BP's Secret Blowout

BP's

Secret Deepwater Blowout

by Greg Palast

Only 17 months before BP's Deepwater Horizon rig suffered a deadly blowout in the Gulf of Mexico, another BP deepwater oil platform also blew out.

You've heard and seen much about the Gulf disaster that killed 11 BP workers. If you have not heard about the earlier blowout, it's because BP has kept the full story under wraps. Nor did BP inform Congress or US safety regulators, and BP, along with its oil industry partners, have preferred to keep it that way.

The earlier blowout occurred in September 2008 on BP's Central Azeri platform in the Caspian Sea.

As one memo marked "secret" puts it, "Given the explosive potential, BP was quite fortunate to have been able to evacuate everyone safely and to prevent any gas ignition." The Caspian oil platform was a spark away from exploding, but luck was with the 211 rig workers.

It was eerily similar to the Gulf catastrophe as it involved BP's controversial "quick set" drilling cement.
The question we have to ask: If BP had laid out the true and full facts to Congress and regulators about the earlier blowout, would those 11 Gulf workers be alive today - and the Gulf Coast spared oil-spill poisons?

Greg Palast investigating BP's blowout in the Caspian, Baku, Azerbaijan 2010.

The bigger question is, why is there no clear law to require disclosure? If you bump into another car on the Los Angeles freeway, you have to report it. But there seems no clear requirement on corporations to report a disaster in which knowledge of it could save lives.

Five months prior to the Deepwater Horizon explosion, BP's Chief of Exploration in the Gulf, David Rainey, testified before Congress against increased safety regulation of its deepwater drilling operation. Despite the company's knowledge of the Caspian blowout a year earlier, the oil company's man told the Senate Energy Committee that BP's methods are, "both safe and protective of the environment."

Really? BP's quick-dry cement saves money, but other drillers find it too risky in deepwater. It was a key factor in the Caspian blowout. Would US regulators or Congress have permitted BP to continue to use this cement had they known? Would they have investigated before issuing permits to drill?

This is not about BP the industry Bad Boy. This is about a system that condones silence, the withholding of life-and-death information.

Even BP's oil company partners, including Chevron and Exxon, were kept in the dark. It is only through WikiLeaks that my own investigations team was able to confirm insider tips I had received about the Caspian blowout. In that same confidential memo mentioned earlier, the US Embassy in Azerbaijan complained, "At least some of BP's [Caspian] partners are similarly upset with BP's performance in this episode, as they claim BP has sought to limit information flow about this event even to its [Caspian] partners."

In defense of its behavior, BP told me it did in fact report the "gas release" to the regulators of Azerbaijan. That's small comfort. This former Soviet republic is a police state dictatorship propped up by the BP group's oil royalties. A public investigation was out of the question.

In December, I traveled to Baku, Azerbaijan's capital, to investigate BP and the blowout for British television. I was arrested, though, as a foreign reporter, quickly released. But my eye witnesses got the message and all were too afraid tell their stories on camera.

BP has, in fact, never admitted a blowout occurred, though when confronted by my network, did not deny it. At the time, BP told curious press that the workers had merely been evacuated as a "precaution" due to gas bubbles "in the area of" the drilling platform, implying a benign natural gas leak from a crack in the sea floor, not a life-threatening system failure.

In its 2009 report to the US Securities and Exchange Commission (SEC), BP inched closer to the full truth. Though not mentioning "blowout" or "cement," the company placed the leak "under" the platform.

This points to a cruel irony: the SEC requires full disclosure of events that might cause harm to the performance of BP's financial securities. But reporting on events that might harm humans? That's not so clear.

However, the solution is clear as could be. International corporations should be required to disclose events that threaten people and the environment, not just the price of their stock.

As radiation wafts across the Pacific from Japan, it is clear that threats to health and safety do not respect national borders. What happens in Fukushima or Baku affects lives and property in the USA.

"Regulation" has become a dirty word in US politics. Corporations have convinced the public to fear little bureaucrats with thick rulebooks. But let us remember why government began to regulate these creatures. As Andrew Jackson said, "Corporations have neither bodies to kick nor souls to damn."

Kicking and damning have no effect, but rules do. And after all, when international regulation protects profits, as in the case of patents and copyrights, corporate America is all for it.

Our regulators of resource industries must impose an affirmative requirement to tell all, especially when people, not just song lyrics or stock offerings, are in mortal danger.

*********
Greg Palast directed the fraud investigation of BP and Exxon in the grounding of the Exxon Valdez for the Chugach Natives of Alaska. Palast's investigative reports can be seen on BBC Television Newsnight. See them at www.GregPalast.com.

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BP is the lead shareholder in the 1,100-mile long oil pipeline, which runs from Baku, Azerbaijan, through Georgia to the Turkish seaport of Ceyhan. In addition to opening up an alternative supply to the US (which has long been in search of an oil source outside the Middle East), the project has led to allegations of human rights abuses, sparked regional conflict, and deprived local people of their livelihoods and land. By 2010, The pipeline was scheduled to deliver an estimated one million barrels of oil a day, predominantly to the already saturated Western markets.

Related articles

• BP Sues Cameron International, Blowout Preventer Maker, For Device That Failed To Stop Oil Spill (huffingtonpost.com)
• Cameron Responsible for Oil Well Blowout, BP Says in Suit (businessweek.com)
• BP sues Gulf oil rig kit provider (bbc.co.uk)
• APNewsBreak: BP sues maker of blowout preventer (boston.com)
• BP's Gulf Oil Spill: One Year Later (scientificamerican.com)
• One Year After The BP Oil Disaster, What Has Changed? (fastcompany.com)
• Analysis: A year after BP spill, drilling risks linger - Reuters (news.google.com)
• Robert L. Cavnar: A Year After the BP Blowout: What We've Learned. And Haven't. (huffingtonpost.com)
• Given to or marked by deliberate deceptiveness in behavior or speech (jcwinnie.biz)
• Deepwater Horizon and the Gulf oil spill - the key questions answered (guardian.co.uk)

Food Prices on the Rise again

Why you're paying more for groceries

 By Ben Rooney

NEW YORK ( CNNMoney ) -- After holding steady for two years, food prices in the United States are rising once again, due to growing demand and tight supplies of wheat, corn and other key commodities.

 

That means American consumers are being hit with higher grocery bills at a time when gas prices are already starting to dent household budgets. On the bright side, economists say the recent spike in fuel prices isn't yet translating into higher costs at the supermarket.

For the moment, food producers and retailers have been absorbing higher energy costs and have pledged not to pass them on.

Still, according to the U.S. government's Consumer Price Index, food prices in January rose 1.8% from the prior year, marking the fastest pace since 2009.

 "We are already starting to see food inflation kick in," said Brian Todd, president of the Food Institute, a nonprofit research group in Elmwood Park, NJ.

A 16 oz. bag of potato chips, for example, sold for an average price of $4.79 nationwide, according to January CPI data. That's up 5 cents from the same month last year, and nearly $1.40 more than in 2001. Prices for bread, bacon, eggs and many other consumer staples were also significantly higher.

Those increases can add up quickly for consumers already struggling with rising gas prices, high unemployment and stagnant wage growth. In 2008, the average taxpayer earned just $33,000 a year, which is actually down from twenty years ago.

Food prices are currently being driven higher by spiraling costs for basic agricultural goods, which have been impacted by bad weather in many parts of the world. Tight supplies of grains have in turn pushed up prices for the livestock that eat them, resulting in higher prices for beef and pork.

In addition, growing prosperity in China, India and other developing economies has led to increased demand for meat and other higher-end food items. 

Chinese consumers squeezed by rising prices 

Overall, retail food prices are expected to rise between 3% and 4% this year, according to the U.S. Department of Agriculture. That would follow a more modest increase in 2010, when food prices rose 1.5%, and a slight decrease in 2009, as the global recession took hold.
 

But the outlook for food inflation is still only slightly above the historical average of between 2% and 3%, said Ephraim Leibtag, an economist at the USDA's Economic Research Service.

The 2011 forecast is also below the 5.9% rise in food prices that occurred in 2008, when oil and gas prices surged to all-time highs.

"There are some similarities with 2008," this year, said Leibtag. "There's the potential for prices to rise over the year, but there's also time to readjust."

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Americans Targets of Mexican Drug Gangs

U.S. Warns of Mexico Peril

Consulate Says Americans May Be Targets of Drug Gangs; 32 More Bodies Found

By NICHOLAS CASEY And JOSé DE CóRDOBA

MEXICO CITY—For the first time in Mexico's drug war, the U.S. government said its employees and citizens could be the targets of drug gangs in three Mexican states, a disclosure that could signal danger for Americans south of the border.

The little-noticed warning, published last Friday in a warden's message from the U.S. Consulate General in Monterrey, said U.S. officials had "information that Mexican criminal gangs may intend to attack U.S. law-enforcement officers or U.S. citizens in the near future in Tamaulipas, Nuevo León and San Luis Potosí."

In Tamaulipas state, 32 bodies were found in mass graves on a ranch on Tuesday, bringing the total discovered there since last week to 120, authorities said. On Friday, the U.S. State Department said an American man was reported kidnapped from a bus in the state, but it wasn't known if he was among the dead.

The Consulate's message could have major implications for Americans across Mexico, who have lived in and visited the country under assurances from both governments that drug-related violence wasn't directed toward them. An estimated one million U.S. citizens live in Mexico and millions more visit each year.

Among the cities covered in the warning is Monterrey, the country's northern business hub where U.S. companies like Whirlpool Corp. and General Electric Co. have their regional bases.

Tamaulipas state shares 230 miles of border with Texas and handles important cross-border traffic through Nuevo Laredo and Reynosa; San Luis Potosí is a popular tourist destination, famous for its silver mines.

Whirlpool declined to comment on the warning. GE didn't immediately have a comment.

A division president of one major U.S. company canceled a planned visit to Monterrey scheduled for the end of April after the Consulate warning, company officials said.

U.S. State Department officials wouldn't comment on what triggered the warning.

"My guess is that this is a generic threat that they want to take seriously but not send people into panic mode," said Eric Olson, a senior associate at the Woodrow Wilson International Center for Scholars. "Phrases like 'may intend' and 'near future' sound very unspecific to me, although worrisome nonetheless."

Mexican officials had no immediate comment on the warning, which seemed sure to add to rising tensions between Washington and Mexico City over the drug war. U.S. Ambassador Carlos Pascual was pressured to resign recently after comments he made about the Mexican army's inefficiency in diplomatic cables and published by WikiLeaks angered President Felipe Calderón.

Until recently, experts and officials on both sides of the border agreed that Mexican drug cartels focused their attacks on rivals and the occasional Mexican law-enforcement official but had little incentive to target outsiders.

Recent events have begun to call that assumption into question, including the killing of a U.S. Immigration and Customs Enforcement officer and the wounding of another in San Luis Potosí in February by gunmen from a drug gang.

"This is definitively an increase in the level of concern," said Jay Cope, a senior fellow at Washington's National Defense University. The incidents involving Americans make people wonder if "we are beginning to see a pattern begin to emerge now that hadn't seemed to be a pattern before," Mr. Cope said.

Last year, 107 American citizens were victims of homicide in Mexico, according to the State Department, up from 77 homicides the year before.

The warning followed the recent grisly discovery of mass graves on a ranch in the Tamaulipas county of San Fernando. The fact that there are at least a dozen graves suggests victims may have been killed in separate incidents.

Mexican authorities are pointing to a criminal gang known as Los Zetas, one of Mexico's most powerful and barbaric drug gangs, which officials say had stopped buses on state highways and kidnapped passengers.

The fact that the warning focuses on three states where Los Zetas is active suggests that gang might be the one to potentially target U.S. citizens, analysts said. In the past year, Los Zetas have come under intense pressure from rivals in the trade and Mexico's army and police forces.

"The Zetas have become so disorganized or so desperate that they could take action against U.S. citizens," said Andrew Selee, director of the Mexico Institute at the Woodrow Wilson Center in Washington, adding that the discovery of the mass graves "suggests their behavior has now passed the bounds of rational thinking, even for criminal enterprise."

Not everyone agreed. Raul Benítez, a security expert at National Autonomous University of Mexico, doubted that U.S. law enforcement agents or tourists are in danger of becoming targets for the cartels. "The narcos don't target gringos—they are too scared of U.S. intelligence services," he said.

An exodus of Americans already began last year in the business hub of Monterrey, as some executives and their families moved north to Texas or south to Mexico City. Caterpillar Inc. said last year it had relocated some 40 employees and their family members from places in Mexico, including Monterrey.

Dave Long, the pastor at the Union Church in Monterrey, said a few of his church members had expressed worry about the new consular warning. Mr. Long said the church has lost about 50 families of the congregation in the past year, the vast majority Americans leaving due to security concerns. For his part, Mr. Long said he is staying in Monterrey and takes normal precautions, like not driving late at night or to the border through neighboring Tamaulipas state. "I survived Idi Amin in Uganda, so we aren't planning to leave," he said.

In a recent survey of businesses by the American Chamber of Commerce in Mexico, 67% reported their member company felt less secure than the year before, with more than half attributing the problems to organized crime groups.

This year has included some grisly slayings of Americans. In January, Nancy Davis, a 59-year-old missionary was shot in the head after being ambushed in her car near San Fernando. Her husband raced her car across a border bridge against traffic into Texas, where she later died.

And last year David Hartley, an American riding a jet ski on the Mexican side of a lake on the Texas border was abducted, his body never found. Shortly afterward, the severed head of a detective on the case was found in front of a Mexican army barracks.

Mr. Benítez said the target audience of the Warden statement could be the Mexican government. "It's a warning to the Mexican government to better control those areas," Mr. Benítez said.

—James R. Hagerty, Clare Ansberry and David Luhnow contributed to this article.

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Another Day Another Dollar

Last-minute deal averts government shutdown

Congressional negotiators strike a deal to fund the government for the rest of the year. The agreement includes $39 billion in cuts and does not include provisions on Planned Parenthood or the Environmental Protection Agency.

By Michael A. Memoli

Congressional negotiators struck a last-minute deal to fund the government for the rest of the fiscal year, congressional leaders and the White House said late Friday, averting a threatened shutdown.

The House and Senate are expected to approve a five-day stopgap measure to keep the government running until the final details of the agreement can be worked out.

Talks continued deep into the evening until, finally, House Speaker John A. Boehner (R-Ohio) met with his caucus to outline the details of the proposed compromise, one in which Republicans succeeded in securing $39 billion in cuts from current spending levels.

The GOP avoided a shutdown that many Republicans feared would damage the party politically in the eyes of the American public, one that would have resulted in the furloughs of 800,000 federal workers, the closing of national parks, and the disruption of many government services.

Democrats could take solace that none of the Republican House's proposed policy provisions, including one to defund Planned Parenthood that consumed much of the attention of the final day of negotiations, along with riders that would have limited the power of the Environmental Protection Agency, were included in the final package.

Appearing briefly before reporters to announce the deal, Boehner said a final vote would take place next week.

"This has been a lot of discussion and a long fight," Boehner said. "We fought to keep government spending down." He did not take questions.

Moments later, President Obama hailed the tentative agreement from the Blue Room of the White House.

"Americans of different beliefs came together again," he said, the Washington Monument visible behind him. "The government will be open for business."

As part of the accord, the Senate will hold standalone votes on the Planned Parenthood provision as well as a measure that would defund President Obama's healthcare initiative. Neither vote is likely to pass.

The possible deal comes after a day of private negotiations and public posturing over how and how much the federal government should spend for the rest of the fiscal year, which ends Sept. 30.

Both sides said they wanted to avoid a government shutdown. On the floors of the House and Senate and before television cameras throughout the Capitol, members of Congress expressed deep regret over a looming shutdown while pointing fingers across the aisle.

Congressional leaders had shuttled between the Capitol and the White House all week, but Obama did not take part in direct talks on Friday. He had canceled a planned trip to Indiana to discuss energy, and also a planned weekend getaway with his family to Williamsburg, Va.

Facebook Scam

Beware Facebook 'Photoshop' Scam

If you are not already one of hundreds of thousands of Facebook users duped into a "photoshop" scam, congratulations. More than 600,000 others have fallen prey to this latest Facebook scam.

Here's how it works.

You see a message on your Facebook Chat window from a friend that reads, "hey, i just made a photoshop of you."

There's also a link in the message to a third-party application, which asks for access to your profile in the same manner as many other outside apps. The app asks for access to your Facebook information, including your name, gender, photo, networks, lists of friends, user ID plus access to your Facebook Chat, reported The Huffington Post.

If you click "allow," the attack begins. The app distracts victims with pictures of animals with human-like faces. The app then starts spamming your Facebook friends via Chat.

M86 Security Labs , which was monitoring the scam on Monday, reported that it was "spreading rapidly" with more than 88,000 clicks per hour.

With more than 600 million active users around the world, Facebook has become a popular target for spammers. Viral scams can kick into high gear after only a few clicks, reported The Atlantic .

"At this point, we do not know what the end game is for the scammers here," according to M86 Security Labs. "The destination site results in no malicious infection and does not lead to a survey scam. Having access to a users' Facebook Chat could allow the scam application to be used to send out other messages."

The best thing to do if you have fallen for this scam is to remove the app immediately.

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Facebook and Divorce

Facebook Divorce Rate In 2011: New Statistics
By: Peter Chubb

Having already discussed “Social Networking Etiquette“, we thought we would take a look at another issue, and that is the Facebook divorce rate in 2011. These new statistics seem a little worrying, and for good reason, as divorces have been on the rise not only because of Facebook but other social websites as well.

The reason for this is due to the fact that people are now able to use websites like Facebook to cheat on their partners, many of us have seen for ourselves how people behave on Facebook, this is just another one of those behaviors. Do not think that this gives you the green light to go out and have an affair, as social networking websites are also being used to catch you out.

According to one report on TheTechJournal, more than 20 percent of an online divorce lawyers case list was because of an affair that started on Facebook. However, not all of them involve sexual relations, “The most common reason seemed to be people having inappropriate sexual chats with people they were not supposed to.”

Having said that, this is still no excuse and no chats of a sexual or flirty nature should happen if you are in a committed relationship – unless you have an understanding of-course.

There is even a case where one woman learned that her husband was divorcing her via Facebook, as he was seeing someone who he met on The Social Network. One thing we do know looking at the latest statistics, Facebook and MySpace pages will now be introduced more and more over the coming months in divorce courts, so you had best watch out.

Have you ever caught your partner out on Facebook or MySpace?

 

‏

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Politics, Facebook and Your Privacy

Why Facebook’s Political Moves

Should Terrify Us All

by JD Rucker

Power is often something that is earned. It’s also something that can be taken by making the right moves. As Facebook continues to expand its reach in Washington, alarm bells should be ringing in every one of our skeptical minds.

For the most part, it will go unnoticed. It’s like the perfect bomb – two components that are benign by themselves but deadly when mixed. While most would say that neither Washington nor Facebook are benign, it should be noted that the potential of combining the entities is more than just dangerous. It will prove to be deadly.

There will be those who say that everything I’m about to write is paranoid gibberish or unfounded analysis. Believe what you will, but don’t be foolish or blind. This is a potentially dangerous situation. Here’s why:

The Unholy Alliance

The moves that Facebook plans on making go well beyond getting lobbyists to protect their interests. Currently, Facebook’s only public-facing interest is control over basic Internet functions – pageviews, eCommerce, social influence, and access. Facebook is already exceptional at controlling pageviews. Their eCommerce department is working feverishly (albeit stealthily) to embed Facebook as a centralized middleman for buying and selling through the Internet. Their social influence is unquestioned and nearly unchallenged. Access – new websites are born every day that encourage or require logging in through Facebook.

Rather than hiring lobbyists, Facebook is hiring Washington insiders. They already have a COO in the form of former Clinton administration official Sheryl Sandberg, a General Counsel in the form of former Supreme Court Justice Antonin Scalia clerk Ted Ullyot, and they are eying President Obama’s former White House press secretary Robert Gibbs for their communications team.

This is just the beginning.

The only reason a company would pay the premium to get politicos on board is to have the influence and clout to make serious moves in Washington. That’s it. There’s no other valid reason. With 3, it could be a coincidence. We expect to see more down the line.

What moves could they possibly be considering? What do they want, and what would they have to offer?

This is where the speculation goes off the reservation. Facebook is a longshot candidate to be involved with the proposed National Internet ID. That longshot status could change quickly if they are able to convince the administration that they possess both the skills and the manpower to make it a reality in a way that people will be willing to embrace.

There are other things they want in Washington, but this is the big prize. Because the concept of a National Internet ID is to protect people while online and encourage eCommerce, Facebook is poised to be a recipient of some form of benefits once it’s in place. They could help administer it at the high end. They could be an integrated partner on the low end. Either way, they win.

As far as what they have to offer, it’s pretty clear. They have the data. They have the users. They have the attention of the nation and the world in a way that no other website has truly held. Even Google is useful but not as integrated into our day-to-day lives the way Facebook is.

They will never admit it, but it’s the biggest thing they have that the government wants. Are you scared yet?

Why It Should Scare You

The National Internet ID as a concept should terrify you already, but Facebook would double the danger. You see, Facebook as a company does not have a track-record of having our best interests in mind or of protecting our information in any way, shape or form. Their political aspirations go beyond Farmville and poking. They are making a play for real power.

The US government does not have a strong track-record of wielding their power in ways that the people want. Sure, this is a democracy, but did we vote to be groped? Did we tell the government it was okay to wiretap citizens without a court order? The questionable decisions go on and on. Add Facebook’s trillions of bits of data about us, our friends, and our activities to the mix and suddenly you have a recipe for 1984.

Big Brother won’t just be watching if Facebook gets more ears in Washington.

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