The CASE JournalStakeholders and corporate environmental dec.docx

The CASE Journal
Stakeholders and corporate environmental decision making: The
BP Whiting Refinery controversy
Bryan T. Stinchfield
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Bryan T. Stinchfield , (2009),"Stakeholders and corporate
environmental decision making: The BP Whiting Refinery
controversy",
The CASE Journal, Vol. 6 Iss 1 pp. 5 - 18
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http://dx.doi.org/10.1108/TCJ-06-2009-B002
Bryan T. Stinchfield
Franklin & Marshall
College_______________________________________
INTRODUCTION
During the late summer of 2007, Bob Malone, British Petroleum
(BP) America Chairman
and President, was faced with one of the most important
decisions of his career – to
expand the Whiting Refinery in northwest Indiana on the banks
of Lake Michigan, or to
yield to pressure from the public and not expand operations.
Regional and global
consumer demand for gasoline was rising, which helped push
prices toward record highs,
and the refinery had an opportunity to expand capacity to help
meet that demand.
However, thousands of citizens, a host of environmental groups,
and even national
politicians were opposed to the expansion for fear of increasing
pollution in Lake
Michigan. Malone believed his company followed the letter of
the law when BP received
regulatory approval to proceed as planned. However, public

opposition to the expansion
was fiercer than expected and BP’s environmental image, which
the company highly
valued, came under sharp criticism. As Chairman of BP
America, Bob Malone was
responsible for ensuring that the company achieved high levels
of financial performance
while meeting “the growing demand for sustainable,
environmentally responsible
energy”1
. In light of this, Bob Malone was faced with one of the most
important
decisions of his career: proceed as planned, yield to public
pressure, or some other course
of action.
THE APPROVAL PROCESS
The Whiting Refinery resided about 20 miles southeast of
Chicago, Illinois, and 50 miles
west of the Michigan border. Despite the refinery’s close
proximity to two other states,
BP was legally required to gain regulatory approval from the
state of Indiana only, since
the facility was located entirely within its borders. In the
summer of 2006, BP contacted
Indiana’s environmental regulatory authorities--the Indiana
Department of Environmental
Management (IDEM)--and the U.S. Environmental Protection
Agency (EPA) regarding
its intention to expand operations at the Whiting Refinery. A
few months later, Indiana’s
Governor, Mitch Daniels, publically stated that he appreciated

BP’s selection of Indiana
as the site for BP’s large capital project.
_____________________________________________________
___________________
©2010 by the author and The CASE Journal. Contact the author
at [email protected]
Stakeholders and Corporate Environmental
Decision-making: The BP Whiting Refinery
Controversy
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mailto:[email protected]�
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During the winter of 2007, BP, IDEM, and the EPA reached out
to environmental groups
to discuss BP’s intentions. In March 2007, BP formally applied
to IDEM for a permit

that would be valid for five years to increase the amount of
treated wastewater, storm
water, and cooling water that would be discharged from its
Whiting Refinery into Lake
Michigan2
. By submitting a formal application to an environmental
regulatory agency,
BP set in motion a common legal process within the United
States.
When a company sought to discharge regulated chemicals into
the environment,
environmental agencies were required to review the permit
application, and the general
public was also entitled to review the application and provide
comments to regulatory
officials as to whether they supported or opposed the proposed
action. Under Indiana
law, which was similar to most other states’ laws, the public
had 60 days to comment on
BP’s permit application, and IDEM had a legal requirement to
respond in writing to those
citizens’ comments3
. After the regulatory agency addressed public comments, the
public
had another 18 days to appeal the regulator’s decision regarding
the permit application.
If no appeals were submitted, then the proposed permit
application would become legally
effective.

During the 60-day comment period, Save the Dunes, an Indiana-
based environmental
group opposed to the refinery expansion, sent a letter to IDEM
urging the agency and BP
to gather additional information, exercise prudence, and adhere
to existing statues that
required BP to prove that “no harm” would come to the lake or
surrounding communities
as a result of its proposed actions4
. According to environmental law, the burden of proof
was on the organization seeking the permit to prove that its
actions will not cause
environmental harm. This was the opposite of criminal law,
where the defendant is
innocent until proven guilty. Unlike Save the Dunes and other
environmental groups,
both IDEM and EPA were satisfied with BP’s permit application
that no additional harm
would come to Lake Michigan and surrounding communities as
a result of a proposed
increase in discharge from the refinery.
In late June 2007, IDEM approved BP’s application, and within
a matter of weeks,
citizens, non-governmental organizations (NGOs) and
politicians across the tri-state
region became angered and voiced their opposition to BP’s
intentions and to IDEM’s
approval of the permit. Tens of thousands of signatures were
collected in protest along
the Chicago lakefront, several Illinois politicians threatened a
boycott of BP products,
nationally-elected representatives from Illinois and Michigan
spoke out against the

expansion, citizen groups threatened legal action, and even the
U.S. House of
Representatives passed a resolution urging the EPA to review
the decision. Bob Malone
and BP were completely caught off guard. They had followed
the letter of the law and
even engaged several citizen groups months before they
submitted their permit
application to the environmental regulators. They had spent
millions of dollars branding
their oil company as a good steward of the environment, and
now all that goodwill
seemed to be evaporating before their eyes.
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BP was faced with two potentially opposed realities. They
sought to fill a need in the
marketplace for additional petroleum products, and their

corporate philosophy was one of
open dialogue and engagement with relevant stakeholders5.
The company desired to
satisfy consumer demand and deliver healthy financial returns
to stockholders (see Tables
1 and 2 below), but it also had to weigh the environmental,
political, and economic
consequences of its proposed actions, given that one of the
Whiting Refinery’s top goals
was to “carry on its business in an environmentally responsible
manner…and is
committed to the responsible treatment of the planet’s
resources.”6
Table 1: Selected Financial Information for BP Global
2003 2004 2005 2006
Sales 164,653 192,024 239,792 265,906
Profit before interest and taxation 18,776 25,746
32,182 35,658
Profit for the year 12,618 17,262 22,317 22,601
Capital expenditure and acquisitions 19,623 16,651
14,149 17,231
Capital expenditures only n/a n/a 13,938 16,910
In millions of U.S. dollars
Source: BP 20-F SEC Filing, for year ending 2007,
www.bp.com/liveassets/bp_internet/globalbp/STAGING/global_
assets/downloads/20-F_2007_Form.pdf,
accessed September 2009

Table 2: BP Global Refining Margins ($ per barrel)
$4.50 $4.50
$2.30
$4.11
$6.38
$8.56 $8.49
$0
$2
$4
$6
$8
$10
2000 2001 2002 2003 2004 2005 2006
Ye ar
Source: BP Strategy Presentation, 27 February 2008,
assets/downloads/I/IC_bp_strategy_presen
tation_2008_slides.pdf, accessed September 2009

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lobal_assets/downloads/I/IC_bp_strategy_presentation_2008_sli
des.pdf�
lobal_assets/downloads/I/IC_bp_strategy_presentation_2008_sli
des.pdf�
Both the IDEM and EPA approved of BP’s expansion plans, but
many citizens and
groups opposed the manner in which the company gained
regulatory approval and how it
planned to dispose of its waste (the sequence of key events
regarding IDEM’s approval of
BP’s permit application is summarized in Table 3). Thus, Bob
Malone and BP were

faced with a dilemma as to how they should proceed.
Table 3: Key Dates
Date Event
Summer 2006 BP first contacted IDEM and EPA regarding its
intentions to
expand the Whiting Refinery
Winter 2007 BP and environmental regulators reached out to
public to gather
early opinions and attitudes
Early March 2007 BP formally submitted a written request for
permit to IDEM and
IDEM posted BP’s request on its website
March 16 –
May 11, 2007
- 60-day comment period began
- Citizens and environmental groups submitted comments to
IDEM
April 5, 2007 EPA stated that it did not object to BP’s permit
April 26, 2007 IDEM hosted a public meeting in Whiting, IN
that was attended by
citizens, environmental groups, and BP officials
May 11, 2007 The 60-day comment period was scheduled to end
Late March - early
June 2007
- Citizens, environmental groups, and businesspeople emailed
and

mailed comments to IDEM regarding BP’s permit (the vast
majority of comments were not supportive of the project)
- IDEM responded to comments
June 21, 2007 - IDEM issued final permit approval for BP
expansion
- 18-day appeal period started
June 29, 2007 Northwest Indiana newspaper reported “BP not
required to build
treatment plant in Whiting”
July 9, 2007 - 18-day appeal period ended
- IDEM did not receive any appeals, therefore permit became
effective August 1, 2007
July 15, 2007 Chicago public learned of BP’s permit; Chicago
Tribune headline
read, “BP gets a break on dumping in Lake – Refinery
expansion
entices Indiana”
Source: Easterly, T. 2008. IDEM update, January 3, 2008,
www.in.gov/idem/files/nirpc-01-03-08ppt,
accessed May 2009
BP’S MOTIVATION TO EXPAND THE WHITING REFINERY
BP’s overall corporate goal was “finding, producing and
marketing the natural energy
resources on which the modern world depends.”7 In order to do
this, Bob Malone and
other BP executives faced a competitive environment
characterized by regional instability

in the oil-producing Persian Gulf states, concern among some
people about the future
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security of oil supplies, and record high gas prices (Table 4)
and profits in the oil
industry. Few economists, businessmen, consumers, analysts,
and politicians expected
demand for oil to decrease over the next decade, and in fact the
global demand for oil was
expected to double between the period of 1980-2004 to 2004-
2030.8
The economic
incentive to meet rising demand was enticing indeed.
Table 4: U.S. Gasoline Price Trend

Source: Energy Information Agency,
http://tonto.eia.doe.gov/dnav/pet/hist/mg_rt_usa.htm, accessed
September 2009
The Whiting Refinery was integral to BP America’s success and
even to BP Global’s
achievement of their economic goals (see Table 5, below, for
financial and operational
data on BP America, and Tables 1 and 2 for data on BP Global).
In 2007, the refinery
was BP’s largest in the U.S., and was among the four largest
overall in the United States.
The operation produced about 16 million gallons of products
each day of which half was
gasoline. Approximately one in eight gallons of gas in the U.S.
and 8 percent of all
asphalt came from the Whiting Refinery. The refinery
employed 1,300 people, which
was about 4 percent of BP’s U.S.-based workforce and 1.3
percent of its global
workforce.9 (See Table 6 for additional operational data on the
Whiting Refinery.)
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Table 5: Selected Data on BP America (2007)
Market capitalization (global): $206 billion
Revenues: $105 billion
Operating capital: $46 billion
Fixed U.S. assets: $42 billion
U.S. employees: 33,000
In business since: Amoco 1889, ARCO 1866, BP 1909,
BP Amoco 1998
U.S. refineries: 5
Refining capacity: 1.5 million barrels per day
Community investment: $48 million
Service stations: 12,200
Source: BP in the U.S., www.bp.com, accessed May 2008
Table 6: Selected Data on Whiting Business Unit (2006)
Year built: 1889
Area: Covers 1,400 acres

Refining capacity: 400,000 barrels of crude oil per day
Employees: 1,300
Products made: Gasoline, diesel fuel, jet fuel, asphalt
Operation: 24 hours/day; 365 days/year
Storage tanks: 220
How raw materials are received: By ship, rail, truck, and
pipelines
Source: 2006 Environmental Statement Whiting Business Unit,
assets/downloads/V/verfied_site_
reports/N_America/Whiting_2006.pdf, accessed September 2009
Given the rising global demand for oil, BP saw a market
opportunity to expand its
refining production in Whiting. However, the additional crude
oil that BP would process
was not the Persian Gulf’s ‘light sweet crude,’ but a heavier and
difficult-to-process
Canadian Extra Heavy Crude Oil (CXHO). For these reasons,
BP planned to invest $3.8
billion to increase the Whiting Refinery’s capacity by 1.7
million gallons of gasoline and
diesel fuel per day (an increase of about 15 percent)10, but the
crude oil they were
expecting to import required a more complex refining process,
and the oil contained
greater amounts of ammonia than light sweet crude. The result
would be a 34 percent
increase in the refinery’s discharge of ammonia, and a 54
percent increase in its discharge
of Total Suspended Solids (TSS)11

, which are particles containing a variety of pollutants
such as chromium, mercury and lead.
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BP believed that the additional discharge would not cause
environmental harm to Lake
Michigan or negatively affect the health of the four million
residents who depended on
the lake for drinking water. BP stated that the water discharged
back into Lake Michigan
would be 99.9 percent pure, and that the ammonia content was
half of the EPA’s limit.
Additionally, BP stated that no technology existed to

completely remove TSS and that all
wastewater treatment plants released varying amounts of TSS.
BP equated the amount of
their proposed discharge to that of a small city.12
Despite BP’s claims, which were
officially supported by IDEM and the EPA, environmental
groups and concerned citizens
were not convinced of the safety of BP’s expansion.
In further defense of their position, BP argued that the benefits
of the $3.8 billion
expansion would help meet the rising demand of gasoline in the
Midwest, reduce
dependence on imported oil from the Middle East, provide
permanent jobs to 70-80 full-
time employees, create 2,000 temporary contract jobs, and
contribute to Indiana’s general
economic development.13 All of these articulated benefits
demonstrated BP’s
consideration for its own financial well-being, for its
stockholders, employees, and to a
certain extent to the financial interests of the community in
which it operated. Against
these benefits, BP acknowledged that the plan would increase
pollutants discharged into
the lake; however, they stated that they followed all regulatory
approval procedures in an
open and transparent manner, they did not seek exceptions or
waivers, and that their
expansion would fully comply with all existing federal and state
laws.14 BP’s operating
philosophy and public comments throughout the controversy
communicated that BP
“care[s] about the environment” and that its “environmental

commitment is demonstrated
in our significant investments that minimize the footprint of our
operations”.15
This public comment was similar to the corporate philosophy
BP articulated in nearly all
of its communication with the public. BP was one of the few
companies that published
an annual Sustainability Report, which contained detailed
efforts by the firm to reduce its
pollution (air emissions, water discharge, oil spills, and toxic
waste), create safer working
conditions for its employees, build closer alliances with the
communities in which it
operated, and promote responsible corporate governance. The
former CEO of BP, Lord
Browne, stated “we aim to achieve the sustainability of the
[corporation] and, even more
important, the sustainability of the societies in which we
operate. Companies are part of
society and in the long term we can only thrive if society is
itself thriving.”16
(Key
environmental performance metrics in BP’s 2006 Sustainability
Report are provided in
Table 7.)
Table 7: BP’s 2006 Environmental Performance Summary
Environmental Parameter Change from 2005
Direct Greenhouse Gas Emissions -4%
Primary Energy Consumption -1%

Non-Greenhouse Gas Emissions -8%
Flaring of Hydrocarbons -6%
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Fresh Water Withdrawal -13%
Discharges to Water +64%
Hazardous Waste Disposed +49%
Source: BP Sustainability Report, 2006: pg. 21
While the BP Sustainability Report addressed the firm’s
aggregate operations, BP also
published facility-level ‘Environmental Statements’. The 2007
Whiting Business Unit
report began by stating, “In all our activities we seek to display
some unchanging,
fundamental qualities – integrity, honest dealing, treating
everyone with respect and

dignity, striving for mutual advantage and contributing to
human progress.” Among the
business unit’s goals were “to have the best competitive
corporate, operating, and
financial performance” and to “carry on its business in an
environmentally responsible
manner.”17 Contained in this report were the refinery’s efforts
and results in reducing
water and air pollution (see Figures 1 and 2). Since 1998, the
Whiting Refinery’s
capacity utilization was steady. However, in the first half of
2006 utilization increased,
which resulted in an increase in air and TSS emissions18
. Absent from this report were
data involving the release of ammonia.
Figure 1: Whiting Refinery’s Historic Discharge of TSS
Source: Whiting Business Unit, 2006 Environmental Statement,
pg. 9
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Figure 2: Whiting Refinery’s Historic Greenhouse Gas
Emissions in Kilotonnes
(1 kilotonne ~ 2.2 million pounds)
Source: Whiting Business Unit, 2006 Environmental Statement,
pg. 7
STAKEHOLDERS OPPOSED TO BP’S ORIGINAL
INTENTION
Among the most vocal groups opposed to BP’s expansion plans
were the environmental
organizations Save the Dunes and Alliance for the Great Lakes.
In May, 2007, Save the
Dunes19 and Alliance for the Great Lakes20 submitted
comments to IDEM urging the
agency to exercise caution regarding its impending regulatory
decision to grant BP a
permit to expand the Whiting Refinery. On June 21st, 2007,
IDEM sent a letter to BP
approving the Whiting Refinery’s expansion plans and resultant

increases in pollution
discharge.21 However, in August 2007, Alliance for the Great
Lakes filed a complaint
against IDEM arguing that the regulatory agency did not make
its approval of the BP
expansion sufficiently public, as it is legally required to do. In
this petition, Alliance for
the Great Lakes wrote that they “did not receive adequate notice
of IDEM’s final action”
because in mid-May of 2007 the Alliance submitted written
comments to IDEM via fax
and U.S. mail, and according to Indiana state law IDEM was
required to “give written
notice” that it approved BP’s permit. The Alliance maintained
that neither it nor
Indiana’s LaPorte County Environmental Association received
written notice of IDEM’s
decision and therefore the appeal period should be extended.
The Alliance acknowledged
that IDEM posted a permit on the agency’s website, but noted
that IDEM’s letter
approving the permit did not include a date. Therefore, the
environmental groups argued
they were not aware that the permit was issued and that it was
in fact final22, and thus
their legal right to be notified of IDEM’s decision had been
violated.
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According to some reports, IDEM took three actions that
exacerbated the public’s
outrage: 1) IDEM did not make its decision publicly known in a
timely manner23, 2)
IDEM’s approval marked the first time in several years that a
company was authorized to
increase its level of pollution into Lake Michigan, amid great
efforts to clean up the lake,
and 3) the agency granted BP the “first ever exemption” to the
Clean Water Act, allowing
them to dilute their pollution 200 feet offshore in what was
called a ‘mixing zone’ and
this process was “banned in Lake Michigan under Indiana state
law.”24
Throughout the permit process, several small-town newspapers
in northwest Indiana had
been intermittently covering the story. While many local
residents were opposed to the
expansion, there were also many who paid it little attention as

they welcomed economic
development in the region. The expansion of BP’s Whiting
Refinery was suddenly
presented to millions of people in Chicago on Sunday, July 15,
2007, when the Chicago
Tribune’s environmental correspondent, Michael Hawthorne,
wrote a story with the
headline “BP Gets a Break on Dumping in Lake”. The article
described how the
“massive BP oil refinery in Whiting, Ind., is planning to dump
significantly more
ammonia and industrial sludge into Lake Michigan running
counter to years of efforts to
clean up the Great Lakes,”25
and how citizens and environmental groups were
unsuccessful in persuading BP and Indiana’s environmental
regulators to take greater
care to ensure that pollution levels discharged into Lake
Michigan would not be
increased.
Only months earlier, Chicago Mayor Richard Daley pledged to
make Chicago the
‘greenest’ city in America. For years, Chicago residents and
politicians invested millions
of dollars to clean up Lake Michigan, develop environmentally
sustainable business
practices, and constructed the highest number of
environmentally-friendly building
projects in the United States. Literally hours after the story
broke in the Chicago
Tribune, thousands of Chicagoans were outraged and began
contacting their elected
representatives.

Shortly thereafter, the list of politicians who stepped forward to
voice their opposition
included U.S. Senators Richard Durbin (D-IL), Barack Obama
(D-IL) and Richard Lugar
(R-IN), and U.S. Representatives Rahm Emanuel (D-IL), Dan
Lipinski (D-IL), Pete
Hoekstra (R-MI), Vernon Ehlers (R-MI) and Mark Kirk (R-IL).
Representative Kirk
later said on a radio show, “BP…now stands for ‘Bad
Pollution’”26. Mayor Daley and
the Chicago Park District were equally upset. The mayor
“threatened legal action to
block the permit,”27 and the Park District initiated a petition
drive at Illinois beaches to
generate public awareness and opposition to BP’s plans, which
ultimately secured
signatures numbering in the tens of thousands.28
In the ensuing weeks, Chicago city alderman Edward Burke
proposed a plan to stop city
employees from using BP gas stations and to prevent three
banks that conducted business
with BP from receiving further contracts from the city of
Chicago. The editorial staff at
the Chicago Sun-Times called for consumers to boycott BP, but
Mayor Daley advised
against it until Indiana’s governor had a chance to review
IDEM’s approval.29 Senator
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Durbin requested the U.S. EPA use its regulatory powers to
prevent BP’s proposal from
going forward until additional public comments could be
presented, and several federal
Indiana lawmakers met with Bob Malone to pressure him to stop
the Whiting Refinery’s
plans.30 Additionally, Senator Obama pressed the Chair of the
Senate Environment and
Public Works Committee to hold a hearing on IDEM’s
authorization of BP’s expansion
plans.31 The protest was not limited to Illinois and Indiana; in
early August, Michigan
State Representative Arlan Meekhof and other state politicians
supported a resolution to
oppose BP’s plans. Finally, the U.S. Congress overwhelmingly
passed a “resolution to
urge the EPA to reconsider issuance of the permit.”32
STAKEHOLDERS WHO SUPPORTED BP’S DECISION

Despite complaints filed by multiple environmental
organizations, letters to agencies and
BP executives by state and federal representatives, thousands of
individual signatures on
petitions, and well-respected media outlets’ opposition of BP’s
plans, there were several
stakeholder groups who supported the expansion. Many of
these stakeholders
emphasized the large economic benefits to the region as a result
of BP increasing its
refining capacity.
When BP had announced its decision to expand its Whiting
Refinery, they had noted that
it would be a $3.8 billion investment in the region, consisting of
capital investment, the
creation of jobs, and a boost to the region’s economic
development. One of the project’s
strongest supporters was Indiana Governor Mitch Daniels. In
September 2006, when BP
had announced it was in its “final planning stage” for the
refinery’s expansion, Governor
Daniels stated, “We appreciate BP’s choice of Indiana for this
massive, landmark
project…In capital investment this is the largest we’ve
had…The eyes of the whole state
are on Northwest Indiana today, as they should be. This marks
another huge step in
Indiana’s economic comeback.”33
At this stage, Governor Daniels may not have been informed of
the environmental
consequences of the expansion because BP was still months
away from applying for

regulatory approval. However, after IDEM issued the final
permit on June 21, 2007, and
the eruption of the firestorm in mid-July, Governor Daniels
maintained his support for the
expansion. Regarding BP’s application and IDEM’s approval
for increasing discharge
into Lake Michigan, Governor Daniels stated: “We’ve checked
it and rechecked it.
They’re in complete compliance with Indiana law, which is
tougher than federal
law…We’ve got thousands of jobs that will be at risk if [the
expansion] doesn’t go
forward…I don’t think it should be held up without a good
scientific reason, and none
has been provided.”34 As the controversy continued to build,
Governor Daniels
recommended a “credible, independent evaluation of the
permitting decision and
outcome,” and asked an Indiana University professor and former
EPA attorney in the
Reagan Administration to review the impact that BP’s proposed
discharge would have on
the health of Lake Michigan.35
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Other stakeholders supporting BP’s decision included the
IDEM, EPA, Indiana Chamber
of Commerce, Chicagoland Chamber of Commerce, and the
Illinois Petroleum Council,
which was a trade association that represented oil companies’
interests in the state.36
Many individuals from these organizations had an opportunity
to express their support for
BP on August 22, 2007, when the Indiana Administrative Rules
Oversight Committee
(IAROC) held a public meeting to discuss IDEM’s approval of
the Whiting Refinery
expansion. The oversight committee was comprised of Indiana
state senators and
representatives authorized under Indiana law to convene either
at the committee’s
discretion or when a citizen or group of citizens filed a
complaint against a ruling made
by a regulatory agency. After conducting such hearings, the
IAROC could then make a
series of recommendations to the agencies in question and to the
Indiana legislature, at
which point the legislature could adopt additional laws if
necessary. In this case, the
complaint filed by the Alliance for the Great Lakes and other

tremendous political
pressure prompted the IAROC to hold the meeting.
At the August 22 hearing, the President of the Indiana Chamber
of Commerce, Kevin
Brinegar, stated, “It is the height of hypocrisy for local and
national politicians to bemoan
$3 a gallon gasoline and then deny the means to increase our
country’s ability to refine
oil – particularly when that capacity is being expanded after a
thorough, public and
scientifically-based permitting process.” He added, “Businesses
of all sizes need to know
they can rely on existing regulations and that the processes of
government are fair,
objective, and reliable.”37
The Director of IDEM, Thomas Easterly, also reaffirmed his
support of the expansion
and of his agency’s handling of the approval process. He stated
that he was stunned by
the public’s outrage because the April 26 meeting (hosted by
IDEM in Whiting to hear
the public’s comments on IDEM’s approval of the permit)
during the 60-day comment
was sparsely attended. Easterly stated, “This is a good permit.
This is a very restrictive
permit…I’m not aware of people doing much better than
this.”38
BP’s Whiting Refinery manager, Dan Sajkowski, also testified
in support of the

expansion and he emphasized three important points: 1) the
economic impact on the
region would be enormous, 2) BP followed all applicable rules
and regulations when they
applied for the permit, and 3) BP engineers did not believe an
increase in TSS and
ammonia discharge would have harmful effects on residents
living near Lake Michigan
or on the lake’s ecosystem.39
BP’S IMPENDING DECISION
In late August 2007, Bob Malone was faced with a difficult
decision: How to go forward
in pursuit of a $3.8 billion capital project that would increase
the region’s supply of
refined petroleum products in a climate of intense regional and
national opposition. Even
though the expansion would not be completed until 2011 (if it
proceeded as planned),
Malone was confronted with a crucial decision that would have
great consequences for
the Whiting Refinery, BP America, and BP Global.
16
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Endnotes
1 BP in America report, 2007, bp.com
2 BP Fact Sheet. 2007. Dated March, 2007.
www.indianalawblog.com/documents/bp_factsheet.pdf,
accessed November, 2007
3 Davis, C. 2007. Alliance for the Great Lakes, Petition for
administrative review and request for stay of
permit, filed August 14, 2007,
www.allianceforthegreatlakes.org/news/pdf/Petition-
Indiana.081407.doc,
accessed November, 2007
4 Anderson, T., & Clay, C. 2007, Save the Dunes Comments on
BP NPDES, Letter to IDEM,
www.savedunes.org/news/index.php?uid=3602a20a526f,
accessed September 2007
5 BP Sustainability Report 2006.
www.bp.com/sectiongenericarticle.do?categoryId=9010753&con
tentId=7021550, accessed September
2007
6 BP 2006 Whiting Business Unit Environmental Statement.
7 BP.com
8 BP Sustainability Report 2006, pg. 4, citing figures from the
OECD/IEA World Energy Outlook
9 BP in the United States and Indiana, press release dated July
20th, 2007.
10 BP Whiting Refinery Fact Sheet, 2007.

www.whiting.bp.com/go/doc/1550/165356/, accessed September
2007
11 BP Factsheet, 2007
12 BP Whiting Refinery Fact Sheet, 2007
13 Sajkowski, D. 2007. BP Talking points for Dan Sajkowski –
Whiting Refinery Manager, talking points
for Aug 22nd, 2003 Hearing Indiana Administrative Rules
Oversight Committee,
www.bpissuesnews.com/go/doc/1550/169737, accessed
September, 2007
14 Ibid, pp. 5-6
15 Ibid, pg. 1
16 BP Sustainability Report, 2006: 2
17 Whiting Business Unit, 2006 Environmental Statement, BP
sustainability report, www.bp.com, accessed
November, 2007, pg. 2
18 Ibid, pg. 7
19 Anderson & Clay, 2007
20 Davis, C. 2007
21 IDEM, 2007. State of Indiana Department of Environmental
Management authorization to discharge
under the National Pollutant Discharge Elimination System,
dated June, 21, 2007
22 Davis, 2007, pg. 8
23 Ibid
24 Hawthorne, M. 2007a. BP gets a break on dumping into the
lake. Chicago Tribune, July 15, 2007
25 Hawthorne, M. 2007a. BP gets a break. Chicago Tribune.
July 15, 2007.
26 Hawthorne, M. 2007b. BP backs down! BP backs down on
dumping in lake. Chicago Tribune, August
23, 2007
27 Brainard, C. 2007. Sun-Times says boycott BP, Columbia
Journalism Review, August 17, 2007

28 Hawthorne, M. 2007b.
29 Brainard, 2007
30 Reuters, 2007. Lawmakers oppose BP oil refinery expansion,
July 24, 2007
31 Obama, B. 2007. Obama Calls on EPW Committee to
Examine Approved Lake Michigan Pollution.
Press release dated August 15, 2007,
www.obama.senate.gov/press/070815-obama_calls_on_12/,
accessed
December 2007
32 Meekhof, A. 2007. Meekhof opposes BP plan to dump waste
in Lake Michigan, press release from
Representative Arlan Meekhof’s office, dated August 7, 2007
33 BP Press Release, 2006. BP plans $3 billion project to refine
more Canadian heavy crude oil in the
U.S. Midwest, dated September, 20, 2006,
www.whiting.bp.com/go/doc/1550/165362, accessed December
2007
34 Guinane, P. 2007a. Daniels won’t budge on BP. Northwest
Indiana Times, July, 26, 2007
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http://www.indianalawblog.com/documents/bp_factsheet.pdf�
http://www.allianceforthegreatlakes.org/news/pdf/Petition-
Indiana.081407.doc�
http://www.savedunes.org/news/index.php?uid=3602a20a526f�
http://www.bp.com/sectiongenericarticle.do?categoryId=901075
3&contentId=7021550�
http://www.whiting.bp.com/go/doc/1550/165356/�
http://www.bpissuesnews.com/go/doc/1550/169737�
http://www.bp.com/�
http://www.obama.senate.gov/press/070815-
obama_calls_on_12/�
http://www.whiting.bp.com/go/doc/1550/165362�
35 Guinane, P. 2007b. Daniels commissions review of BP
permit. Northwest Indiana Times, August, 14,
2007
36 Brainard, 2007
37 Indiana Chamber of Commerce, 2007. Statement on BP
permit for Whiting Refinery: Rules followed,
project should move forward, dated August, 22, 2007,
www.indianachamber.com/newsdetail.asp?ID=3406, accessed
December, 2007
38 Callahan, R. 2007. Agency chief says BP refinery uproar late
coming, Associated Press, August 23, 2007
39 Callahan, R. 2007
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