BP- Worldwide Network and the US
BP America, which is headquartered in Houston, Texas, is the biggest producer of oil and natural gas in the United States. BP has a history that spans over a century and a half. The company was started in 1892, and its first products were harness oil and hoof grease for buggies.
Today, BP is the leader when it comes to catering to America's traditional energy needs. BP operates approximately about 22,000 oil and gas wells across the U.S, some of which are on Federal lands and waters. 39% of the company's global oil revenue is produced by these oil and gas wells annually. BP America employs about 29,000 people.
Apart from oil and gas wells, BP has 5 modern refineries, 3 chemical plants and thousands of miles of pipelines. The wind power business, which was at zero in 2005, has been built to 1300 MW. BP figures among the biggest blenders and marketers of biofuels in the US, and is the major supplier of fuel to the US military. It has also been the undisputed leader in the solar business for three decades.
Apart from this, BP is also one of the largest gasoline retailers in the U.S. They have over 11,000 service stations through which they market about 22 billion gallons of gasoline every year. BP is renowned for supplying quality fuel to its customers; one of the great product launches by BP in 2008 involved the introduction of Invigorate in three of it gasoline grades. This cleansing formula that cleans the engine, minimizes exhaust emissions and provides better fuel economy. BP's Amoco Ultimate has been rated as the best fuel by drivers nationwide.
BP has also been the leader in the diesel market, and has been commercially marketing an ultra-low sulphur diesel. BP locations also market a variety of other motor oils including BP Premium, BP Premium Select, Castrol GTX, Castrol GTX diesel, etc. BP, being the largest investor in the U.S, wants to continue being a major player in future also. It wants to be able to meet the ever increasing energy demand of the world, which is estimated to increase by almost 49% by the year 2030.
However, BP hasn't had a blemish free history. The oil spill at the Deep water Horizon rig on April 20, 2010, which killed 11 people and injured 17 created uproar among the Americans. Similar incidents in the past like the explosion at the Texas City Oil Refinery in 2005 that killed 15 workers, and the oil spill from the Alaska speak tales of neglect, lax safety standards, and non -conformance to safety commitments that were made by BP. This has adversely impacted the company's reputation and its revenue. After the oil spill in the Gulf of Mexico, BP's stock plummeted by 40%, and the company's value has fallen by nearly $ 50 billion.
The EPA (Environmental Protection Agency) has also been considering an official debarment of BP from the U.S, as it has received four convictions against BP over ten years. This will prohibit BP from supplying fuel to the military, and also end the contract that allows the firm to drill in federally owned lands and waters. This is the major threat currently faced by the company. The decision on debarment has been put on hold until the completion of the inquiry into the Gulf of Mexico incident.
BP's competitors Chevron, Occidental, Exxon Mobil, Petrochina and Murphy oil have been using the Gulf of Mexico incident to their advantage, and have been proclaiming that such incidents can be averted. BP, on its part, has made a few commitments to the people of the U.S, and plans to stick to them this time. It has also set up a $ 20 billion trust to deal with all the claims that might stem from the Gulf of Mexico incident. It has been trying to earn back the trust of the Americans.
The big questions at this juncture are:
-Will the Americans forgive BP for the Gulf of Mexico incident, and put their trust back into it?
-Will the EPA take a tough stand and banish BP from the U.S, impacting the revenue of the nation and causing a huge loss to the company?
-Will BP survive the turbulence it is facing currently, and continue to thrive as one of the biggest oil giants of the U.S?