New Documents Show BP Made Little Progress on Alaska Safety Issues From 2001 to 2007

Abrahm Lustgarten

BP's Prudhoe Bay oil field facility in Alaska. (Photo by BP via Getty Images) Six years after a scathing 2001 internal review of BP's Alaska operations found that the company wasn't maintaining safety equipment and faced "a fundamental lack of trust" among workers, a follow-up study concluded BP had made little headway in addressing those concerns.

The 2007 review, obtained by ProPublica, is based on a survey of more than 400 BP workers and contractors across Alaska greater Prudhoe Bay drilling fields. Three of four workers surveyed said that BP's maintenance program was still not aligned with BP's business priorities. Workers said that while BP had chipped away at communication and training concerns, it had not reduced maintenance backlogs of key equipment.

Those findings take on new significance as Congress hears testimony from BP executives about what the company has done to improve its safety record and address a litany of operations failures over the last 10 years. In testimony yesterday, BP CEO Tony Hayward said that he had made significant changes in the company since taking the reins in 2007 and that he had focused on safety "like a laser."

The conclusions of the report were crystallized in two PowerPoint slides and a series of graphics that were given to ProPublica by a former senior BP manager. Their validity was confirmed by Marc Kovac, a current BP employee who was part of the original 2001 review team and helped conduct the 2007 follow-up and presented the data to senior management.

Nearly 80 percent of the workers interviewed for the 2007 study said that gas and fire detection systems -- perhaps the most important equipment to saving lives and among the most critical in preventing an environmental disaster -- were either not functioning or were obsolete.

"We found that 50 percent of everything that was originally brought up was not fixed, it was ignored," said Kovac. "BP plays the time game. People forget and they know that. So as long as they file reports and do investigations and produce paperwork, they know that people will eventually go on with their business."

Last week ProPublica disclosed that a series of internal BP investigations, including the 2001 Operational Integrity Review, had found that the company valued production and profits ahead of safety and maintenance. The reports, combined with internal e-mails obtained by ProPublica and several external government reviews of the company, showed that over a period of more than 10 years BP had allowed conditions of facilities to deteriorate in order to save money, and that it retaliated against workers who raised concerns about them.

The disclosure of the 2007 follow-up to that report stands in contrast to BP's public statements from 2001 to 2007, which asserted the company had learned from its mistakes in Alaska and seized the opportunity to change.

BP did not respond to requests for comment for this article, but in a statement made in early June about the apparent pattern of recurring issues at BP operations since 2001, BP spokesman Toby Odone told ProPublica that the "premise about continuing worker safety complaints is essentially groundless."

Source: http://feeds.propublica.org/~r/propublica/energy-environment/~3/Gi462fC6D8E/

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Youngandthrifty Cheap and Good Eats: Thomas Haas Fine Chocolates

It seems to be the trend that I have exhausted all the cheap eats and am focusing on the good eats in Vancouver.  Thomas Haas Fine Chocolates, again, isn’t necessarily cheap (though if you can restrain yourself and buy just one “goodie” to treat yourself instead of a dozen, it can be a cheap treat), [...]

Source: http://feedproxy.google.com/~r/Youngandthrifty/~3/nllYCa1p5R8/

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Buffett's Gloomy View of Our Economic Future?

This morning Warren Buffet's company Berkshire Hathaway announced that it was buying Burlington Northern Santa Fe in a deal valued at $44 billion. In the announcement, Buffett called the purchase an "all-in wager on the economic future of the United States."

Is Buffett right that a bet on Burlington Northern is a bet on the economic future of the U.S.? Because if Buffett is right, we've got real problems.

Let's take a look at what Burlington Northern carries. Its major freight revenues (as of 2008) come from coal (23% of revenues); agricultural products (20%); international intermodal shipments of consumer products, which is probably mostly imports (16%); construction and building products (14%); and petroleum products (4%).

In essence, Buffett is betting that the next ten years will look a lot like the last ten: A lot of growth in imports, construction, energy and agricultural products. If he thought that innovation was going to be the driver of the next ten years--biotech, energy, and infotech--he wouldn't be buying Burlington Northern.

I'm not saying that Buffett is wrong. His skepticism about the tech sector in the late 1990s, and innovation in general, turned out to be right on the mark. Berkshire Hathaway stock over the past decade has risen by 84%, whil the S&P 500 is down by 18%.

But his "all-in wager on the economic future of the United States" paints a remarkably gloomy picture of where we are heading.

Source: http://www.businessweek.com/the_thread/economicsunbound/archives/2009/11/what_does_buffe.html

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The Other Side of Solar: SolarCity Files for IPO

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While solar panel makers have been suffering from falling prices and over-capacity, U.S. solar installers have been taking advantage of the cheap panels and devising new financing schemes to grow their businesses. One of the largest of these installers, SolarCity Corp., has filed a Form S-1 with the SEC saying that the company wants to conduct an IPO to raise $201 million. The is a preliminary filing and does not include the number of shares to be offered or the offering price.

Underwriters for the offering are Goldman Sachs, Credit Suisse, BofA/ML, Needham & Co. and Roth Capital Partners. Shares will trade on Nasdaq under the ticker symbol 'SCTY'.

SolarCity, in which Tesla Motors Inc. (NASDAQ: TSLA) CEO Elon Musk holds a stake of about 32%, said that it would use the proceeds from the offering for "general corporate purposes, including working capital, capital expenditures and potential acquisitions of complementary businesses, technologies or other assets." The company currently has 56.56 million shares outstanding, excluding about 27 million common stock options and preferred shares.

Of the shares to be sold about 108,000 will be offered by current shareholders. An over-allotment option pool of 790,474 shares will be available from Lyndon and Peter Rive, the company's founders. The Rives are cousins of Musk.

SolarCity has done well by offering solar rooftop installation for which the homeowners then sign a power-purchase agreement for 20 years. Excess electricity is sent back to the grid. SolarCity will also sell complete systems to homeowners who wish to purchase them.

In 2011, SolarCity reported revenues of $59.55 million and a net loss of $73.7 million. In the first six months of 2012, the company reports revenues of $71.4 million and a net loss of $48.9 million. However, due to the way the company accounts for revenue, net losses to stockholders totaled $43.5 million and $23.1 million in 2011 and the first half of 2012, respectively.

A full-copy of the filing is available here.

Paul Ausick


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Source: http://www.dailyfinance.com/2012/10/08/the-other-side-of-solar-solarcity-files-for-ipo/

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