The Buck Never Stops
Halliburton Profiting on Gulf Spill Cleanup
How’s this for a business model? First, you make a bundle of cash by providing essential services to the oil majors as they undertake tricky (and risky) offshore oil and gas extraction. Then, when one of the wells you’re working on blows up, you sneak away from any possible liabilities. And finally, to bring everything full circle, you then rack up additional profits with your oil spill cleanup division.
That pretty well describes Halliburton’s masterful playing of the BP oil disaster. The preliminary investigations into the causes of the Deepwater Horizon blowout show that Halliburton’s job in the cementing work on the well may have led to the gas leakage that ignited the explosion and sinking of the drilling rig. Yet when Halliburton executives appeared before a congressional committee in May, they sought to direct the blame at BP and Transocean. Seeking to deflect attention from itself, Halliburton’s Tim Probert told members of Congress: "We understand that the drilling contractor . . . proceeded to displace the riser with seawater prior to the planned placement of the final cement plug."
Even as Halliburton has slipped out the spotlight, the company is working behind the scenes on the repair effort — and making a buck in the process. (Hat tip to Daniel Tencer at The Raw Story for bringing this story to my attention.)
A week before the Deepwater Horizon accident, Halliburton purchased Boots & Coots, a $191 million company that specializes in “prevention and risk-control services for oil- and gas-well fires and blowouts,” according to an April 12 story in Daily Finance. The company also “helps enhance production for oil and gas operators,” and will likely see an increase in operations as more activity is focused on unconventional, difficult to extract fossil fuel sources like shale oil and gas.
According to The Christian Science Monitor, Boots & Coots is now under contract with BP to help with the relief well that will, hopefully, put a final cap on the blowout. Halliburton is essentially making money from causing the accident and then helping to repair it.
Halliburton’s many-fingered tentacles is just the latest illustration of how powerful the company is. The $18 billion-corporation is the second largest oil services business in the world, making it an indispensable part of the extraction industry. Its long reach brings to mind Rolling Stone writer Matt Taibbi’s evocative description of Goldman Sachs. Like the powerful investment banking firm, Halliburton is also “a great vampire squid wrapped around the face of humanity.”