BP - off the hook ? ...and a BUY ?

Thrugelmir

joeypesci wrote: »

They are 398 at the moment, I wonder if the news will make them rise on Monday. I brought some the other day at 391, my first ever share buy so brought small. Wonder if I should buy more? Its a risk, as if they announce a lose I assume the shares will go down. However, as they've sold off assets to pay for the recovery, it does look like they'll still be looking at profit rather than lose.

What you to need to consider is what type of Company BP will become. Not was. More than likely it will sell of it US retailing operation which only contributed 3% of profit but employed over half BP's workforce. For many years BP has chugged along paying high dividends but not having any clear direction as to the type of business it is. Think that will change with the assets disposals.

joeypesci

Yeah. Shares did go up for me today by 25p but we'll see what happens next. If they announce a profit I assume the shares will go up more.

If they were to merge or get brought out by another company what happens to their shares?

Thrugelmir

joeypesci wrote: »

Yeah. Shares did go up for me today by 25p but we'll see what happens next. If they announce a profit I assume the shares will go up more.

If they were to merge or get brought out by another company what happens to their shares?

No chance of a profit. As results will be bad. BP will take the opportunity to throw the kitchen sink in to clean up the balance sheet. I would hazard a guess of £19 billion to £25 billion loss.

Until the liabilities are established the vultures will pick off the meat rather than go for the whole carcass.

StevieJ

Maybe the damage is not quite as bad as being generally reported.

The FT can always be relied upon to reduce the ennui of getting back to work and they report that the disaster may not be so bad after all. Perhaps I should book my next holiday while the news is still reporting disaster. I select quotes below:
(see link: http://www.ft.com/cms/s/0/1128e072-9804-11df-b218-00144feab4...)

(total spilt).. amounts to 5.4m barrels of oil, as Bobby Jindal, Louisiana governor, noted last week, quoting a US Coast Guard report. This upper estimate is equal to one day’s US crude production.

So where is the oil now? The Financial Times put the question to Doug Suttles, BP’s chief operating officer, when he visited an undersea robot command vessel in the Louisiana oil town of Port Fourchon.

“The oil has gone to a number of places,” he said. “About 1m barrels was collected and a quarter of a million barrels burned. It’s a very light oil, so lots of it evaporated.”

Many scientists agree with this conclusion. “A lot of the oil is being evaporated and broken up. The conditions in the Gulf are favourable to this,” said Simon Boxall of the UK’s National Oceanography Centre at Southampton University.

The Coast Guard broadly agreed, although Mr Jindal noted that still left 1.59m barrels of crude in the Gulf, where it continued to threaten the coastline of Louisiana and its neighbours.

Impact on wildlife

Evidence of the spill’s impact on wildlife has been inconclusive. Although the spectre of oiled brown pelicans enraged the public, the breed – once almost extinct as a result of run-offs of the now banned pesticide DDT – still thrives along the gulf coastline, writes Harvey Morris in Louisiana.

As of July 23, 1,403 birds of all species had been collected visibly oiled, and a third released to the wild after being cleaned. A further 1,149 were found dead and visibly oiled.

The total of oiled sea turtles located, the overwhelming number still alive, amounted to 189. Only one oiled dolphin had been located, according to figures from the fish and wildlife service. Scientists said?they?were?still studying the remains of unoiled animals to determine whether their deaths were related to the spill.

The decision last Thursday by Jane Lubchenco, head of the National Oceanic and Atmospheric Administration (NOAA), to reopen a third of the 80,000 square miles of federal waters previously closed to fishermen reflected a perception of a diminished threat in at least some areas of the gulf.

Mr Suttles noted there had been a dramatic decrease in quantities of surface oil since the leak was capped. Last Wednesday, before tropical storm Bonnie interrupted the clean-up effort, only 56 barrels of oil-water mix were skimmed compared with up to 25,000 barrels a day previously. The Coast Guard report quoted by Mr Jindal said 2.6m barrels of the oil had evaporated or otherwise biodegraded.

......

Some local experts in Louisiana say the wetlands have suffered decades of oil pollution since the industry began there, and that the latest damage to marshland is much less than that already suffered as a result of ill-conceived water-management projects, dredging of oil pipeline canals and hurricanes.

....

Mr Preston said that fisheries in the gulf might end up benefiting from the spill, because overfishing was a worse threat to fish stocks than the oil spill and, in regions where fishing was suspended as a result of the oil spill, stocks had frequently recovered quickly.

http://boards.fool.co.uk/Message.asp?mid=11991464

Thrugelmir

StevieJ wrote: »

Maybe the damage is not quite as bad as being generally reported.

Hazard a guess as to the results ?

StevieJ

Thrugelmir wrote: »

Hazard a guess as to the results ?

I more or less agree with you, a 30 billion provision less profit for the quarter (5 billion) say £25 billion loss.
The analysts are only expecting £8 billion loss, maybe BP will only provide for the Escrow amount (£13-14 billion), I suppose they wouldn't want to show their hand to much on what they truly expect the final bill to be.

The oil firm is expected to roll out the biggest quarterly deficit (£8bn) ever for a UK-listed company after making provisions of between £16bn and £19bn for capping the well, the clean-up and the escrow account to cover damages claims.

http://www.dailymail.co.uk/money/article-1297679/FTSE-hoping-firms-right-results.html?ito=feeds-newsxml

sabretoothtigger

Im not sure the results will move the share price so much as the far bigger question is are they criminally and therefore solely liable or not, this would quadruple the cost most likely

StevieJ

Things definitely looking up for BP and those poor souls on the gulf coast.

About 74 percent of the oil that leaked from BP Plc’s damaged well in the Gulf of Mexico is no longer in the water, according to a U.S. government report.

The report on oil in the Gulf comes as London-based BP reported a “significant milestone” today toward plugging the well permanently. Engineers carried out the “static kill” to inject drilling mud over a period of eight hours yesterday to control the well’s pressure.

http://www.bloomberg.com/news/2010-08-04/u-s-says-74-of-bp-oil-gone-from-gulf-waters-after-worst-accidental-spill.html

Masomnia

I'm only 4% down now

MacsReturns

I'm 39% up

Beginner's luck caught the SP at 302p, but I must admit I've developed an even greater depth of contempt for US politicians and bloggerati in the past month.

Cheers to everyone else who had faith in the darkest hour :beer: