Company Earnings May be Strong, but Fears Overwhelm Positives
While BP announced better than expected earnings in the First Quarter 2010, the news did not stop investors from unloading its stock. Showing similar financial concern and investor worry, S&P Equity Research on Monday cut its rating on Transocean (RIG) to hold from strong buy, based on valuation.
The recent Transocean Deepwater Horizon oil rig explosion highlights the risks and dangers associated with oil exploration and drilling. Also, the high price of cleaning up an environmental disaster, plus the costs associated with rebuilding the company's reputation if such a disaster hits, would have long-term negative effects on the company's profits and revenues.
As reported by the Houston Chronicle, 509 blazes have hit rigs since 2006. Several of these fires occurred on Transocean oil rigs resulting in serious injuries to Transocean workers that required evacuation and caused millions in damage.
Kurt Arnold, who has represented several clients in recent cases against Transocean Offshore and specializes in maritime injury cases said “Unfortunately, the rise of incidents offshore are increasing as the exploration for oil and gas increases,” Arnold said. “Many companies talk about their safety record, but the majority of accidents are not reported or misclassified. Unlike on land, there is little oversight.”
Efforts to seal the damaged well continue, as families and communities work together to begin the healing process of their own.
For More Information:
http://www.GulfCoastMaritime.com
http://www.Twitter.com/MaritimeInjury
Fortunately, there were no injuries on board the Gilchrist. Fires on a water craft are often linked to explosions; the fire on the Gilchrist appears to have ignited in the engine. This can happen due to improper maintenance of the fuel system. Fires can also break out due to electrocution, when the vessel comes in contact with a live power line.