, not probing further after anomalous results of negative pressure tests shows irresponsibility and negligence of the on-site managers. Multitasking during the process of displacing mud is another undoing that occurred in the Macondo well. The workers and supervisors had a lot to do within a short period so as to commence the oil drilling. These may have led to the evident oversights and hurried preparations leading to the accident (The Guardian). With this crucial erratic decisions and actions below the standard practices required by the industry, it is clear that this incidence was not an accident but an act of negligence. BP should, therefore, be held accountable for the incidence.

Tony Hayward’s performance during the crisis

As the BP’s CEO, Hayward opted to minimize BP’s role in the incident by downplaying the significance of the oil spill instead of assuming responsibility and finding ways to mitigate the crisis. It is evident that, the oil spill was a disaster that left 11 crew members dead, dozen injured and had substantial environmental degradation lasting over three months yet he found time to participate in a yacht race. These incidences come out as negligence on his part as the CEO of a multinational company; therefore, I would say he failed in his duty. As the CEO of BP, I would seek for ways of mitigating the aftermath of the spills together with the environmental experts. The whole accident appears to be an act of negligence on the part of the company’s supervisory and managing directors; therefore, I would establish a commission to look into the incidence. Then establish ways of compensation and restructuring the management to ensure that the incidence does not affect the company’s profits and market capitalization.

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