Anderson Cooper talked to Fred McCallister, an investment banker with Allegiance Capital Corporation, who is going to be testifying before the Senate Commerce, Science and Transportation Committee today about something that's appeared painfully obvious to me for some time now, that BP is using dispersants to hide the size of the oil spill in the hopes if limiting their liability. My only question is why has the government allowed them to do it?
ANDERSON COOPER: Fred McCallister joins us now.
Fred, why do you think that BP would prefer to use dispersants over skimmers?
FRED MCCALLISTER, VICE PRESIDENT, ALLEGIANCE CAPITAL CORPORATION: Anderson, thank you for having me on tonight.
The issue that BP is facing right now is whether to use what's practices that are normal around the world, which is to try to cause the oil to come to the surface, and then deploy the right amount of equipment and the right type of equipment to gather that oil up and get it out of the Gulf.
Using the dispersants allows the oil to stay under the surface, and this accomplishes several purposes. It allows the -- it makes it a lot more difficult to quantify the amount of oil that's coming out, which has a direct impact on damages and royalties that have to be paid.
It keeps it out of sight and out of mind. And it allows BP to amortize the cost of the cleanup over several years, 10 to 15 years, because some of this oil is going to biodegrade, but a lot of that oil is going to roll up on the beaches for 10 or 15 years.
And if they can amortize that over 10 or 15 years,as opposed to dealing with that over the next 15 months, that's a much better financial position for BP to be in.
COOPER: Well, let's be clear, though. The EPA has sanctioned the use of dispersants on the spill. Dispersants are generally less harmful, they say, and toxic than the oil itself. But you say it's really about BP's financial interests?
MCCALLISTER: Well, it's about -- well, in terms of environmental impact, it's about getting the oil to the surface and getting it out of the water. That's the best solution, bar none.
And I understand that the EPA has sanctioned the use of these dispersants, but I also believe that BP is in control of this situation. And they're doing what's in the best interest of BP and their shareholders.
No one wants BP to fail, trust me. I don't want BP to fail. It's in the best interests of the country and everybody in the Gulf region. I happen to be from that region. I have family there. I have property there. I want BP to succeed.
COOPER: But do you have any direct evidence, though, that what you're saying, what you believe is true is actually true? I mean, do you have any evidence that BP is basically using these dispersants to keep the oil from not coming to the surface for financial motives, and not using these skimmers?
MCCALLISTER: I -- I have been working on this project of trying to get these skimmers into the Gulf for over a month now.
Everybody in Europe, where standard practice is to raise the oil and to collect it, is scratching their heads and, quite honestly, laughing at what's happening in the Gulf. This is -- and I have educated myself over the last month, as I have gone through this process of trying to get these skimmers here, because it seems self- evident that these skimmers were needed.
People like Billy Nungesser down there are using makeshift equipment. And so I began to educate myself. And what I have learned is that everybody is looking at us and wondering why we're allowing this to happen.
And, as a businessman, the only answer I could come up with is, what are the motivations for not dealing with this issue head-on, raising the oil, and collecting it with the skimmers? And the only answer is the financial interest of BP.
I don't -- I don't see any other reason that it should be handled the way that it's handled.
COOPER: I mean, the other alternative could be, A, that they believe in the dispersants or don't believe in the skimmers, or, B, that they're simply incompetent or just not doing a very good job.
MCCALLISTER: Well, Anderson, it's a grand experiment on an unprecedented scale.
And, unfortunately, I don't know that we're going -- you and I are going to know the results of this experiment until we get 20 years down the road. I think we know what the result would be if we put an armada of vehicles -- vessels out there and gathered the oil off the surface and took it out of the Gulf.
We know what would result from that. We don't know what's going to result from emulsifying this oil into the Gulf, what's happening under the surface to the marine life, and what the long-term effects are going to be.
Well, I should point out, as we always do, we invited BP to be on the program tonight to defend themselves, basically, and show their side of the story. They declined that. In particular, in response to this, they said they wouldn't have any response to your allegations.
Mr. McCallister, I appreciate you being on with us tonight. Our invitation stands, as always, to BP to come on.
MCCALLISTER: Thank you.