ANCHORAGE, AK: BP has more than doubled the number of external communications people working in its Anchorage, AK, crisis-response unit in light of its announcement August 7 that it would cease more than half its production in Prudhoe Bay - the largest oil field in the US - because of severe pipe corrosion and a "small" oil spill.
The company's image is taking a battering because advocacy groups are wondering how such an "eco-friendly" company let something like this happen under its watch.
Since 1999, when BP worked with Ogilvy PR to rebrand its US subsidiaries by abandoning the name British Petroleum, along with the shield logo, it has worked to build equity and trust with consumers and activists. Neil Chapman, press officer at BP, said it realizes this current situation is having an adverse effect on those efforts.
"It's clearly impacting our reputation, and we're well aware of that, and we regret what's happened, and we've apologized," Chapman said. "All we can do is focus on making sure everything is put right that we've got to put right and that we focus on going forward and providing our customers with the energy supplies they need."
Tyson Slocum, director of Public Citizen's energy practice, agreed that BP's green image would be negatively affected by the news.
"The bigger issue here is that BP has huge and mounting problems," Slocum said, adding that a previous pipeline spill was what led the company to notice this problem.
"[BP's] reaction to all of the news, and the fight over gas prices this summer, is to just spend more money on PR," said Mark Cooper, research director for the Consumer Federation of America. "BP has visible operational problems."
Once BP realized that it had to halt production at the field, it immediately contacted local, state, and federal regulators, stakeholders, senior politicians, and Secretary of Energy Samuel Bodman.
"Our DC office made the proper notifications as well," Chapman said. "Basically we told them what our plans are and what we'll be announcing publicly."
The oil company moved Anchorage press office operations to its crisis-response unit and added six communications people to the four it normally has working in that office.
BP set up a dedicated Web site, usresponse.bp.com, on Monday that provides updates, photographs, explanatory diagrams, and background information for the media, consumers, and stakeholders. Chapman said since the news broke, there's been a consistent stream of media requests on all geographic levels.
"Media calls started coming in as soon as we issued something publicly," he said. "If you're going to be impacting [oil] supply or potentially impacting it, then it's something that could have an impact on markets. We [had] to prepare for what they're going to say."
BP America president Bob Malone and Steve Marshall, president of BP Exploration Alaska, have done interviews on a number of national networks, including CNN, NBC, and PBS.
BP also took a pool of about 25 television and print journalists to the scene of the spill and pipelines this week. Chapman said contacting employees via e-mail and an internal intranet site is also a part of the communications process.
A press release was issued on August 7 detailing how the company was made aware of the problem and how it would address it. A statement from Malone was released the following day.
"It's important people see evidence that we're in action and doing what we say we're doing," he said.
He added that while Ogilvy is assisting BP during this situation, the company has elected to do the majority of work on its own. "Most of it is being handled in-house by us... unfortunately, we have real experience in dealing with incidents and emergencies and crises," Chapman said.
In March 2005, BP's crisis communications team went to work after an explosion at a Texas oil refinery killed 15 workers and injured 170 others.
"We've been apologizing for what we had to do and trying to explain why we had to do it for both safety and environmental reasons," Chapman said. "It's not comfortable and it's not something we wanted to do, but it's something we recognized we had to do as part of the environmental protection. It's not news we like giving and it's not news people like to receive but we're trying to explain what we're doing."
The Prudhoe Bay oil field, representing 7.5% of US oil production and about 2% of domestic consumption, is responsible for 400,000 barrels a day. Even though prices have not risen drastically, experts are predicting a great spike in costs on the West Coast, owing specifically to the BP crisis.
"In general, the market is working, and we'll be making further supply purchases, and we don't anticipate any immediate crude or product disruption in BP US West Coast operations," Chapman said. "These are absolutely the messages we're trying to convey in our communications effort."