Bp 2010 Oil Spil
Annual Report Project
Did BP responded adequately and efficiently after the Oil Spill in April 2010
TABLE OF CONTENTS
Introduction p. 1
BP Oil spill characteristics p. 2
Cost Analysis of the spill p. 6
Clean-up of oil spill and recover environment p. 6
Estimation and recognition of the cost………………………………………………..p. 6
Financial highlights…………………………………………………………………….p. 7
1. Sale of Assets/ Opportunity Cost
2. Share Price Drop
3. Debt Increase
Legal .p. 7
Claims
Government fines
Impact on reputation
Conclusion p. 11
Reference List p. 13
Appendices p. 14
Appendix A – Key statistic 2010 p. 14
Appendix B – Table: Gulf Expenses p. 15
INTRODUCTION
As the news of BP oil spill broke out in April of 2010, our first thought as human beings was the loss of human life and its effects on the environment. But as the situation was unravelling and the death of 11 men with several others injured was announced by BP, some of us started to question if BP will be able to survive as an entity?
According to Bob Dudley who replaced Tony Hayward as the CEO of BP during the crisis, “The accident on 20 April 2010 turned into an unprecedented oil spill with deep consequences for jobs, businesses, communities, the environment and oil industry. From this grew a corporate crisis that threatened the very existence of the company.” (Bob Dudley, Summary review 2010, www.bp.com/summaryreview).
Was this disaster too big even for a mammoth like BP to swallow? As commerce students, we were curious how the costs for this oil spill will be allocated by BP. Interesting BP oil spill in itself presents a Case study for any Cost accounting student.
COST OF THE SPILL - Analysis of the research question (from 5 to 8 pages)
BP Oil spill characteristics
British Petroleum was considered to be
Did BP responded adequately and efficiently after the Oil Spill in April 2010
TABLE OF CONTENTS
Introduction p. 1
BP Oil spill characteristics p. 2
Cost Analysis of the spill p. 6
Clean-up of oil spill and recover environment p. 6
Estimation and recognition of the cost………………………………………………..p. 6
Financial highlights…………………………………………………………………….p. 7
1. Sale of Assets/ Opportunity Cost
2. Share Price Drop
3. Debt Increase
Legal .p. 7
Claims
Government fines
Impact on reputation
Conclusion p. 11
Reference List p. 13
Appendices p. 14
Appendix A – Key statistic 2010 p. 14
Appendix B – Table: Gulf Expenses p. 15
INTRODUCTION
As the news of BP oil spill broke out in April of 2010, our first thought as human beings was the loss of human life and its effects on the environment. But as the situation was unravelling and the death of 11 men with several others injured was announced by BP, some of us started to question if BP will be able to survive as an entity?
According to Bob Dudley who replaced Tony Hayward as the CEO of BP during the crisis, “The accident on 20 April 2010 turned into an unprecedented oil spill with deep consequences for jobs, businesses, communities, the environment and oil industry. From this grew a corporate crisis that threatened the very existence of the company.” (Bob Dudley, Summary review 2010, www.bp.com/summaryreview).
Was this disaster too big even for a mammoth like BP to swallow? As commerce students, we were curious how the costs for this oil spill will be allocated by BP. Interesting BP oil spill in itself presents a Case study for any Cost accounting student.
COST OF THE SPILL - Analysis of the research question (from 5 to 8 pages)
BP Oil spill characteristics
British Petroleum was considered to be