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COST BENEFIT ANALYSIS OF OFFSHORE DRILLING BY COLSON MYERS
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OIL IN THE ECONOMY In 2010, nearly $476 billion were contributed to the U.S. economy from the oil and natural gas industry. In 2011, close to 32 billion barrels of oil or natural gas were used worldwide. --around 89 million barrels a day.
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OFFSHORE DRILLING By 2018, the offshore drilling industry is projected to be worth $121.1 billion. Last year, there were 821 functional offshore oil rigs in the world. Offshore drilling in the Gulf of Mexico accounts for around 17% of total U.S. crude oil production.
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TOP OIL PRODUCING COMPANIES 1.Saudi Aramco 2.Gazprom 3.National Iranian Oil Co. 4.ExxonMobil 5.PetroChina 6.BP 7.Royal Dutch Shell 8.Pemex 9.Chevron 10.Kuwait Petroleum
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EXXON VALDEZ March 23, 1989 Spilled over 11 million gallons of oil Contaminated around 1300 miles of Alaskan shoreline Total cost of spill around $7 billion --cleanup alone was just $2.5 billion
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EXXON’S PROFIT/COST OF THE SPILL In 1989, Exxon made a $3.8 billion profit and a $5 billion profit the next year. A 2008 Supreme Court ruling required Exxon to only pay $507.5 million. --As of 2009 they have only paid $383 million.
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EFFECT’S OF THE EXXON SPILL As of 2009, 16,000 gallons of oil still remain. In 2001, almost 20 acres of shoreline were still contaminated Only 8% of oil was actually recovered from the spill.
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COST BENEFIT ANALYSIS OF SPILL
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BP EVENT HORIZON SPILL Happened April 20, 2010. 11 people were killed 210 million gallons of oil 16000 miles of coastline affected
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COST OF CLEAN UP AND FINES Under the Clean Water Act --$1100 per barrel This was raised to $4600 due to negligence This amounted to $16 billion on top of the $40 billion BP owed for clean up and settlements.
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BP LOSS AND FINES SO FAR Set aside $43 billion for spill BP has paid around $32 billion so far Still owed the government $4.5 billion over the years 2010-2015.
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BP PROFIT (SPILL TILL NOW)
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EFFECT OF THE BP SPILL Left oil spill on the gulf seafloor After six months, over 8000 marine animals were found injured or dead.
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LONG TERM EFFECTS OF THE SPILLS Decreased Fish and Wildlife Populations Decline in Recreation Unbalanced Food Web.
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VISUAL COMPARISON OF THE TWO SPILLS
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COMPARISON OF THE TWO SPILLS Exxon ended up being responsible for around $46.14 per gallon spilled. BP ended up being responsible for around $266.67 per gallon spilled.
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REFERENCES http://www.energytomorrow.org/ http://www.iea.org/ http://www.noia.org/ http://www.ihs.com/index.aspx http://www.eia.gov/ http://www.forbes.com/fdc/welcome_mjx.shtml https://www.americanprogress.org/ www.cnn.com http://www.education.noaa.gov/ http://oceana.org/en http://www.marketwatch.com/investing/stock/bp/financials
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