Svanberg defends BP over Gulf oil spill

BP has emerged as a safer company from last year's massive Gulf of Mexico oil spill, chairman Carl-Henric Svanberg insisted Tuesday, defending the British company's widely-criticised handling of the crisis.

Svanberg defends BP over Gulf oil spill

Svanberg had been BP’s chairman for only a few months when a massive explosion on April 20, 2010 rocked the Gulf of Mexico Deepwater Horizon rig leased by the British energy giant.

The blast killed 11 people and sent some 4.9 million barrels of oil gushing into the Gulf over a three-month period, wreaking havoc on the region’s environment and economy.

A year after the blast, Svanberg told media in his native Sweden BP had learned its lessons and taken steps to become a safer company.

“But we weren’t unsafe before either — 50,000 holes had been drilled in the Gulf of Mexico before it happened,” he insisted in an interview with business daily Dagens Industri (DI).

“The whole industry has learned from the accident and we are doing everything to ensure that it doesn’t happen again.”

Svanberg was criticised for his low profile in the crucial weeks after the spill — Britain’s Independent newspaper called him “the invisible man” while a Swedish daily referred to his “ostrich tactics.”

He said in two interviews published Tuesday that at the time he had deemed it was chief executive Tony Hayward’s role to step forward and explain the company’s position.

In the end though, “the problem wasn’t that I was out too little, the problem was most probably that Tony was out too much. He became over exposed,” he told the Svenska Dagbladet daily (SvD).

“We on the board did not take the initiative until we realised that the last attempt to plug (the ruptured oil well) at the end of May would fail, when it became clear that the accident would hurt us economically and politically,” he told DI.

Svanberg was then thrust into the limelight when he was summoned to a meeting with US President Obama at the beginning of June.

He insisted to SvD he had not been “called in,” stressing BP had fought to obtain the meeting, which he called a “turning point.”

But it was also the stage of one of Svanberg’s major hostages to fortune — on the White House lawn on June 10th, he said BP “cared about the small people.”

“That became a much bigger deal in Sweden than in England or the United States. It is clear that was unfortunate,” he said.

Svanberg still has the support of BP shareholders, 92 percent of whom voted to re-elect the Swede to serve as the company’s chair for another year, the BBC reported on Monday.

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Could the Norwegian government introduce a cap on energy prices? 

Due to soaring prices, the Norwegian government is mulling over several solutions, including a potential price cap for electricity and limiting energy exports abroad. 

Could the Norwegian government introduce a cap on energy prices? 

High energy exports in the last 12 months, low filling levels in Norwegian reservoirs and an uncertain energy situation around Europe have led to soaring electricity prices in southern Norway. 

Last year the government introduced a scheme whereby it covers 80 percent of consumers’ energy bills where the price rose above 70 øre/kWh. The portion of the bill under 70 øre is paid in full by households. The portion the government covers will increase to 90 percent in October. 

Critics have argued that the current scheme still leaves households struggling with their bills. As a result, Norway’s government has said it is mulling its options to curb energy bills.

Norway primarily depends on hydroelectric dams to help it meet its energy needs. Still, reservoirs in southern Norway have been at the lowest level for ten years, public broadcaster NRK reports. 

Low reservoir filling over the past year has conceded with record exports with higher prices on the continent, making sending power abroad an enticing proposition.

Recently, exports have fallen significantly, and the government is considering introducing a limit to reduce the possibility of energy rationing being introduced this winter. 

“Restrictions on the export of electricity to Europe may be one of the measures that is needed,” Elisabeth Sæther, state secretary at the Ministry of Oil and Energy, told NRK. 

Earlier this week, Prime Minister Jonas Gahr Støre ruled out completely shutting off exports to the continent. 

“It is a dangerous thought and will not serve us well. It could give us more expensive power and lack of power in given situations. We will hardly be able to import power when we need it without contributing to other countries when they need it. There is a reciprocity in this,” he told the newspaper Aftenposten earlier in the week. 

Sæther also told NRK that the government was weighing up putting a maximum price on energy but warned that it could have unforeseen consequences. 

“We are afraid that a maximum price means that more water is drawn into the reservoirs, which we need for the winter. It is a serious situation. We must prevent ourselves from getting into a situation where we lack enough power this winter,” she told the broadcaster. 

At the end of May, the state-owned Statnett announced that the supply situation in Norway might be under strain – in some scenarios – all the way up to and through the winter, especially if Southern Norway experiences drier than usual weather in the second part of the year.