Oil spill economics: Mapping BP's potential liability

If you want visualize just how large British Petroleum's liability exposure could be from the Gulf oil spill, just look at this Oil Spill Economic Impact map.

Oil Spill Economic Impact

This map, developed by ESRI using its geographic information systems (GIS) software, shows an up-to-date map of the Gulf coast, along with overlays showing the current size and location of the oil plume and the exact economic value for tourism, fishing and boating business for every county potentially in harm's way. Economic activity is already being negatively affected in some counties.

BP has said that it will cover all legitimate claims resulting from the spill. But can it handle a worst case scenario? BP is already spending millions to control the spill, but reparations for economic damage could run into many billions of dollars.

On the income side, BP certainly has the resources to handle a sizable number of claims. The oil company had income last year of $63.4 billion. The total market value of the company currently sits at $142 billion.

Now let's look at the liability risk, starting with just one county.

In Harrison county, MS, due north of the spill, the total economic activity at risk is in excess of $1.4 billion. In the just the six counties closest to the oil spill the potential economic activity imperiled by the spill comes to $4.9 billion.

But there are more than 50 counties potentially in harm's way, from the Florida Keys to the coast of Texas - and that's not counting the exposure BP would incur if the oil flows around the Keys and up the East Coast by way of Gulf stream currents.

With tar balls showing up now on the Florida keys, that's a possibility that can't be discounted.

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