Dividends and Oil spill spurs California lawmakers to pursue ban on all US offshore drilling

Shortly after the oil spill off the coast of Orange County, those politicians who do not like offshore drilling made a pleas to ban to ban offshore drilling.

In an article by Jessica Resnick-Ault and Daniel Trotta of Reuters, the good thing the politicians did was to trill to determine what caused the the pipeline to burst. About 3,000 barrels of crude oil spilled into the Pacific Ocean killing wildlife and closing beaches south of Los Angeles. In reality the offshore drilling off LA could be closed because at the moment there are 23 rigs producing 12,000 barrels of oil a day. If you think about the Daniel Day Lewis movie There Will Be Blood, there were hundreds of rigs and California produced more than 200,000 barrels a day.

According to Martyn Willsher CEO of Amplify Energy, the pipeline was moved more than 30 meters from where it should have been. Possibly an anchor move it for the US Coast Guard Captain Rebecca Ore said the pipeline was moved laterally.

Linking to dividend paying stocks, whenever there is an accident, the reason behind it needs to be investigated and hopefully it does not happen again. There is a reality in owning companies that drill in the sea offshore, accidents do happen. What as an investor you need to do is see how the company deals with the accident and inspires confidence that it should not happen again.

There are more questions than answers, till the next time – to raising questions.

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