Monday, March 26, 2012

 

BP in $7.8-billion settlement



From The Hindu

Oil major BP has agreed to pay $7.8 billion in a settlement reached with claimants affected by the spill from one of its wells in the Gulf of Mexico in April 2010.


Commenting on the landmark settlement reached with the Plaintiffs' Steering Committee, which acts on behalf of individual and business plaintiffs in the multi-state proceedings ongoing in New Orleans, Bob Dudley, BP CEO, said, “The proposed settlement represents significant progress toward resolving issues from the Deepwater Horizon accident and contributing further to economic and environmental restoration efforts along the Gulf Coast.”

In a statement BP noted that it expected that the cost of the proposed settlement would be paid from the $20-billion escrow-account Trust, and would include a promise by BP to make good on $2.3 billion worth of economic loss sustained by the Gulf seafood industry.

The latest settlement comes in the wake of a string of filings and counter-filings between BP and the other corporations associated with the operation of the Deepwater Horizon rig, whose explosion in 2010 killed 11 workers and spewed four million barrels of oil into the Gulf.

Even as an unprecedented and costly operation to halt the leakage and mop up the oil followed, BP in a lawsuit alleged that one of its contracting companies, Halliburton, had destroyed vital evidence relating to the explosion. By late last year Halliburton had already slammed BP with a lawsuit over “for negligent misrepresentation, business disparagement and defamation.” BP has also sued other companies including rig owner Transocean and manufacturer of a failed blowout preventer, Cameron International.

Yet the Obama administration has kept up pressure on BP. Speaking on the occasion of the first anniversary of the Gulf of Mexico oil spill President Barack Obama said, “We continue to hold BP and other responsible parties fully accountable for the damage they have done and the painful losses that they have caused.”

In an interview with The Hindu, Kenneth Feinberg, Mr. Obama's “pay czar” charged with disbursing compensation from the $20 billion fund, said that BP as the “wrongdoer” had to step up and “pay the freight” of the compensation programme. At the time Mr. Feinberg said that that although $3.6 billion had already been disbursed to over 200,000 claimants, the emotional side of the disaster should not be disregarded, in particular the fact that many individuals, families and businesses had seen their livelihoods wiped out.

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Wednesday, December 07, 2011

 

Halliburton destroyed spill evidence: BP

From The Hindu

BP, the company held responsible for the worst oil spill in the United States' history, has accused one of its contracting companies, Halliburton of destroying vital evidence relating to the explosion of the Deepwater Horizon rig on April 20, 2010, in which 11 rig workers were killed and more than 200 million gallons of crude spewed into the Gulf of Mexico.

In a dramatic turn of events in the ongoing litigious slugfest between the corporate giants, BP said in a New Orleans federal court filing that Halliburton deliberately wiped out all traces of evidence about potential flaws in the cement slurry used to encase the ill-fated Macondo well.

Though proper cementing is a critical pre-requisite to avoid blowouts of the sort experienced in the Gulf disaster, BP's allegations suggest that Halliburton fudged its response to a court order to bring forth “inexplicably missing” computer modelling results.

In its papers BP said, “Halliburton has steadfastly refused to provide these critical testing and modelling results in discovery. Halliburton's refusal has been unwavering, despite repeated BP discovery requests and a specific order from this Court.”

As per BP's statement, Halliburton was said to have destroyed the results of physical slurry testing, an “egregious” act designed to “eliminate any risk that this evidence would be used against it at trial”.

The first trial for the oil spill is set to begin on February 27 2012 and will aim to apportion liability to each company involved and there will be further legal reviews to assign punitive damages and cleanup costs. BP has already set up a $20-billion fund to finance the clean-up and reconstruction of the Gulf coastline.

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Tuesday, May 31, 2011

 

U.S. still holds BP accountable for “painful losses”: Obama


From The Hindu

“We continue to hold BP and other responsible parties fully accountable for the damage they have done and the painful losses that they have caused,” said United States President Barack Obama, speaking on the occasion of the first anniversary of the Gulf of Mexico oil spill.

When the Deepwater Horizon oil rig operated by BP exploded on April 20 last year, it killed 11 men and released an estimated 4.9 million barrels of oil into the Gulf, making it the worst spill in U.S. history and an environmental catastrophe of unprecedented magnitude.

In a statement on Tuesday Mr. Obama said that the “catastrophic event” had deeply affected the lives of millions of Americans, from local fishermen to restaurant and hotel owners and small businesses throughout the region. He reiterated that from the beginning, his administration had sought to bring every available resource to bear, “amassing the largest oil spill response in our nation’s history.” Yet, he added, while significant progress had been made, “The job is not done.”

In an earlier interview with The Hindu, Kenneth Feinberg, Mr. Obama’s “pay czar” charged with disbursing compensation to the Gulf spill victims out of a $20 billion fund set up by BP, said that BP as the “wrongdoer” had to step up and “pay the freight” of the compensation programme. Mr. Feinberg added that although $3.6 billion had already been disbursed to over 200,000 claiimants, the emotional side of the disaster should not be disregarded, in particular the fact that many individuals, families and businesses had seen their livelihoods wiped out.

Providing an update on the recovery efforts a year later, Mr. Obama said that nearly 2,000 responders were still actively working in the Gulf and the disaster response team was “monitoring seafood to ensure its continued safety and implementing aggressive new reforms for offshore oil production in the Gulf so that we can safely and responsibly expand development of our own energy resources.”

Arguing that his administration would continue to keep “a watchful eye” on the continuing work required to ensure that the Gulf Coast recovers “stronger than before,” Mr. Obama added that Lisa Jackson, Administrator of the Environmental Protection Agency was leading a task force to coordinate the long-term restoration effort based on input from local scientists, experts, and citizens.

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Thursday, September 09, 2010

 

Sequence of failures, says BP


From The Hindu

A string of eight serious failures within the Deepwater Horizon oil rig led to its explosion and the subsequent large-scale pollution of the Gulf of Mexico, said an internal investigation report by BP.

The findings of the "Accident Investigation Report" released by BP this week, may be considered compelling evidence for an overhaul of both BP’s internal systems as well as regulatory oversight for the oil industry.

In the report, the investigators said, "No single factor caused the Macondo well tragedy. Rather, a sequence of failures involving a number of different parties led to the explosion and fire which killed 11 people."

Further the report concluded that decisions made by "multiple companies and work teams" contributed to the accident which it says arose from "a complex and interlinked series of mechanical failures, human judgments, engineering design, operational implementation and team interfaces".

Among the key failures that led to the explosion, the report cited cement and shoe track barriers at the bottom of the well that failed to contain hydrocarbons within the reservoir; the results of negative pressure tests being accepted by BP and Transocean despite well integrity not being established; the Transocean rig crew failing to recognise and act on the influx of hydrocarbons into the well; gas being vented directly on to the rig rather than being diverted overboard; gas flowing into the engine rooms through the ventilation system created potential for ignition; and the rig’s blow-out preventer not activating automatically to seal the well.

Role of other parties

Emphasising the role of other parties besides BP, its current CEO Bob Dudley said: "We have said from the beginning that the explosion on the Deepwater Horizon was a shared responsibility among many entities." He said the report made that conclusion even clearer, presenting a detailed analysis of the facts and recommendations for improvement both for BP and the other parties involved.

However, Mr. Dudley said, "We have accepted all the recommendations and are examining how best to implement them across our drilling operations worldwide," reiterating that BP "deeply [regretted] this event [and] sought throughout to step up to our responsibilities".

The report also proposed 25 recommendations designed to prevent a recurrence of such an accident, BP said, and they were directed at strengthening assurance on blow-out preventers, well control, pressure-testing for well integrity, emergency systems, cement testing, rig audit and verification, and personnel competence.

The company said it expected a number of the investigation report’s findings to be considered relevant to the oil industry more generally and for some of the recommendations to be widely adopted.

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Friday, August 20, 2010

 

Persistent plume found


From The Hindu

The persistence of a giant plume of oil in the Gulf of Mexico suggests that the long-term impact of the BP Deepwater Horizon spill may be worse than earlier assumed, a new scientific study has revealed.

In the latest issue of Science magazine, researchers at the Woods Hole Oceanographic Institution (WHOI) discussed their investigations of a plume of hydrocarbons at least 22 miles long and more than 3,000 feet below the surface. According to Christopher Reddy, a WHOI marine geochemist and oil spill expert, “The plume was not a river of Hershey’s Syrup... But that’s not to say it isn’t harmful to the environment.”

Doubts on earlier claims

Their discovery has cast doubt upon earlier claims by government agencies such as the National Oceanic and Atmospheric Administration (NOAA), which said that 74 per cent of the oil that gushed into the Gulf between April and August was either captured directly at the Macondo well site, had naturally evaporated or had been dispersed by operations at the surface and dissolved into microscopic droplets.

According to the most recent study, the 1.2-mile-wide, 650-foot-high plume of trapped hydrocarbons provided at least a partial answer to recent questions asking where all the oil had gone as surface slicks shrank and disappeared. Mr. Reddy said, “These results indicate that efforts to book-keep where the oil went must now include this plume.”

The WHOI study also disputed official estimates of the speed at which deep-sea microbes were degrading the plume. The plume has shown that the oil already “is persisting for longer periods than we would have expected”, according to Richard Camilli, Chief Scientist at WHOI and lead author of the paper. He added, “Many people speculated that subsurface oil droplets were being easily biodegraded. Well, we didn’t find that. We found it was still there.”

The WHOI study was based on approximately 57,000 discrete chemical analyses undertaken during a June 19-28 scientific cruise. The expedition entailed the use of two highly advanced technologies: the autonomous underwater vehicle and an underwater mass spectrometer.

While the WHOI scientists noted that they had found no “dead zones”, or regions of significant oxygen depletion within the plume where marine life could not survive, WHOI geochemist Benjamin Van Mooy, said this finding could have significant implications.

“If the oxygen data from the plume layer are telling us it isn’t being rapidly consumed by microbes near the well,” he said, “the hydrocarbons could persist for some time. So it is possible that oil could be transported considerable distances from the well before being degraded.”

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Tuesday, July 27, 2010

 

Hayward to step down, BP makes $17 billion loss


From The Hindu

In a bid to save what is left of its reputation, BP announced that its gaffe-prone British CEO, Tony Hayward would step down and be replaced by an American chemical engineer and head of mop-up operations in the Gulf of Mexico, Robert Dudley.

The company, which has not only come under scathing attacks for its role in the oil spill but also courted controversy relating to the release of convicted Libyan terrorist Abdel Baset al-Megrahi, said Mr. Hayward would stop functioning as group chief executive with effect from October 1, 2010.

Seeking to project the change in the leadership as a break from its past, BP chairman Carl-Henric Svanberg said, "The tragedy of the Macondo well explosion and subsequent environmental damage has been a watershed incident. BP... will be a different company going forward, requiring fresh leadership supported by robust governance and a very engaged board."

The announcement came even as BP admitted that it had made a record "replacement cost" loss during the second quarter of the year, amounting to a staggering $17 billion. The company said it was facing a charge of $32.2 billion, "to reflect the impact of the Gulf of Mexico oil spill, including costs to date of $2.9 billion for the response and a charge of $29.3 billion for future costs, including the funding of the $20 billion escrow fund".

Remarking on the financial results, Mr. Hayward said, "We expect we will pay the substantial majority of the remaining direct spill response costs by the end of the year. Other costs are likely to be spread over a number of years, including any fines and penalties, longer-term remediation, compensation and litigation costs."

On stepping into the shoes of Mr. Hayward, Mr. Dudley said that in the change of roles, he particularly wanted the people of the Gulf Coast to know that his commitment to remediation and restitution in the region was not lessened. "I gave a promise to make it right and I will keep that promise," he said.

In a comment that reflected the management’s commitment to those affected by the spill but equally to BP shareholders, Mr. Svanberg said, "We remain confident in our ability to meet our obligations to those on the Gulf Coast of the United States, other impacted parties and all our stakeholders... As we said last month, the Board remains strongly committed to the payment of future dividends and delivering long term value to shareholders."

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Friday, July 23, 2010

 

Gulf operations halted for Bonnie


From The Hindu

The Gulf of Mexico oil spill response faced a temporary setback heading into the weekend, as operations were halted due to the expected approach of tropical storm Bonnie.

In an update, the Gulf Unified Area Command Centre said it was tracking tropical weather near the Bahamas very closely and was constantly engaged in discussions with the National Hurricane Centre, the National Oceanic and the Atmospheric Administration and Federal Emergency Management Agency to ensure the safety of more than 40,000 people currently assisting in the oil spill response and recovery efforts.

Admiral Thad Allen, National Incident Commander overseeing the disaster response said, "Due to the risk that Tropical Storm Bonnie poses... many of the vessels and rigs will be preparing to move out of harm's way beginning tonight. Some of the vessels may be able to remain on site, but we will err on the side of safety." He added that the rig drilling the relief well — which it is hoped will ultimately kill the well — as well as other vessels needed for containment will also be moved from the areas at risk from the storm.

The Unified Command Centre further noted that boom was being removed from marsh areas where oil was not threatening the shore to prevent damage from the heavy equipment getting pushed into the delicate area by strong winds and high tides.

Underscoring his firm handling of BP’s role in the mop-up, Admiral Allen said that he had directed BP to "continue with the well shut-in procedure while the work to kill the well is temporarily suspended". He added he had insisted that BP take measures to ensure the vessels operating the remotely operated undersea vehicles were the last to leave the site and the first to return in order to maximise monitoring of the well. Monitoring of the site during the well integrity test remained one of the government's highest priorities, he said.

The administration said that while this latest response to avoid Bonnie would delay the effort to kill the well for several days, they were staging skimming vessels and other assets in a manner that would ensure that oil mitigation efforts were promptly re-started as soon as the storm passed and the safety of personnel was assured.

Biden visits again

Meanwhile Vice President Joe Biden made his second trip to the Gulf Coast since the oil spill began, on this occasion, meeting with Admiral Allen and other response personnel, inspecting boom and participating in a roundtable discussion with fishermen and small business owners.

In a statement after his visit, Mr. Biden said, "We’re not going to stop until this area, all the entire Gulf, has recovered; until the economy of the Gulf is revitalised and literally a way of life is restored. Because we’re not just talking about a natural ecosystem that’s in danger down here, we’re talking about an economic ecosystem. We’re also talking about a cultural ecosystem, a whole way of life," he said. "Whatever it takes to make this Gulf right, we’re going to make it right."

As per the administration’s data, to date 123,457 claims have been opened, from Americans who have suffered a financial loss as a result of the BP oil spill. Of this, the administration said, more than $234.9 million has been disbursed and no claims have been denied to date.

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Thursday, July 22, 2010

 

BP admits photographs doctored


From The Hindu

BP has further added to the tally of public relations disasters following the Gulf of Mexico oil spill. On Wednesday, allegations yet again emerged that the oil giant had doctored photographs showing a series of vessels working on the sea surface of the ruptured well.

In the third such allegation of photograph-doctoring The Gawker website said it had received a tip-off about a BP photograph taken from inside a helicopter which, while it suggested the helicopter was in the air above the sea, was actually a shot taken from a static, grounded helicopter on the deck of a vessel at the spill site.

The Washington Post reported that BP spokesman Scott Dean had sent it the original photograph, which indicated that the photographer had “pasted in blue sea where the edge of the landing pad was showing”. Mr. Dean was also quoted as saying that the photographer had further adjusted colours and contrast so that the interior of the helicopter was brighter.

Major embarrassment

Reports suggested that while such attempts at doctoring the photographs were minor, “the embarrassment was major” as they came at a time when BP was embarking on a damage-control exercise to persuade the American public that it was being open and transparent.

In an earlier incident, BP had again effectively admitted to wrongdoing when a different blog website reportedly exposed a doctored image from BP’s Houston office. This showed “a technical team in front of a large projection screen [where] the image on the projection screen had been enhanced using Photoshop”.

The Post said in that case too, Mr. Dean also provided it with the original photograph, in which the screen appeared to be entirely white because of the light contrast with the rest of the room. The newspaper reported that Mr. Dean had said the photographer used “the colour saturation tool” to show “a clearer version of the same image on the projection screen”.

He further said that the altered helicopter and headquarters photographs would be “promptly taken down from the BP website”. He added that the original and altered versions would be placed on BP’s Flickr website so people can compare them.

The company is already under enormous pressure for social gaffes after its CEO Tony Hayward participated in a glitzy yacht race in the United Kingdom at a time when thousands along the Gulf coast were struggling to save their livelihoods in the wake of the oil spill.

Further the company received negative press regarding its alleged efforts to lobby for a prisoner transfer agreement between the governments of the U.K. and Libya, efforts that coincided with BP signing a major oil deal with Libya and the subsequent release of Abdel Baset al-Megrahi, accused in the 1988 bombing of Pan Am flight 103, from a Scottish jail.

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Wednesday, July 21, 2010

 

Methane, seepage detected but well tests to continue


From The Hindu

Leaking methane and a seep near the well of the damaged Deepwater Horizon rig will not come in the way of continued testing of the capping stack installed by BP last week, according to Admiral Thad Allen, National Incident Commander in charge of the response to the Gulf of Mexico oil spill.

In a statement, Admiral Allen said, “Yesterday I sent BP a letter stating that there were a number of unanswered questions about the monitoring systems they committed to as a condition of the United States government extending the well integrity test.” He added that over the weekend, a conference call between the federal science team and BP representatives was convened to discuss the “detection of a seep near the well and the possible observation of methane over the well.”

Noting that the federal science team had received the answers they were seeking and BP reiterated its commitment to monitoring and notification obligations., Admiral Allen said, “I authorised BP to continue the integrity test for another 24 hours and I restated our firm position that this test will only continue if they continue to meet their obligations to rigorously monitor for any signs that this test could worsen the overall situation.”

Seeking to allay fears that the testing period could force oil to seep into the rock surrounding the well, the Admiral said the federal science team had the ability to return to the safe containment of the oil “at any moment” on the surface. He noted that the team would continue closely monitoring the BP well until such time as the relief wells were completed and the main well was permanently killed.

According to reports, the initial closing of the containment cap’s valves was supposed to last 48 hours as a test to determine if the well was leaking elsewhere. However it has lasted four days.

Letter to Dudley

In yet another sternly-worded letter sent on Sunday to Robert Dudley, Chief Managing Director of BP, Admiral Allen said, “Given the current observations from the test, including the detected seep a distance from the well and undetermined anomalies at the well head, monitoring of the seabed is of paramount importance during the test period.”

He added that as a continued condition of the test, BP was required to provide as a top priority access and coordination for the monitoring systems, which included seismic and sonar surface ships and subsea ROV and acoustic systems.

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Friday, July 16, 2010

 

BP's new cap a success


From The Hindu

In a relatively rare Gulf of Mexico oil spill update coming directly from the White House, President Obama said “the new cap is good news” — a reference to the “capping stack” installed earlier this week, which has thus far improved the odds of a total mop-up.

In a statement, the President explained that scientists and external experts who “met through the night and continue this morning to analyse the data from the well integrity test” were seeking to determine whether they could safely shut in the well using the new cap without creating new problems, including further oil leaks in the sea floor.

Mr. Obama noted, “Either we will be able to stop the flow, or we will be able to use it to capture almost all of the oil until the relief well is done. But we’re not going to know for certain which approach makes sense until additional data is in.”

Touching upon the positive aspect of the latest development, the President added that even if a shut-in were not possible, the new cap and the additional equipment being placed in the Gulf would be able to contain up to 80,000 barrels a day “which should allow us to capture nearly all the oil until the well is killed”.

However, Mr. Obama also cautioned that “when the oil stops gushing, everybody feels like we’re done — and we’re not”. He said that the final solution to the problem was going to be the relief wells and getting that completed “but there’s no doubt that we have made progress as a consequence of this new cap fitting on, and that even if it turns out that we can’t keep the containment cap on to completely stop the oil, it’s going to allow us to capture much more oil and we’ll see less oil flowing into the Gulf”.

He added that there was still “a big job to do” in terms of skimming surface oil and better coordination on the ground along the shorelines. “There’s still going to be an enormous cleanup job to do, and there’s still going to be the whole set of issues surrounding making sure people are compensated properly, that the $20 billion fund is set up and is acting expeditiously,” Mr. Obama said.

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Thursday, July 15, 2010

 

Test on oil well back on track


From The Hindu

BP has announced that a critical test on the ruptured oil well in the Gulf of Mexico will proceed as planned after a hydraulic leak that had delayed the tests was fixed on Thursday.

Tests of the integrity of the well were said to be vital to establishing a total mop-up mechanism until the permanent solution — relief wells — are put in place. These tests were initially scheduled for July 13 following the installation of the latest cap — called a “capping stack” — on the Deepwater Horizon well. Yet they were postponed because of the leak and also due to the need for further checks on the testing procedure.

In particular, Admiral Thad Allen, National Incident Commander in charge of the spill response, said in a briefing on July 14 that the test was rescheduled to start after a day’s delay during which time the procedure had been reviewed by a team of scientists from BP, other companies and the government.

“We sat long and hard about delaying this test,” he said, adding that it was in the interest of the American people, the safety of the environment and of the project to take a 24-hour break “to make sure we were getting this absolutely right.”

Reports quoted Kent Wells, Senior Vice President of BP as saying that overnight, engineers using remotely operated submersibles replaced equipment on the tight-sealing cap at the top of well, 5,000 feet under water. The reports added that with the repair made Mr. Wells said, “We’re looking to start this test as soon as we possibly can.”

Meanwhile, commenting on the temporarily elevated rate of flow of oil into the Gulf, Admiral Allen said, “As you know our current flow rate projections are 35,000 to 60,000 barrels a day. We had intended by about this time to have 53,000 barrel a day capacity by bringing the Helix Producer online.”

“Robust containment strategy”

The Admiral added that he did not want to lose track of the fact that his team was following “a very robust containment strategy that was actually started in early June where we directed BP to come up with alternatives to increase redundancy and capacity related to the new flow rate numbers”.

He also said he would put in writing to BP the revised steps within the testing procedure, as decided through the multi-party consultations. He added, “Two of the very positive aspects that can come out of this… are an assessment of whether or not we can just cap the well at this point and the pressures can be maintained without damaging the wellbore or the casings.”

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Monday, July 12, 2010

 

BP presses on with capping stack instalment


From The Hindu

BP on Monday expressed optimism that its latest strategy to quell the oil leak into the Gulf of Mexico by installing a new cap on its ruptured wellhead was proceeding as per plan. According to National Incident Commander Thad Allen, this strategy could potentially contain the entire leak in a matter of days.

In a statement over the weekend BP said that following approval from Admiral Allen, it had begun replacing the existing lower marine riser package (LMRP) containment cap — the so-called “top hat” system — over the Deepwater Horizon’s failed blow-out preventer (BOP) with a new sealing cap assembly (the “capping stack”).

“Installation of the sealing cap is proceeding as planned,” BP added, noting that the Discoverer Enterprise vehicle had removed the LMRP cap and its flange, or connecting projection.

Simultaneously, the disaster response team said that skimming operations had been “doubled” at the well site. Skimming and other methods of removing oil assumed particular importance after it was learned that the process for deployment of the capping stack would paradoxically increase the amount of oil leaking temporarily.

Thus during the procedure, close to 60,000 barrels of oil per day are expected to be flowing into the Gulf of Mexico without any containment. To mitigate this heightened flow, Admiral Allen had earlier pressed BP operations chief Robert Dudley to use a third containment ship, the Helix Producer.

In addition to skimming off this interim excess flow of oil, Admiral Allen’s team said “favourable weather conditions allowed responders to conduct a successful controlled burn operation for the third consecutive day”. They added that to date the controlled burns had helped to remove more than 10.3 million gallons of oil from the water.

Relief wells

Meanwhile BP has continued digging relief wells, as a fail-safe option in case the containment caps should be unable to halt the oil gushing into the Gulf. The disaster response team reported over the weekend that “The drilling of relief wells continues… The Development Driller III has drilled the first relief well to a depth of 17,810 feet below the Gulf surface. The Development Driller II has drilled the second relief well to a depth of more than 15,900 feet below the surface.”

BP shares trading higher

BP also issued an update on the cost to the company efforts to mop up the spill. In a statement, the oil major said, “The cost of the response to date amounts to approximately 3.5 billion dollars, including the cost of the spill response, containment, relief well drilling, grants to the Gulf states, claims paid, and federal costs.” Yet BP’s shares were trading almost seven per cent higher on Monday, as rumours of the company planning an asset sale worth $100 million abounded, as did rumours that other oil giants, such as ExxonMobil were considering buying out the beleaguered BP.

However, even as the administration and BP continue to battle the leak, which began in late April, a presidential commission charged with investigating the spill and prescribing rules for future offshore drilling held its first public meeting on Monday, media reports said. According to CNN, “The National Oil Spill Commission has six months to determine what happened… and how to prevent something similar from ever happening again.”

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Tuesday, July 06, 2010

 

BP deploys “A-Whale” to skim off oil


From The Hindu

Even as British Petroleum (BP) announced that it would deploy the world’s biggest skimmer to mop up oil from the Gulf of Mexico — an enormous ship named “A-Whale” — the fingerprints of the oil spill from its Deepwater Horizon rig were detected in tar balls that washed ashore in parts of Texas.

The A-Whale, a super tanker, will be used to “suck” or “swallow up” the slimy oil-water mix that has spread across vast areas of the Gulf. Subsequently, the ship will separate the oil from the water and return the water to the sea. According to reports, the A-Whale is capable of processing 21 million gallons (500,000 barrels) of oil-slicked water a day.

The last one week has reportedly seen smaller skimmers and other methods of mopping up the spill being slowed down by choppy seas and strong winds from Hurricane Alex.

The super tanker is currently undergoing several tests north of the Deepwater Horizon rig, BP’s oil well that exploded in April causing this environmental disaster. Yet bad weather has, according to reports, rendered the results from an initial 48-hour testing period inconclusive.

As the Fourth of July long weekend drew to a close, fresh environmental concerns were also sparked in Texas as investigators discovered “very small tar balls in the surf, but not on shore”, according to official sources. In a statement, the unified command for the spill response said, “The tar balls were collected and sent to the lab to be tested where they were determined to be associated with the Deepwater Horizon oil spill.”

Officials noted that tar balls were collected from the Crystal Beach area of the Bolivar Peninsula of Texas over the weekend but said, “It is unclear how the material got to Texas.” Reports quoted Galveston Mayor Joe Jaworski as saying, “It is a very small amount of oil so that is inconsistent with the thought that our time has come and the oil has finally hit our shores. There may be another reason.”

Meanwhile, the unified command also reported continued progress in drilling relief wells despite the “elevated sea states”. Officials said the first relief well had been drilled to a depth of more than 17,700 feet below the Gulf surface and the second relief well, “a redundancy measure taken at the direction of the administration”, to a depth of approximately 13,900 feet below the surface.

Simultaneously, the administration continued to oversee BP’s processing of claims linked to the impact of the spill on local communities along the Gulf coastline. Government officials said, “To date, 95,387 claims have been opened, from which more than $147.2 million have been disbursed. No claims have been denied to date. There are 951 claims adjusters on the ground.”

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Sunday, June 20, 2010

 

Obama outlines oil spill ‘battle plan’


From The Hindu

In an indication of the depth of his administration's concern over the oil spill in the Gulf of Mexico, U.S. President Barack Obama on Tuesday spoke directly to the American people in a rare televised address from the Oval Office.

During the address, Mr. Obama not only underscored — as he has done repeatedly over the last few weeks — the various steps his government had taken to combat the disaster in the Gulf but also made the case for ending the United States' “addiction” to fossil fuel.

Outlining what he called his “battle plan” to tackle the consequences of the leak, Mr. Obama laid out three dimensions of his strategy: the clean-up operation, recovery and restoration of affected areas and persons, and ensuring that such a catastrophe never recurred.

In terms of the cleanup, Mr. Obama said that through the efforts led by Coast Guard chief Admiral Thad Allen, there were nearly 30,000 personnel working across four states to contain and clean up the oil. Over five-and-a-half million feet of boom had been laid across the water to block and absorb the approaching oil.

With regard to recovery and restoration of the Gulf Coast, Mr. Obama said he will not let the way of life of fishermen and other coastal residents be lost. He said he would direct the chairman of BP, whom he would be meeting on Wednesday, to “set aside whatever resources are required to compensate the workers and business owners who have been harmed as a result of his company's recklessness.” Mr. Obama added that this fund would not be controlled by BP but by an independent third party.

Mr. Obama emphasised on the steps being taking to ensure that “a disaster like this does not happen again.” A National Commission had been established to understand the causes of this disaster and recommend additional safety and environmental standards where needed.

He noted that he had also sought to reform the ailing Minerals Management Service, the agency responsible for regulating drilling and issuing permits. In part he hoped this would be aided by his decision to bring in new leadership at the agency in the form of Michael Bromwich, a “tough federal prosecutor and Inspector-General,” who has been charged with building an organisation that acted as “the oil industry's watchdog — not its partner.”

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Tuesday, June 15, 2010

 

Obama presses BP on compensation

From The Hindu

The Obama administration would finally appear to be waking up to the wave of anger over its slow reaction to the oil spill in the Gulf of Mexico. This week the President is set to turn up the heat on British Petroleum (BP) over the question of compensation. He also made his fourth trip to the worst-affected areas along the Gulf, this time in Mississippi, Alabama, and Florida.

Over the weekend, the White House joined with a growing public clamour for BP to set up an escrow account to provide compensation for the clean-up and to those affected by the slick.

On Sunday, David Axelrod, senior White House strategist, said on the NBC channel, “We want to make sure that money is escrowed for the legitimate claims that are going to be and are being made by businesses down in the gulf — people who have been damaged by this.”

Mr. Axelrod added that the administration wanted to ensure that the money would be independently administered so those who have suffered losses and would not be “slow-walked on these claims”.

According to reports quoting administration officials Mr. Obama will, in a speech from the Oval Office on Tuesday, outline a plan to legally compel BP to create an escrow account to compensate businesses and individuals for their losses.

Additionally the New York Times reported that White House officials were researching what legal authority the President had to compel BP to set aside money for claims, based on the 1990 Oil Pollution Act.

Last week in a conversation with British Prime Minister David Cameron Mr. Obama noted that “BP must do all it can to respond effectively to the situation.” The White House had also warned BP that it had until the end of the weekend to speed up efforts to contain the oil spill.

The spill has so far seen over 1.7 million gallons of oil polluting the Gulf daily. Ever since the BP-operated Deepwater Horizon rig exploded and killed 11 workers in late April, there have been increasingly vociferous calls for President Obama to stop being soft on the oil major.

While BP has accepted responsibility for the massive leak it has failed to halt the flow thus far and has also been slow to come up with funds for compensation for environmental damage and loss of incomes along the Gulf coastline.

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Friday, June 11, 2010

 

Oil spill estimate doubled


From The Hindu

In what might be the most serious setback to date in the Gulf of Mexico oil spill crisis, scientists have suggested that the rate at which the spill is growing could be double the original estimation.

Marcia McNutt, United States Geological Survey Director and leader of the Flow Rate Technical Group (FRTG) monitoring the spill, said the best estimate for the average flow rate of the leak could be as high as 40,000 barrels per day.

If indeed the true flow rate is 40,000 barrels per day, it would imply that 1.7 million gallons of oil have been flowing daily out of the ruptured well of the British Petroleum-owned Deepwater Horizon offshore rig.

The rig exploded on April 22, killing 11 people, and has been spewing out vast amounts of oil into the Gulf since then. It has already caused extensive damage to marine life and eroded the incomes of those dependent on it, particularly in Louisiana where the oil slick has swamped the state’s fragile coastal marshlands.

Researchers had earlier estimated the amount of oil escaping into the Gulf at between 12,000 and 19,000 barrels — 504,000 to 798,000 gallons — per day. During the most recent attempt to halt and divert the flow, by cutting well’s riser pipe and placing a cap on the well, the experts had said that the rate flow had increased by 4 to 5 per cent.

The latest estimates were, according to Dr. McNutt, based on “additional video that BP was directed to provide” and calculated the lower and upper bound range estimates for a period of time before the Riser Insertion Tube Tool was inserted and before the riser was cut. The scientist team further cautioned that the estimates depended on “limited data available and the small amount of time to process that data”.

Meanwhile BP reported on the containment process currently underway, which has entailed the use of a lower marine riser package (LMRP) containment cap to collect oil and gas flowing from the MC252 well and transport them to the Discoverer Enterprise drillship on the surface.

In an update the company said, “In the first 12 hours of June 9 (midnight to noon), approximately 7,920 barrels of oil were collected and 15.7 million cubic feet of natural gas were flared. On June 8, a total of approximately 15,000 barrels of oil were collected and 29.4 million cubic feet of natural gas were flared.”

BP continues to face pressure from the Obama administration to not only halt and mop up the leak but also compensate fishermen and others along the Gulf coastline for loss of income. On Thursday it announced a second round of block grants of $25 million each to the states of Florida, Alabama and Mississippi.

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