BP's Openness Fails to Quell Sea Drilling Backlash in Congress
Florida Democrat Bill Nelson said the first time he received a visit from a top BP Plc executive in his decade as a U.S. senator was May 4, when Chief Executive Officer Tony Hayward came to discuss the oil spill in the Gulf of Mexico.
Nelson, an opponent of offshore drilling, said while he appreciated the gesture, he still supports legislation that would raise the cap on London-based BP’s economic liability for the spill to $10 billion from $75 million.
“I’m satisfied that he came and talked to us,” said Nelson, after the meeting in his Senate office. “But naturally I’m not satisfied at all that there are people who still want to go out and take the risk by drilling.”
Hayward’s visit was part of a two-day blitz to show that BP is committed to cooperating with officials. By reaching out to critics such as Nelson, the company and its industry allies are demonstrating they have learned a lesson from Toyota Motor Corp. and Goldman Sachs Group Inc., whose executives were hauled in by Congress this year to be publicly lambasted by lawmakers.
In Toyota’s case, the Japanese carmaker’s president, Akio Toyoda, was criticized for planning to send a subordinate to testify before a House committee investigating faulty acceleration on some of its cars. Toyoda later reversed the decision.
Current and former Goldman Sachs executives, including Chief Executive Officer Lloyd Blankfein, endured almost 11 hours of questioning last month on the New York-based firm’s mortgage business by the Senate’s Permanent Subcommittee on Investigations. The panel also released e-mails that showed employees disparaging securities created by the firm with an expletive and referring to them as “junk.”
For now, BP’s efforts haven’t prevented lawmakers of both parties from saying a March 31 proposal from the White House to expand offshore drilling is all but dead.
Also, at least five congressional panels plan to hold hearings. Tomorrow, Lamar McKay, chairman of BP America Inc., will answer questions from the Senate Energy and Natural Resources Committee and the environment and public works panel.
BP’s accessibility may help limit the damage to its reputation and win some support from Congress, said Dale Curtis, a former congressional aide who now runs a public- relations firm in Washington.
“It is absolutely in BP’s interest to be as open and forthcoming as possible,” said Curtis, who advised Tyco International Ltd., whose former CEO, Dennis Kozlowski, was convicted in 2005 of stealing from the company. “Like Toyota, BP has already suffered massive damage to its reputation. Its only hope of surviving and regaining any amount of trust is being absolutely truthful and accessible.”
Robert Wine, a BP spokesman, said “being available to the regulators and others at local, state and federal level is an important feature of the response” to the spill.
BP’s responsiveness has attracted notice.
“It seems like almost on a daily basis somebody has sort of checked in or called or come by the office providing information, being available to answer questions,” Senator Thad Cochran, a Mississippi Republican, said May 5.
Still, Representative Joe Barton of Texas, the top Republican on the House Energy and Commerce Committee, and an industry ally in the past, said it may not be enough to ease calls for stricter regulation.
“I’m not satisfied with the answers,” he said after meeting with company executives May 4. “Those of us that support offshore drilling have to be open to the possibility that we have to toughen up a bit.”
While BP focused on its image, much of the legislative lobbying -- on opposition to new regulations or banning future offshore drilling -- has been handled by industry groups such as the American Petroleum Institute.
The oil company has built ties on Capitol Hill. In the first three months of the year, according to the Washington- based Center for Responsive Politics, the company spent $3.5 million on lobbying, behind only Houston-based ConocoPhillips, which spent $6.4 million. BP’s lobbyists include former Texas Democratic Representative Jim Turner and former White House Chief of Staff Kenneth Duberstein.
API has established two task forces to help investigate the oil spill, one to look at equipment and the other at best practices for deepwater drilling, said Jack Gerard, president of the Washington-based trade group.
Search for Causes
Gerard said industry officials are asking lawmakers to delay action on regulation and measures such as increasing the liability cap until the causes of the explosion at the Deepwater Horizon rig have been determined.
“We still don’t have the answers,” Gerard said.
Acting on a separate front, Hayward met with the six senators from Mississippi, Louisiana and Florida. Other BP officials gave House lawmakers and staff a briefing behind closed doors.
Lawmakers are “impressed with the level of cooperation,” Democratic Representative Edward Markey of Massachusetts, a member of the energy panel, said while touring the Gulf region May 7. “There will still have to be an assessment made about the responsibility for what went wrong.”
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