Some oil spill events from Monday, July 19, 2010

Some oil spill events from Monday, July 19, 2010

A summary of events Monday, July 19, Day 90 of the Gulf of Mexico oil spill that began with the April 20 explosion and fire on the drilling rig Deepwater Horizon, owned by Transocean Ltd. and leased by BP PLC, which is in charge of cleanup and containment. The blast killed 11 workers. Since then, oil poured into the Gulf from a blown-out undersea well until BP managed to stanch the leak Thursday — at least temporarily — with a massive cap.

CAP ON

The federal government Monday allowed BP to keep the cap shut tight on its ruptured Gulf of Mexico oil well for another day despite reports of an area where oil or natural gas may be rising from the sea floor. The Obama administration’s point man for the spill, retired Coast Guard Adm. Thad Allen, said early Monday that the company promised to watch closely for signs of new leaks around the mile-deep well, which has stopped gushing oil into the water since the experimental cap was closed Thursday. On Sunday, he had demanded increased monitoring. The concern all along — since pressure readings on the cap weren’t as high as expected — was a leak elsewhere in the well bore, meaning the cap may have to be reopened to prevent the environmental disaster from becoming even worse and harder to fix.

COST

BP said Monday that the cost of dealing with the oil spill has now reached nearly $4 billion. The company said it has made payments totaling $207 million to settle individual claims for damages from the spill along the Gulf coast of the United States. To date, almost 116,000 claims have been submitted and more than 67,500 payments have been made, totaling $207 million.

DISAGREEMENT

With the newly installed cap keeping oil from BP’s busted well out of the Gulf during a trial run, this weekend offered a chance for the oil company and government to gloat over their shared success — the first real victory in fighting the spill. Instead, they spent two days disagreeing over what to with the undersea machinery holding back the gusher. The apparent disagreement began to sprout Saturday, when Allen said the giant stopper would eventually be hooked up to a mile-long pipe to pump the crude to ships on the surface. But early the next day, BP chief operating officer Doug Suttles said the cap should shut the oil in until relief wells are finished.

FEINBERG

The administrator of a $20 billion Gulf oil spill compensation fund offered a hard sell Monday, promising fishermen and others with lost income claims from the disaster that he’ll be more generous with them than any court would be. Kenneth Feinberg noted that claimants are free to instead file a lawsuit, adding that they’d be crazy to do so because this would give them the money without waiting for years and paying lawyers. Feinberg made the comments in a speech to the Economic Club of Washington, D.C., but his target audience included people and businesses who have suffered economic harm in the Gulf Coast area. He sounded like a TV pitchman, reminding them they were under “no obligation” to waive their rights to sue, unless and until they decide to accept a lump sum for all present and future injury.

RICO

Using a law originally enacted to combat the Mafia, attorneys are filing lawsuits accusing BP PLC and Transocean Ltd. of committing a long-term series of crimes by concealing flaws in deepwater drilling plans and lacking safeguards to contain a catastrophic Gulf of Mexico spill. BP has been named in at least three lawsuits brought under the federal law known as RICO, for Racketeering Influenced and Corrupt Organizations. Transocean, which leased the ill-fated Deepwater Horizon drilling rig to BP, has been named in two. The lawsuits accuse both companies of committing wire and mail fraud over a number of years by filing false documents with the U.S. government, and by misleading investors through other documents and falsehoods. They also allege an overall oil and gas industry effort to “infiltrate” federal regulators through favors such as alcohol and drugs, sex, golf and ski trips, concert and sports tickets.

FORECASTERS

Call it cloudy with a chance of tar balls. TV forecasters along the Gulf Coast have been trying to predict the path of oil spewing from the Deepwater Horizon rig. But that’s proving more difficult than predicting sunshine or showers. Forecasters began adding the slick to the outlook soon after the Deepwater Horizon rig exploded in April, but their initial success was spotty. The oil didn’t move as quickly as meteorologists predicted, and residents in some areas like the Florida Panhandle spent days anticipating oil before it appeared. Even though BP PLC cut off the oil flow for the first time last week, forecasting oil’s landfall will remain a challenge for months as the sticky stuff continues to wash up.

FEEDING FISHERMEN

Grow up on the water, the children of southern Louisiana learn, and you’ll never go hungry. As long as you can toss a line, a net or a trap, you can eat — and eat well. Or you could, until now. Millions of gallons of oil from the April 20 explosion of the Deepwater Horizon rig have fouled some of the world’s richest fishing grounds from Florida to Texas. Even though BP stopped the leak for the first time Thursday, more than a third of the Gulf of Mexico remains closed. For thousands who feed their families from the water, what once seemed like a never-ending, free buffet of high-protein, low-fat shrimp, crabs, oysters and fish is off limits. It’s not that people are starving. With compensation checks from BP and the help of charities such as Second Harvest Food Bank, they’re able to stock their pantries with staples — rice and beans, grits and cereal, peanut butter and jelly. But they’re forced to pay for protein they used to get for free. And not the kind they want.

BP

Shares of BP fell Monday after it said the tab for the Gulf of Mexico oil spill is nearing $4 billion while it monitors oil or gas seeping near the ruptured well. BP PLC’s shares lost $1.61, or 4.3 percent, at $35.49 in midday trading. Investors remain worried about the mounting costs and whether the latest fix will hold until a relief well is in place, Argus Research analyst Phil Weiss said. The cost of dealing with the oil spill — almost $4 billion — equals about two-thirds of BP’s profit in the first three months of the year.