BP after the spill: Bankrupt, bought, or business as usual?

Bankruptcy or reorganization

Verdict: Plausible

    In a more dramatic scenario, what are the chances of BP dissolving altogether or undergoing a major reorganization under Chapter 11?

    This could happen if the company's financial picture becomes so weak that the business can no longer operate. While ongoing cleanup and damage costs are expected to be quite high, those payments alone won't likely force the company under.

    The bigger threat is the potential costs from BP's myriad of spill-related lawsuits, which so far range from compensation for personal injury to lost business to environmental damage. And this might just be the beginning, with the U.S. government considering moving forward with its civil and criminal investigations into the oil spill.

    Eventually, the flood of suits could become too much for BP to handle while the company deals with serious drops in its stock, says Peter Tamposi, an attorney and professor in bankruptcy law at the Franklin Pierce Law Center in New Hampshire.

    True, Exxon is still standing following the 1989 Valdez oil spill in Alaska. Litigation took about 20 years to resolve. And after lengthy appeals, damages that were at one point in the billions of dollars were reduced down to millions.

    But the scale of impact along the Gulf is much bigger. Cases are being filed from all over the Southeast, including Texas, Louisiana, Alabama, Mississippi and Florida. "At some point, it becomes too difficult for the company to manage both financially and logistically," Tamposi says. "You're going to have BP professionals essentially being lawyers and not oil drillers. It could reach a point where it won't make sense to continue going on."

A bit bruised but just fine

Verdict: Unlikely

    Whatever the fate of BP, the company will be forever changed. For the next several years, it will likely have to deal with new regulations changing the way it does business, ongoing reputation control and a plethora of legal headaches.

    These costs -- tangible or not -- will quickly add up. And that is something that no green marketing campaign can offset.