BP Will Pay Spill Victims, But PR Damage Is Done

(April 30) -- The CEO of BP wants the world to know that the company will compensate those affected by the sinking and continued leaking of its Deepwater Horizon oil rig -- a bill that could easily run into the billions. What remains to be seen is if any amount of money could restore the environmentally friendly image it had heavily invested in. For all of BP's public relations work, the spill has reminded the public that it is still very much a Big Oil company.

The company, which traces its roots to the 1909 founding of the Anglo-Persian Oil Co., began a serious green marketing campaign about a decade ago. In 1997, it introduced a new corporate slogan, "Beyond Petroleum," and three years later a new logo, a green and yellow helios symbol that alluded to its commitment to alternative energy. Through acquisitions, the company is a leading producer of solar panels, and has announced it would invest $8 billion in alternative energy through 2015.

But in the greater scheme of its business -- BP has an annual revenue of about $250 billion -- such efforts are comparatively small. Even before the accident, the company's many critics accused BP of "greenwashing," talking the talk on clean energy but not walking the walk.

In a chapter she wrote for the 2002 book "Battling Big Business," Sharon Beder laid out BP's less-than-pristine environmental track record. In 1991, it was cited as the most polluting company in the U.S. Eight years later, it was fined $1.7 million for burning polluted gases at its Ohio refinery. In 2000, it paid another $10 million fine to the Environmental Protection Agency for air pollution.

In 2001 and 2005, BP made it onto Mother Jones' Top 10 Worst Corporations list. The magazine cited the company's "shoddy operations" in Alaska (the following year, one of its pipelines burst, spilling oil onto the tundra) and a 2005 explosion at BP's Texas refinery in Texas City that killed 15 workers and injured more than 100.

After the Texas City explosion, investigators "later determined that the company had ignored its own protocols on operating the tower, which was filled with gasoline, and that a warning system had been disabled," reported ProPublica. And in 2009, the Occupational Safety and Health Administration fined BP $87 million for failing to correct safety hazards revealed by the tragedy.

Citing this record -- as well as the company's decision to slash its investment in renewable energy by 30 percent last year -- BP was nominated for the 2009 Climate Greenwash Award, announced annually in Copenhagen, Denmark. (It lost out to a Swedish energy company, Vatenfall, which was cited for "its mastery of spin on climate change, portraying itself as a climate champion while lobbying to continue business as usual, using coal, nuclear power and pseudo-solutions such as agro-fuels and carbon capture and storage.")

Last week's spill would seem to make BP the clear favorite for this dubious award for 2010. The explosion, believed to have killed 11 workers, could wind up spilling more oil than the Exxon Valdez tanker did in 1989. While containment and cleanup costs could reach $3 billion, BP's insurers likely will be stuck with the tab.

Tony Hayward, who heads BP, recently said to fellow executives, "What the hell did we do to deserve this?" It's a question for which BP's critics would offer up many ready answers.