BP’s results stir mixed emotions along Gulf Coast
Even with spill costs, oil firm earns $1.79b
BILOXI, Miss. — BP PLC is once again reporting a profit even with an estimated $40 billion price tag for the response to its blown out well in the Gulf of Mexico.
In this waterfront city, where many lost their livelihoods to the summer of oil, a mixture of relief and melancholy greeted the news yesterday. A financially healthy BP means jobs and compensation, but residents still reeling from the worst offshore oil spill in US history are waiting for some good news of their own.
BP said that costs related to the April 20 oil spill dragged down its third-quarter profit by more than 60 percent. The London company earned $1.79 billion from July through September, compared with $5.3 billion a year earlier. But the fact that BP returned to profits at all, coming after a loss of $17.2 billion in the second quarter, indicated the company’s operations remain solid despite the spill.
“That’s real good news they’re making money because at least we know they have the ability to pay us over a long period of time because we’ve still got a lot of problems,’’ said shrimp processor Rudy Lesso, whose Biloxi business is down about 25 percent because much of the public is still afraid to eat Gulf seafood.
BP has set up a $20 billion compensation fund to pay victims of the oil spill, cutting roughly $1.7 billion in checks so far. But the process has been slow and cumbersome for struggling Gulf coast residents.
All the other major oil companies, except Chevron, have reported stronger third quarter profits thanks to higher oil and gas prices.
The company’s $40 billion estimate for its overall spill response was $7.7 billion higher than its previous estimate provided during its second-quarter results released this summer, largely due to unanticipated additional expenses. The company had already spent $11.2 billion responding to the spill by the end of September.
None of that, however, kept BP chief executive Bob Dudley from delivering a rosy prognosis.
“Putting aside the incident . . . the BP group as a whole delivered a strong business performance throughout the quarter in terms of both financial and safety performance,’’ he added.
Ewell Smith, head of the Louisiana Seafood Promotion and Marketing Board, said people forget that oil and fishing have for decades “worked side by side’’ in the Gulf region.
“People lose sight that our fishing communities and our oil and gas communities are tied together at the hip,’’ he said.