Ethics Discussion Bp Oil

Topics: John D. Rockefeller, Stock, Economics Pages: 2 (714 words) Published: April 15, 2013
The decision whether to close the Lima, OH plant has not been easy to make. There have been many arguments as to why and why not the plant should remain open or be closed. As the VP of Finance for BP, I have kept an open mind and looked at the advantages and disadvantages of closing the plant. I will now discuss some of these arguments in the following paragraphs. The first argument as to why the plant should remain open is the 30% increase in productivity. Lima, Ohio has a population of 48,000 and in the years that this plant has operated here, there has been dramatic increase in productivity in a time where refinery margins began shrinking. This increased productivity led to lower operating costs for the company. As a result of this increase in productivity BP executives decided to implement the Lima innovations around the world. This shows that Lima has been a leader in refinery innovation and has contributed greatly to the success of BP. The second argument as to why the plant should remain open is the obligation to the local community. The city not only relies on the refinery for 500 jobs and a $31.5 million payroll. If BP closes the plant, many jobs will be lost in the community and lead to economic hardship for the previous employees. Not only this, but Lima depends on the refinery to uphold its identity. It was there that John D. Rockefeller struck oil a century ago for Standard Oil Company. If BP goes ahead and closes the plant, this entire community will need to find a new identity, which may never happen. The first argument as to why BP should close the plant is that it will be in the best interest of the shareholders. BP has stated that any refinery that was not “world class” with net margins in the top 25% around the world would be closed or sold. If the refinery is operating at a margin not in the top 25%, it will be more expensive for BP to keep the plant open in the long run. This will lead to more expenses for the company. The money lost from...
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