20K, over/under

Any way you look at it, the oil mess in the Gulf is ugly. It is going to be extremely difficult and expensive to clean. It’s going to hammer a lot of industries — and not just the fishing industry — that rely on the Gulf for existence.

And a little fact presently under discussion is going to have massive impact on all of this. The question is simple: did BP drill past 20,000 feet?

Their license is only good to 20,211 feet. Their official statements have said they weren’t there yet — that they were at 18,360. However, some workers have said they were much deeper than 20,000.

Expect a lot of discussion on this. It is quite literally a lifethreatening question for the company.

See, as long as BP stayed above 20,211 feet their liability is capped. Oh, they’ll contribute to the clean up, but the majority of the cost will be paid by taxpayers. But if BP crossed the line, they suddenly become 100% liable for damages.

Not just cleanup damages, but damages to businesses such as the gulf fishing industry and tourism and a host of other such businesses. The total cost could put BP out of business by the time it’s done.

With so much at stake, BP will not be gentle in working to deny it regardless of whether they’re innocent or guilty of the charge. Don’t be surprised to see more on this in the upcoming months.

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