Management Under Uncertainity Assignment 2022

RUNNING HEAD: MANAGEMENT UNDER UNCERTAINITY
0
BP Whiting Refinery
Management under uncertainty
Report
Student Name
[Pick the date]

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Contents
Introduction......................................................................................................................................2
Problem identification.....................................................................................................................3
Cause and effect analysis.................................................................................................................4
Root causes......................................................................................................................................5
Solutions and recommendations......................................................................................................6
Conclusion.......................................................................................................................................7
Bibliography....................................................................................................................................9

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Introduction
British Petroleum multinational oil and Gas Company and its headquarters located in the
London and United Kingdom. BP petroleum is the sixth-largest oil and gas company on the
global level. The major working of the company is to exploration, production, petrochemicals,
power generation, and distribution or marketing. The company also engaged in renewable
sources such as wind power, biofuels, and solar technology. The major controversial arises in
2006, was in Alaska its “unacceptable neglect of pipeline that forced the company to shut down
its operations in the Prudhoe Bay. In 2007, the company was charged $373M by the US
Department of Justice for committing the environment fraud (British Petroleum, 2019).
The following case study analysis examines the BP environmental degradation of Lake
Michigan and its 2007 expansion plan. Furthermore, there is a discussion of problem
identification, which states that BP violated the limits suggested by the IDEM (Indiana
Department of Environmental Management (Muralidharan, 2011). There is a brief discussion
about the cause and effect analysis of the company’s case study under which reasons of
environmental fraud by the company. The root causes of the company put drainage in the lake
the toxic waste material such as mercury and ammonia increasing day-by-day that disturbing the
company’s local operations. The expansion project provides more sustainability to the business.
In the end, there is a recommendation and solutions to the company, which includes, economic
instruments, BP can check the amount of toxic waste material and better results of NO, Sodium
and other toxic waste material.

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Problem identification
BP petroleum, the whitening refinery in 2006 entered into the agreement with the
Indiana Department of Environmental Management (IDEM) to expand its operations in the
refinery industry. In 2007, BP formally applied to the IDEM for the discharge of waste material
and storm or cool water in Lake Michigan. The company submits its formal application to the
environmental regulatory agency (Colborn, 2011). The company with the United States sets a
common legal process. BP filed an application within 60 days to the environmental agencies for
the comment and for the approval process. The approval process suggests that if no response
were received in 60 days from the respective authority to which application is filed then the
application would become legally effective. BP satisfied the environmental authorities that the
company’s action would not harm the environment and local citizens. After the BP clarification,
IDEM and the government approved the application of BP. The company discharged five-time
more industrial waste into Lake Michigan IDEM and environmental authorities only allowed
5694 pounds of waste in the lake but the company discharged 26,621 pounds, which five times
more from the limit (Ligarski, 2012).
Many citizens and people protested against the action of BP petroleum because the
amount of mercury presented in the waste material that can affect the health of the people. After
battling, the protested company tried to remove mercury from the lake. BP also produces the bye
product of black and powdery. BP declares that it employs 19000 people in Indiana that the
supplies hundreds of retail stations. This activity of BP petroleum affects the goodwill of a
company in the oil and gas industry. The toxic mercury waste material reflects negative impacts
on the fish and people nearby (Flamme, 2013).
BP planning to expand the Whiting refinery to produce and finding the natural resources
for on which market depends. In the operation of expansion, the company’s executives
confronted competitive environment from the gulf countries. The problems faced by the BP in
the expansion are local expertise and indigenous technology, which means higher operating
expenses and cost of technical expertise (Hawthrone, 2017). Gulf countries are not supporting
British Petroleum it creates a complex environment for the company. Expansion of refineries in

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the developed countries leads to high operating costs. The British Petroleum expansion plan
includes Canadian crude oil and enhancing gasoline production as a fourth-largest refinery in the
US. The problem arises in the expansion of British petroleum struggling to boost the production
targets and downfall in the prices of crude oil from $70 to $50 (Hansen, 2010).
Cause and effect analysis
British petroleum and it's executive’s planning expand its working operations on the
banks of Lake Michigan. The cause behind the company expanding its operations is increasing in
the demands of gasoline. Increased population is the reason for expansion in the operations. The
major executives of the company ensure the growing demand for sustainable. The company
entered into the partnership with the Russian state-run oil company to expand the operations in a
growing company (Meyers, 2010). In the expansion, Operations Company collaborated with the
Tunisia, Egypt, and Libya, In order to avoid the political risks from the market and government.
The major cause to expand the company’s operations is the activity of Lake Michigan, which
affects the goodwill of the company. Many people protested against the decision of British
Petroleum and filed a petition against the company (Shadmanpoor, 2017).
The cause of British petroleum is the environmental degradation of the company is
increased waste material in the company. BP executives are responsible if in case of any failure
and loss from the global expansion (Henderson , 2014). The expansion of BP to refine the crude
oil brings sustainability in the management that boost the gasoline production of the company.
BP no longer required depends on Middle Eastern oil. The cause of expansion is that the
amounts of waste material throw by the company into Lake Michigan and profit from the
expansion helps the company to remove ammonia from the lake (Hawthrone, 2017). The
discharged material was including toxic heavy metals such as lead, nickel and majorly mercury.
Lake Michigan is a source of drinking water of huge people in the south that company polluted
with toxic heavy materials. The major reason company invests $3.8 billion in its expansion the
increased demand for oil and CXHO (Canadian Extra Crude Oil). The effect of BP expansion is
the $3.8 billion it helps to meet the demand of the gasoline in the Midwest and provide 2000
temporary jobs to the citizens (Hertsgaard , 2013).

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Root causes
British Petroleum additional discharge in Lake Michigan cause environmental fraud that
affects the four million residents. The company discharged five-time more industrial waste into
Lake Michigan IDEM and environmental authorities only allowed 5694 pounds of waste in the
lake but the company discharged 26,621 pounds, which five times more from the limit. The
company filed permission with the environmental authorities to discharge the waste material into
the lake. IDEM (Indiana department of environmental management) allows the company that it
will not affect the habitat around the lake (Joseph , 2016). The company performs this activity
because continuously increasing waste of toxic materials in the organization. Many local citizens
did protest against the company and filed a petition against the company. The company enters
into the overseas expansion is to improve the goodwill of the company in front of the citizens.
The company takes steps to remove the toxic waste material from the lake such as Lake
Michigan but still, there are some floating solids on the surface of the lake. After the clear
operation, the company shows the quality of the lake to the environmental groups but still the
ammonia and suspended soils are presented in the lake. IDEM permits the BP through the waste
material in the lake with the opinion that harm was not excessive but local citizens take protest
against the company. There were 500 gallons of crude oil dumped into the lake that tarnished the
reputation of the company. After the two years on BP for the environmental fraud company
ready to bid again on the new federal drilling leases (Kadafa , 2012).
BP petroleum by the environmental degradation polluted the air and gets help from the
USEPA by $400 million investment to remove the toxic from the lake and to help actually
reduce the pollution they emitted. The federal government against the put the mercury discharges
into the Lake Michigan of British Petroleum. The environmental companies in 2012 apply the
federal limits on mercury discharges into the lake (Ligarski, 2012). BP’s annual discharge of
waste material should be reduced to 8/100 of a pound. Company investing money to remove the
ammonia from the water as it affects the health of people. British petroleum sought an expansion
project that enables the company to manufacture the heavier Canadian crude oil. Through the
expansion, the company no longer required to depend on the Middle East and open the way for
more opportunities. The reason the company put drainage in the lake the toxic waste material

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such as mercury and ammonia increasing day-by-day that disturbing the company’s local
operations. The expansion project provides more sustainability to the business. Though before
dumping the waste material companies takes prior permission from the environmental groups
and complies with the clean water act and assures the full protection of the lake but company
violates the limit that suggested by the IDEM ( Indiana Department of Environmental
Management) (Ligarski, 2012).
Solutions and recommendations
The BP sustainability policies improve the people lives through the advancing energy and
provide the energy products or services around the people to comply with the environmental
rules and regulations. The sustainability policies of British Petroleum are to support economic
growth and improve the quality of operations and should maintain the safety of workers.
Environment policies must be review every year by the company to comply with the
environmental rules and regulations (Witter, 2014). The economic and social decisions must take
to improve the integration of environmental concerns. The international environmental
cooperation must adopt by the company to improve environmental issues. It is recommended to
the company to give importance to the environmental objectives and should find ways to
mitigate the pollution. The company must adopt long-term environmental objectives to enclose
the implementation gap. The management for abatement and natural protection must perform the
supervision of the environmental policies and legislation (Meyers, 2010).
The company should use economic instruments for the management of environments
such as tradeable permits and green taxation. Through the economic instruments, BP can check
the amount of toxic waste material and better results of NO, Sodium and other toxic waste
material. The company must evaluate the environmental and social implications on a regular
basis. The company must provide environmental information and economic analysis to sustain
the environmental policy departments, energy prices, and environmental expenditure ( Seba,
2014). The recommendations in relation to the waste material of British petroleum, that company
must decouple the waste generation and put regular efforts into it. Extended recovery schemes
must implement by the company in its operations. Waste recovery and disposal methods must
use in an efficient manner and use on a regular basis. Planning for the treatment and disposal of

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hazardous waste should be in environmentally manner. The company must aim at remediating
closed landfills in disposing of the material. Sustainable development strategy must for efficient
use of renewable and non-renewable resources. The long-term fiscal policy must use by BP to
measure the sustainable management and transmission of wealth to future generations. The
company must establish the ENOVA (Energy Efficiency Agency) method to implements the
energy efficiency in the residential area and local operations of the company (Shadmanpoor,
2017).
The company must reduce the emissions of pollutants and must achieve environmental
targets. The environmental controversy of Lake Michigan of British Petroleum affected the
refinery industry in huge number. Before dumping the waste material in the lake, the company
should check the amount of toxic waste material such as sodium. The company did not take
permissions from all environmental groups but only takes from the IDEM which against the rules
of the environmental regulations ( Quirmbach, 2015). The company should check the population
around Lake Michigan and should take consent from the local residents in the South. The
company did not consider the consent of citizens that living around the lake and in results
citizens protested against the company and filed a petition for the shutdown of the company’s
operations. The company should not dispose of the waste material in the lake and must adopt the
alternative methods of disposing of. The company must evaluate the environmental and social
implications on a regular basis. The company must provide environmental information and
economic analysis to sustain the environmental policy departments, energy prices, and
environmental expenditure ( Ambisisi, 2014). The recommendations in relation to the waste
material of British petroleum, that company must decouple the waste generation and put regular
efforts into it. British petroleum must implement the methods through proper planning and
controlling. The company must fulfill the due diligence to get prevention from the disputes and
penalty (Muralidharan, 2011).
Conclusion
It is concluded that BP expansion project helps the company to regain its goodwill in the
market and establish the efficient method of disposing of the waste material. Environmental
standards create awareness of national and international environmental issues in the South.

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Waste management in the oil and gas company has strict legislation. Company has limited
sources to implement the waste material disposing of methods. British Petroleum adopts the
many efficient methods to cover the environmental fraud of Lake Michigan and improves its
goodwill in the market. BP is having a great impact on the revenue of the government and
provides various market opportunity and potential jobs. British Petroleum adopts the Economic
Transformation Program to implements sustainable programs. BP environmental legislation
implemented to monitor controls, reduced consumption, and waste generation.

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