Campaigner Vicky Wyatt with the papers for the legal challenge
Ben Ayliffe, one of our climate campaigners, writes about the reasons behind the legal case:
Former BP boss Tony Hawyard's recent mea culpa over Deepwater Horizon reminded me of an interview he gave to the company's in-house magazine in 2008. Hayward, it was claimed, "has the advantages of a scientist's clarity of mind, combined with a lifelong BP man's human understanding," the eulogy concluding that BP "is in good hands." Whilst the Gulf of Mexico disaster went on to illustrate the price of such hubris, Hayward's admission that the catastrophe was one "that all our corporate deliberations had told us simply could not happen" raises questions about how government and investors assess the risks of unconventional oil.
Until recently BP was the darling of the FTSE. But the explosion that ripped through the Deepwater Horizon changed all that. BP posted enormous losses after the disaster and now faces a $40bn bill. Few at the time seemed aware of the risk of something going so spectacularly wrong. Until the Gulf of Mexico, BP was happily telling investors that unconventional oil projects were the future. And investors believed it. In hindsight this seems remarkable. Hayward admits the oil industry was entirely unable to cap a leak at such depths because the necessary equipment "simply did not exist".
But why didn't investors responsible for safeguarding the billions of pounds we have in our savings and pensions bother to properly scrutinise the business risks? Of course, there were some who had doubts, but most in the Square Mile lapped up whatever BP told them. And paid the price.
What of the government? It said the disaster had given it "pause for thought" but remained confident that the regulatory regime was robust. So robust that it has now allowed oil companies to start new drilling in deep water off Shetland. But the UK's position on new oil is just as reckless as those investors who bought into BP.
Why? Firstly because the official report into the cause of the Gulf of Mexico spill won't be published until 2011. Because no one knows what exactly caused the explosion it follows that no one knows what the risk is of it happening again elsewhere. This makes a decision on whether the risks of new drilling in the UK are justified impossible.
Secondly the government has admitted that one of the mysteries of Deepwater Horizon "appears to be the fact that the blow-out preventer was checked within two weeks of the disaster and still failed." We are in a position where inspectors will try to ensure the safety of rigs even though similar inspections failed to prevent Deepwater Horizon.
The government claims all this is not a problem because it will "be vigilant". But such Churchillian bluster is not enough when it relies on laughable safety claims from oil companies. For instance, Chevron said that a spill in the UK would not affect whales and dolphins because "given their good swimming abilities, relative intelligence and nomadic behaviour, some avoidance could be expected". This was deemed acceptable evidence to green light drilling off Shetland.
This attitude is precisely why Greenpeace has launched a legal challenge against the government. To carry on issuing licenses despite not knowing what caused Deepwater Horizon is irrational and illegal.
BP said Deepwater would never happen. Not only did it happen, but once the oil started gushing the company didn't have technology to stop it before things spiralled out of control. Unsurprisingly, it never told investors this. They believed BP and lost out.
Now government is making the same mistake, believing big oil's spin, providing light touch regulation and showing blind faith that it'll be alright on the night. This won't cut the mustard when our environment and a clean energy future is at stake. And certainly not when, as Denis Norden once said, "there's an unseen force which lets birds know when you've just washed your car".
Continued investment in unconventional fuels like deep water drilling, tar sands and the Arctic cannot continue. Reducing demand is now a fact of life. New regulation on fuel standards, efficiency measures and electric vehicles are fast approaching.
Our legal intervention, we hope, will help make this change a reality by creating space for investment to shift from oil to clean solutions. This won't happen overnight but we have to make a start.
