Home > A Little Blue Marble Called Earth > Anadarko: Key playing with fire.

Anadarko: Key playing with fire.

Ok, the Prime Minister wants to talks issues?  Let’s talk issues. Let’s talk about Anadarko…

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It seems that the “teapot Tapes” are not the only thing that John Key has been keeping from the public, according to some investigative digging by TV3 News,

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Full Story

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In normal circumstances it would seem unusual that a Prime Minister would keep such a top-level meeting secret. One would think that it should be quite a coup to have the a visiting CEO of such a large corporation visiting New Zealand. Especially where there is Big Money to be made.

Remember when Warner Bros  executives visited New Zealand in October last year – the visit was trumpetted by John Key, who laid on ministerial vehicles to chauffer the visiting movie VIPs around Wellington. No expense spared; no amount of publicity was enough; the PM had an opportunity to tell the country that he was In Command, and by golly, he wasn’t shy in showing it!

Which begs the question: why has John Key suddenly become shy about introducing his corporate guests from Anadarko,  to New Zealanders, as he did with our cuzzies from Warner Bros?

Why indeed.

Anadarko’s  role in the  Deepwater Horizon project – which spewed 627,000 tonnes of crude oil into the Gulf of Mexico – was a 25% ownership interest in the Macondo Prospect, which was operated by BP.  As such, they were liable for a portion of the clean-up costs and BP duly obliged by presenting Anadarko with a US$4 billion clean-up bill.

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Explosion and fire at Deepsea Horizon Drilling Rig, 20 April 2010, killing 11 men and injuring 17 others.

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It should be noted that, at first, Anadarko refused any liability in the Gulf of Mexico disaster. In June 2010, BP billed Anadarko for $272 million for its share of cleanup  costs in the Gulf. Anadarko refused point blank, with CEO Jim Hackett stating,

““The mounting evidence clearly demonstrates that this tragedy was preventable and the direct result of BP’s reckless decisions and actions. BP’s behavior and actions likely represent gross negligence or willful misconduct and thus affect the obligations of the parties under the operating agreement.” ” Source

Anadarko’s attempt to evade their portion of liability didn’t work and they ended up with an even bigger bill. Not only that, but Moody’s Investors Service downgraded Anadarko’s credit rating from Baa3 to Ba1 – or junk status.

This is the company that John Key is considering dealing with and allowing to deep-sea drill in our waters,

  • Anadarko was partly-responsible for the Deepsea Horizon oil spill.
  • Anadarko attempted to escape it’s liabilities.
  • Anadarko refused to pay $272 million for its share of cleanup  costs in the Gulf.
  • Anadarko eventually settled with BP for $US4 billion.
  • Anadarko’s credit rating was downgraded to junk bond status. (Though Moody’s may review this rating.)

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One question that begs to be asked is how financially secure Anadarko is, after it’s payout to BP of US$4 billion?

Could Anadarko afford to pay for another massive clean-up, if one of it’s deep-sea drilling rigs suffered a similar calamity to the Deepsea Horizon explosion and oil spill?

And would it accept liability? It has already tried to evade its responsibilities once. The indication is clear, that Anadarko’s first priority is it’s own survival and profit bottom-line. Taking immediate responsibility  for a mishap – especially an expensive one – seems not to be part of their corporate mission statement.

Was John Key aware of any of this when he entertained James Hackett on Tuesday?

If  John Key was aware, why is he dealing with a company that tried to evade responsibility for a disaster, and now currently has a junk-bond credit rating?

How prudent is it, dealing with such a company?

Why was it done in secret?

And has John Key and his ministers learnt nothing from the recent ‘Rena’ stranding?!

Well, John Key wanted to get away from you-know-what, and discuss issues. Here is one issue that he might care to explain to the New Zealand people.

How about it, Mr Key? Are you up for discussing issues?

Preferably before 26 November.

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Contacts

Facebook: Save Otakou from Oil Drilling

Facebook: Anadarko OUT of Otakou!

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Additional reading

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Moody’s cuts Anadarko ratings to junk status

Meet Anadarko, The Oil Company Struggling To Get Off The Hook For The Gulf Spill

BP Bills Anadarko $272 Million In Gulf Spill Response

Anadarko and BP settle Deepwater Horizon dispute

Moody’s considers upping Anadarko debt rating after Deepwater settlement

Nats plan greater gas and oil exploitation

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  1. Peter Martin
    17 November 2011 at 11:50 pm

    Page 29 of the company’s 2010 annual report states:

    “In addition to increased governmental regulation, we currently expect that insurance costs will increase across the energy industry and certain insurance coverage may be subject to reduced availability or not available on economically reasonable terms, if at all. In particular, the events in the Gulf of Mexico relating to the Macondo well may make it increasingly difficult to obtain offshore property damage, well control and similar insurance coverage. The potential
    increased costs and risks associated with offshore development may also result in certain current participants allocating resources away from offshore development and discourage potential new participants from undertaking offshore development activities. Accordingly, we may encounter increased difficulty identifying suitable partners willing to participate in our offshore drilling projects and prospects.
    Further, as the deepwater Gulf of Mexico (as well as international deepwater locations) lacks the extent of physical and oilfield service infrastructure present in shallower waters, it may be difficult for us to quickly or effectively execute any contingency plans related to future events similar to the Macondo well oil spill.
    The matters described above, individually or in the aggregate, could have a material adverse effect on our business, prospects, results of operations, financial condition and liquidity”

    Can it get more dodgy?

  2. fmacskasy
    17 November 2011 at 11:58 pm

    “Reduced insurance coverage”?!

    Peter, I think that goes from dodgy to downright dangerous!

    Much obliged for that very pertinent piece* of information!

    I have emailed the link to my piece above to various MSM. Hopefully they will pick it up and run with it. If Dear Leader tries dodging questions on thios issue, then just WTF does he want to talk about? Moonbeam??

    (I seem to be having an alliterative ‘moment’.)

  1. 2 April 2013 at 8:30 am
  2. 3 April 2013 at 12:02 am
  3. 2 May 2013 at 12:25 pm
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  6. 14 June 2017 at 8:01 pm
  7. 4 December 2018 at 8:01 am

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