Rolling Stone has come out with an article on the Gulf oil spill and in it they mention the debate on the size of the spill:
Even after the president’s press conference, Rolling Stone has learned, the administration knew the spill could be far worse than its "best estimate" acknowledged. That same day, the president’s Flow Rate Technical Group – a team of scientists charged with establishing the gusher’s output – announced a new estimate of 12,000 to 25,000 barrels, based on calculations from video of the plume. In fact, according to interviews with team members and scientists familiar with its work, that figure represents the plume group’s minimum estimate. The upper range was not included in their report because scientists analyzing the flow were unable to reach a consensus on how bad it could be. "The upper bound from the plume group, if it had come out, is very high," says Timothy Crone, a marine geophysicist at Columbia University who has consulted with the government’s team. "That’s why they had resistance internally. We’re talking 100,000 barrels a day."
The median figure for Crone’s independent calculations is 55,000 barrels a day – the equivalent of an Exxon Valdez every five days. "That’s what the plume team’s numbers show too," Crone says. A source privy to internal discussions at one of the world’s top oil companies confirms that the industry privately agrees with such estimates. "The industry definitely believes the higher-end values," the source says. "That’s accurate – if not more than that."
And after I read that, I got to thinking "Boy, that’s a lot of money flushing into the Gulf! I wonder how much money?" So I did some math:
If we took the low end number of 20,000 barrels a day and sell those barrels at the low, low price of $70, in one year that would represent the loss of $511 MILLION.
From one well.
But what if it’s really 100,000 barrels a day as the scientists believe and the oil company is privately agreeing is the most probably estimate "if not higher"? Then that would represent an annual loss of $2.5 BILLION.
From one well.
BP owns how many wells? 70? 200? I tried to look it up but all I found was how many fields they operate in, which is in the vicinity of 70 oil fields.
Let’s be stupid here because below you’ll see my point. Let’s assume there’s only one oil well for every oil field that BP operates because it’d take all day to figure out how many actual wells there are. Here’s the problem: in the last quarter, BP claimed profits of $5.5 BILLION. That’s $22 BILLION a year. And that’s way up from last year or the year before, even though a couple years back a barrel of oil hit $100 for a while there.
Now let’s make a wild ass assumption here and assume this blown well in the Gulf represents the most fantastic oil well BP has. This is the Joe Montana’s 49ers of oil wells. No other oil well they have produces HALF what this oil well alone does. We know that’s not true, but let’s just assume for the heck of it that all BP’s other oil wells only trickle out a fourth of what this one does.
That would make $43.5 BILLION for the rest of their oil wells.
But BP has more than 70 oil wells and they produce more than a fourth what this one would produce in a year. In fact, the Andrew oil field has 14 operating oil wells. Machar oil field has a half dozen wells. That’s 20 wells on two fields. Let’s continue to be absurdly lowball in our estimates and say 70 fields only equates to 500 oil wells. That’s 7 per field. But let’s not kid ourselves and keep saying that the Gulf oil spill represents the most fantastic oil well of all time. Let’s say it represents 50% more than what the average oil well produces. So they produce 2/3rds the oil that one does.
500 wells * 2/3 * $2.5 BILLION annually = $833 BILLION a year at $70 a barrel.
But BP would have you believe they only profited $5.5 BILLION last quarter. Only $4.3 BILLION the qtr before. Only $2.6 BILLION the qtr before that.
When this one oil well alone is gushing out $2.5 BILLION dollars of oil a year into the Gulf.
Is it any wonder they don’t want to admit how much oil is really spilling into the Gulf?
How much money do they really make?