BP Permanently Plugs Oil Leak; Talks of the Days Ahead, Focus Reports
Release Date: 2010-09-24
On September 19th, British oil and gas giant BP announced the success of a MC252 Relief Well in the Gulf of Mexico, putting a permanent end to what is considered the most prodigious oil spill in United States history. Oil had been flooding the Gulf at a startling rate since April 20th, when BP’s Deepwater Horizon rig underwent an explosion. Government estimates allege that approximately five million barrels were spilled.BP’s American Chairman and President, Lamar McKay, said in a prepared statement that relief operations on what the company has dubbed the “Macondo” well represent a “significant technological accomplishment;” BP Chief executive Tony Hayward lauded the “complex and unprecedented subsea operation.” BP attempted several failed efforts to enclose or siphon the effusive stream of oil, including the use of a large containment dome, and pumping thousands of barrels of mud into the leak site. Ultimately, only the rather lengthy process of drilling relief wells was able to halt the outflow. The strategy allowed engineers to pump cement into both the casing and the annulus of the MC252 well. Pressure tests confirmed that the operation was successful, and BP will now abandon the wells, following customary industry practices.
Hayward said that the well itself “no longer presents a threat to the Gulf of Mexico.” However, with so much oil spilled, Hayward readily acknowledges that “there is still more to be done.” McKay concurs, stating, “BP remains committed to remedying the harm that the spill caused to the Gulf of Mexico, the Gulf Coast environment, and to the livelihoods of the people across the region.”
Since the spill, oil has gradually made its way from the leak site to surrounding waters, first reaching prevalent fishing areas, and eventually making landfall and washing up on beaches and coastlines throughout surrounding states, including Louisiana, Mississippi, Alabama, and Florida. Many residents, especially those involved in the tourism and fishing industries, were adversely affected. The U.S. government has mandated that BP make every effort to clean up the oil, and compensate victims.
BP set up a $20 billion fund in escrow, to be paid to residents claiming monetary damages. However, incoming CEO Bob Dudley, who is to replace Hayward in October, noted that it appears that the 20 billion “exceeds calls.” Many scientists have now asserted that the damage from the spill in the short term, while substantial, is not as extensive as initially thought. Most of the surface oil, at least, has been cleaned or has dissipated. While the long-term effects of the spill are still unclear, this news comes as some small relief. Nonetheless, Dudley forecasts that the disaster will cost BP an approximate $32 billion—for the damages payments to individuals and companies, and also for relief and cleanup operations.
BP is the third largest energy company in the world, and one of six oil and gas ‘supermajors,’ as measured by revenues. Its largest division is BP America, headquartered in Houston, Texas. It is carefully planning future drilling plans.
| Type: | NORMAL |
| Company: | Focus Reports |
| Country: | Switzerland |