Page 1 of 1 104 Sutaimable Sapply Chain Manegemes CASE STUDY: HAITIAN OIL Read t
ID: 360139 • Letter: P
Question
Page 1 of 1 104 Sutaimable Sapply Chain Manegemes CASE STUDY: HAITIAN OIL Read the following two passages concerning the discovery of petroleum reserves in t nation of Haiti. Try to spot environmental and social sustainability issues then answer the questions at the end. PASSAGE #1 Adapted from: Polson. Jim. "Haiti Earthquake May Have Exposed Gas, Aiding Economy." January 26, 2010. Available at http://www.bloomberg.com. In 2010 an earthquake killed more than 150,000 people in Haiti. It may have left clues to petroleum reservoirs that could aid economic recovery in the Western Hemisphere's poorest nation, a geologist said The January 12 2010 earthquake was on a fault line that passes near potential gas reserves," said Stephen Pierce, a geologist who worked in the region for 30 years. The quake may have cracked rock formations along the fault allowing gas or oil to temporarily seep toward the surface, he said. "A geologist, callous as it may seem, tracing that fault zone from Port-au- Prince to the border looking for gas and oil seeps, may find a structure that hasn't been drilled," said Pierce, exploration manager at Zion Oil &Gas; Inc., a Dallas- based company that's drilling in Isradl. "A discovery could significantly improve the country's economy and stimulate further exploration Following the earthquake, the Haitian Prime Minister Jean-Max Bellerive met in Montreal with diplomats, including U.S. Secretary of State Hillary Clinton, to discuss redevelopment initiatives. Canadian Foreign Affairs Minister Lawrence Cannon said wind power may play a role in rebuilding the Caribbean nation, where forests have been denuded for lack of fuel, the Canadian Press reported. "Haiti, from the standpoint of oil and gas exploration, is a lot less developed than the Dominican Republic," Pierce said. "One could do a lot more work there." More than 600,000 people are without shelter in the Port- au-Prince area, the United Nations said January 22 2010. The 7.0 magnitude quake destroyed about one-third of the buildings in Port-au- Prince. It also knocked out the capital's seaport and water and sewage systems "Relief and recovery for the survivors is the priority now," Mark Fried, a spokesman for British charity Oxfam, said in a statement. "Hundreds of thousands who lost everything but their lives need water, shelter and toilets to stop the spread of disease," he said. Haiti will need "massive support for a "colossal" reconstruction from the earthquake, Bellerive said at the meeting in Montreal. The Greater Antilles, which includes Cuba, Haiti, the Dominican Republic, Puerto Rico, and their offshore waters, probably hold at least 142 million barrels of oil and 159 billion cubic feet of gas, according to a 2000 report by the U.S. Geological Survey
Explanation / Answer
As per my analysis the investment in oil exploration in Haiti is a good decision that may help the company to make much profit. Though there are many challenges or risks involved, the decision would help company in long run. As per the analysis Haiti is very rich in petroleum resources and exploring the petroleum reservoirs would not be much difficult after the earth quake. The oil price has increase globally and the nations are trying to explore more resources to meet the consumer demands. The existing reservoirs are getting dried up.
The main risks associated with starting business in Haiti are environmental risks. Haiti is prone to earth quakes and volcanoes because of its geographical features. Hence doing business in Haiti would be very risky and most people would not be ready to risk their life and move to Haiti for business. The transport system also may face so many issues due to the natural hazards. Another factor is the social factors. Social conditions in Haiti are not good and the people are suffering from poverty and contiguous diseases. There are chances of violence and theft attacks from the local people due to extreme poor conditions. The political conditions may not affect the business much because Haiti is in need of foreign investment and there would not be much restrictions in entering the business.
The foreseeable costs include the cost required for building and maintain the transport system. The roads would be broken due to earth quake and it needs to be repaired. There are chances for earth quakes in future also; hence we should be ready to meet the future costs also. As the buildings are damaged due to earth quake and the company need to construct the buildings for employees as well. Another foreseeable cost includes the cost for proper communication system. The communication systems need to be built and maintained for ensuring continued operation. Other costs include the cost required to ensure a better living atmosphere for the employees by meeting the daily requirements. The benefits include the high profit the company can gain after selling the oil products to the other countries. The labor cost can be kept low by employing the local people in Haiti and as they are struggling with poverty the demand would be less than the demands of workers from other countries.
Our investment in Haiti would help many of the unemployed people in Haiti to get job and earn their living. When the company starts operating in Haiti so many other business also would get establishes in Haiti to meet the demands of the company workers in Haiti. The social conditions also would improve. Good health care centers are required for the treatment of company workers and new healthcare centers would start. Company would start campaigns to stop the spreading of disease as it may affect our workers and the Haiti people can get benefit out of it. New educational institutions also would start. As the economical conditions improve in Haiti, lot of new companies would be ready to move to Haiti and it can improve in economic growth and social conditions.
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.