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Gulf of Mexico Oil Spill (2010)

Business  (tags: BP, oil spill, Gulf oil spill, disaster, oil, news, business )

- 3240 days ago -
The Latest on the Oil Spill Compensation to Victims The House of Representatives voted on July 1 to increase the compensation that can be received by families of those killed or injured in the April 20 explosion of the Deepwater Horizon drilling rig.


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Dave K (308)
Sunday July 4, 2010, 1:26 am
Updated: July 2, 2010

The Latest on the Oil Spill

Compensation to Victims

The House of Representatives voted on July 1 to increase the compensation that can be received by families of those killed or injured in the April 20 explosion of the Deepwater Horizon drilling rig. The measure would repeal a limitation on the liability of vessel owners to the value of the ship and its cargo. While families of the 11 killed and the 17 injured would benefit under the legislation, the bill would also apply to all companies operating on the high seas, according to a statement issued by Speaker Nancy Pelosi, Democrat of California, after the legislation passed by voice vote.


A federal lawsuit filed by several wildlife-protection groups contends that BP's practice of burning off spilled oil in the Gulf of Mexico is probably killing endangered sea turtles. The suit, filed on June 30 by the Animal Welfare Institute and other groups, asks Judge Carl Joseph Barbier of Federal District Court in New Orleans to restrict BP's "controlled burns" of oil. The plaintiffs contend that turtles are caught in the gathered oil and unable to escape when it is set ablaze. Judge Barbier is scheduled to hear arguments on July 2 on the groups' request for a temporary restraining order on controlled burns. Mark Proegler, a BP spokesman, told The Associated Press that the company had tried to avoid burning turtles by using crews in boats to look for them before oil was set afire.

Compensation Fund Payments

The director of the fund set up to compensate victims of the spill said on July 1 that businesses would be able to apply for emergency lump-sum payments. Kenneth R. Feinberg, who was appointed by President Obama to oversee the $20 billion escrow fund set up by BP, said payments would be speeded up and would no longer have a predetermined limit.

An explosion on April 20 aboard the Deepwater Horizon, a drilling rig working on a well for the oil company BP one mile below the surface of the Gulf of Mexico, has led to the largest oil spill in American history. After a series of failed efforts to plug the leak, government and company officials say oil will likely continue flowing until a relief well cuts off the gusher, an event expected sometime in August.

The government estimated that between 12,000 and 25,000 barrels a day of oil were escaping, then adjusted the estimate to a rate of 25,000 to 30,000 barrels a day.

On June 15, the government raised its estimate of the oil flow rate yet again, declaring that as much as 60,000 barrels of oil could be flowing into the Gulf every day.

A barrel of oil holds 42 gallons, so an amount equivalent to the Exxon Valdez disaster could be flowing into the Gulf of Mexico every four days.

The latest estimate reflects a possible increase in the flow rate that occurred after BP cut an underwater pipe called a riser on June 3 to install a containment cap to capture part of the oil. The cap began collecting 15,000 barrels of oil a day, and a second containment system was installed on June 16.

Up to the end of May, most of the oil making landfall from the distaster was in Louisiana. But in June, tar balls and oil mousse began to reach the shores of Mississippi, Alabama and Florida.

The Coast Guard commander, Adm. Thad W. Allen, said on June 7 that it could take years to deal with the effects of the spill, in part because it had broken into hundreds of thousands of patches.

On June 1, the Justice Department announced that it would begin a criminal investigation of the spill, to determine if any of the parties involved BP, which was leasing the rig, which made it liable for the spill's damage; Transocean, which owned the rig; and Halliburton, which was involved in the effort to seal the well that preceded the blast had violated environmental laws. Congressional investigators were told of sharp conflicts in the hours before the blast, which killed 11 workers, over how to handle the capping of the well, and uncovered evidence of missed warning signs. An internal memo showed that BP had chosen the cheaper of two methods of capping, despite worries about the risks involved.

As the weeks dragged on and BP failed repeatedly to plug the leak, the spill grew into a major political challenge for President Obama. It upended the debate on his proposal in March to expand offshore drilling he halted virtually all drilling projects in late May and seemed to derail a bipartisan attempt at energy and climate legislation in the Senate. The spill and its aftermath also brought to light the enduring laxity of federal regulation of offshore operations and led to plans to revamp the branch of the Interior Department responsible.

The Deepwater Horizon was described before the accident as one of the most technologically advanced drilling platforms in the world. The rig had drilled a well in the sea floor and was in one of the last phases of the operation, building a cement casing to reinforce the well. Workers from the rig and company officials have said that hours before the explosion, gases were leaking through the cement. The rig was owned by Transocean and had been leased to BP; it was being operated by Transocean and the cement work was being done by Halliburton. All three companies have sought to deflect blame onto the others.

The size of the leak was at first estimated at about 1,000 barrels of oil a day. On April 28, government officials said there were three leaks and the well was spilling over 5,000 barrels of oil a day - over 200,000 gallons - nearly a mile below sea level, but scientists and environmental groups raised sharp questions about that estimate. On May 27, government scientists presented a new range of estimates, from 12,000 to 25,000 barrels a day. Soon after, the estimate was raised to 25,000 to 30,000 barrels of oil a day. On June 15, the government declared that as much as 60,000 barrels a day could be spewing into the Gulf.

Leaks from wells are supposed to be blocked by devices called blowout preventers. The blowout preventer in the BP well could not be turned on at the time of the blast, and attempts to use submersible vehicles to activate it also failed. BP then constructed a 90-ton containment dome, which it lowered onto the leak in the hope of funneling the oil up through a pipe. The dome became clogged with ice, as did a smaller "top hat'' tried next. On May 17, BP officials said they had succeeded in inserting a mile-long, 4-inch wide tube into the 21-inch-wide burst pipe, siphoning off a little more than 1,000 barrels a day. On May 26, BP engineers began a "top kill,'' pumping thick drilling mud into the leak at high pressure in the hope of clogging it long enough for a cement cap to be installed. That failed, and was followed by a new version of a containment cap, adapted to avoid the ice that stymied the first one. It was lowered in place with four vents open, and when only one was closed it was already capturing more oil -- 15,000 barrels a day -- than could be siphoned into a nearby ship.

On June 16, BP began collecting crude oil from a second containment system to help stem the thousands of barrels escaping from their damaged well.

Initially, the Coast Guard and the oil company worked to contain the slick within booms and succeeded in burning small amounts of oil. The slick spread mainly to the south and east, and by mid-May it was beginning to enter the loop current that steers Gulf waters toward Florida. Shortly thereafter it began to hit shore, smearing tourist beaches, washing onto the shorelines of sleepy coastal communities and oozing into marshy bays that fishermen have worked for generations. It announced its arrival on the Louisiana coast with a fittingly ugly symbol: brown pelicans, the state bird, dyed with crude.

The Explosion

Information coming from a variety of sources about the events that led up to the blast paint a picture of a complex operation that went awry just as it was drawing to a close.

Drilling logs from the Deepwater Horizon suggest that shortly after midnight on the morning of the explosion, attention had turned to temporarily plugging and capping the well so the rig could disconnect and move to another job. Halliburton, the contractor hired by BP to provide cementing services, had spent the past several weeks cementing each new segment of the well into place. Halliburton was also responsible for plugging it.

BP and Congressional investigators have raised questions about the cementing, suggesting that the seal might have been faulty and failed to keep gas from rising up in the well. According to BP, the cement work took longer than normal, and there were concerns that the quality of the cement might have been compromised by contamination with mud. Halliburton executives have said that the company adhered strictly to the specifications provided by BP for the cementing of the well.

Two hours before the explosion, an early pressure test of the cement was performed incorrectly and produced unacceptable results. The test was repeated and there was an "indicator of a very large abnormality," BP's investigator told a Congressional committee, adding that workers might have made a "fundamental mistake" in ignoring it. Shortly before 8 p.m., two hours before the explosion, workers were "satisfied" that the test was successful, according to BP's investigation. The decision was then made to begin withdrawing the drilling mud, a cocktail of clay, water and minerals used to keep downward pressure on the powerful fountain of oil and gas trying to push its way up out of the tapped reservoir.

In the final hour before the explosion, after the crew had begun withdrawing the mud, there were more signs that the well was going out of control, the memo said. They included a sharp increase in fluid coming from the well, even when the pumps were shut down - an indication, drilling experts say, of a "kick," a surge in pressure from oil and gas deep down in the well. If not controlled, such a kick can lead to a full-scale blowout, and that is exactly what happened at roughly 9:49 p.m.

The Government's Response

From the beginning, the response effort has been bedeviled by a lack of preparation, organization, urgency and clear lines of authority among federal, state and local officials, as well as BP.

On April 29, Mr. Obama announced that the federal government would get involved more aggressively in fighting the spill, and Homeland Security Secretary Janet Napolitano designated the spill as "of national significance.''

Interior Secretary Ken Salazar, who early in the crisis vowed to "keep the boot on the neck" of BP, threatened to push the company out of the way. But Mr. Salazar soon backed off, conceding to the reality that BP and the oil companies have access to the best technology to attack the well. The government's role, he acknowledged, is largely supervisory and the primary responsibility for the spill, for legal and practical reasons, remains with the company.

The White House said that the government would not allow any new offshore drilling until an investigation was conducted into the spill and whether it could have been prevented. But the Interior Department continued to issue permits and waivers for drilling projects in the gulf that were already underway, leading critics to say the ban was being interpreted too narrowly.

On June 22, U.S. District Judge Martin Feldman in New Orleans overturned the six-month moratorium on new deepwater drilling projects. He said that the Interior Department failed to provide adequate reasoning for the moratorium. The White House swiftly vowed to appeal the ruling.

The White House announced on June 1 it would open civil and criminal investigations into the oil spill. Attorney General Eric H. Holder Jr. said he planned to "prosecute to the fullest extent of the law" any person or entity that the Justice Department determines has broken the law in connection with the oil spill. BP has said it will cooperate fully with any inquiry, which may also extend to Transocean, Halliburton or Cameron, the company that manufactured the "blowout preventer" that failed to function after the explosion.

The announcement of a criminal investigation came the same day that Mr. Obama insisted that the government and the industry find a way to make offshore drilling safe in order to keep up with the country's demand for oil. Charged with this obligation are former Senator Bob Graham of Florida, a Democrat, and a former Environmental Protection Agency administrator, William Reilly, a Republican, both of whom Mr. Obama appointed to lead the inquiry into the spill.

Mr. Obama returned to the Gulf Coast on June 14, his fourth trip to the region since the spill began. On June 15, he gave his first Oval Office speech, in which he used the crisis to press for sweeping change in energy policy. He also appointed former Mississippi Governor Ray Mabus as long-term recovery coordinator and demanded that BP set up a multibillion-dollar escrow account to compensate the victims.

The following day, top executives of BP went to the White House and agreed to create a $20 billion fund to pay claims for the spill. The fund will be independently run by Kenneth Feinberg, the mediator who oversaw the 9/11 victims compensation fund.

BP also said it would not pay further dividends to shareholders this year.

Mr. Obama completed the deal for the escrow fund in a private, 25-minute session with BP's chairman, Carl-Henric Svanberg. Mr. Svanberg told reporters that BP cares about "the small people." The comment set off an immediate uproar in the blogosphere and elsewhere from people who said it showed BP's indifference to those harmed by the spill.

Mr. Hayward and other BP executives have faced harsh questioning from Congress, and oil company executives speaking at a Congressional hearing publicly blamed BP for mishandling the well that caused the disaster.

Representative Edward J. Markey, the chairman of the House Energy and Environment Subcommittee, released an internal BP document on June 20 showing that the company's own analysis of damage to the well bore resulted in a worst-case estimate of 100,000 barrels of oil leaking into the Gulf of Mexico each day. Mr. Markey said the document provided a sharp contrast to BP's initial claim that the leak was just 1,000 barrels a day.

Impact on Energy Policy

The spill has had repercussions away from the water as well. The deadly explosion and the resulting spill have complicated Mr. Obama's plans to expand offshore oil and gas drilling, and may have doomed a bipartisan energy bill in the Senate in 2010, as its one Republican supporter, Lindsey Graham of North Carolina, said the spill would make it impossible to pass. And Mr. Obama announced plans to split the Minerals Management Service, the agency that oversees offshore oil drilling, into two parts, one to inspect oil rigs and enforce safety and the other to oversee leases for drilling and collect royalties.

More than a decade ago, federal regulators warned offshore rig operators that they needed to install backup systems to control the blowout preventers, and repeated the warnings in 2004 and 2009. Yet the Minerals Management Service, an Interior Department agency, never took steps to comprehensively address the issue, relying instead on industry assurances that they were on top of the problem.

The political ripples from the accident spread as six West Coast senators proposed a permanent ban on drilling in the Pacific and another group tried to raise oil company liability in a spill to $10 billion from the current $75 million.

On May 27, Mr. Obama ordered a halt to virtually all current and new offshore oil drilling activity pending a comprehensive safety review. He acknowledged that oversight had been seriously deficient, but said that offshore drilling would have to remain a part of the nation's sources of energy for at least the near future.

Mr. Obama began a push for action on energy legislation, hoping to capitalize on growing public anger toward BP and other oil companies. He called for rolling back Bush-era tax breaks for energy companies, and directing the funds toward clean energy research.

In his Oval Office speech on June 15, Mr. Obama made the case that the spill justifies his plans for energy and climate change legislation, a way of turning a political burden into a political weapon. He called on Americans to "seize the moment" to "end America's century-long addiction to fossil fuels."

Republicans quickly accused Mr. Obama of capitalizing on the leaking oil to pass a bill that otherwise seemed stalled.


BP also clashed with the federal government over its use of dispersants, chemicals sprayed on the spill that were meant to break up the oil in the hope that it would settle to the bottom. In a novel approach, BP has been spraying dispersants on the oil as it leaves the well head to reduce the amount that reaches the surface.

The Environmental Protection Agency directed the company to stop using two dispersants from a line of products called Corexit and switch to something less toxic. The oil company defended its use of Corexit and taken issue with the methods the agency used to estimate its toxicity, and continued to spray the chemicals past the E.P.A. deadline.

The E.P.A. administrator, Lisa P. Jackson, said that she had ordered the oil giant to take "immediate steps to scale back the use of dispersants." She said the amount of chemicals applied to control the oil spilling from the Deepwater Horizon well - more than 700,000 gallons so far on the gulf's surface and a mile underwater at the leaking well head - was "approaching a world record."

Blowout Preventers

After the explosion, investigators focused on the failure of a component on the well's blowout preventer that is supposed to close off a well spewing out of control. The device, called a blind shear ram, is the only part of the blowout preventer that can completely seal the well. Minutes after the explosion, at least one rig worker hit an emergency button, which is supposed to trigger the blind shear ram within about 30 seconds, and then disconnect the rig from the well. But the blind shear ram never fully deployed.

An examination by The New York Times highlights the chasm between the oil industry's assertions about the reliability of its blowout preventers and a more complex reality. It reveals that the Minerals Management Service, repeatedly declined to act on advice from its own experts on how it could minimize the risk of a blind shear ram failure.

It also shows that the Obama administration failed to grapple with either the well-known weaknesses of blowout preventers or the sufficiency of the nation's drilling regulations even as it made plans in March to expand offshore oil exploration.

Records and interviews show that blind shear rams can be surprisingly vulnerable. There are many ways for them to fail, some unavoidable, some exacerbated by the stunning water depths at which oil companies have begun to explore.

They also can be rendered powerless by the failure of a single part, a point underscored in a confidential report that scrutinized the reliability of the Deepwater Horizon's blowout preventer.

These kinds of weaknesses were understood inside the oil industry, documents and interviews show. And given the critical importance of the blind shear ram, offshore drillers began adding a layer of redundancy by equipping their blowout preventers with two blind shear rams.

But neither Transocean nor BP took steps to outfit the Deepwater Horizon's blowout preventer with two blind shear rams. In a statement, BP pointed to the need for the rig to carry its blowout preventer from well to well.

The Struggle Underwater

For weeks BP tried without success to reactivate the seal-off valves on the dead blowout preventer. Then it lowered a 40-foot steel containment chamber in an effort to funnel escaping oil to a ship on the surface, but that failed when an icy slush of gas and water stopped up the device.

After that, BP attached a mile-long tube into the leaking well designed to divert oil to a drill ship before it leaked into the gulf. But the company said the rate it has been able to capture has varied from day to day, between 1,360 and 3,000 barrels, far below even the most conservative estimates of how much oil was leaking. By the one month mark, by the government and the company's conservative estimates, at least 7 million gallons of oil had spilled, putting the incident in the same league as the 11 million gallons spilled by the Exxon Valdez.

In a maneuver called a "top kill," BP planned to pump heavy drilling fluids twice the density of water through two narrow lines into the blowout preventer to plug the runaway well. However, this tactic, though initially promising, failed when it became clear that the pressure of oil and gas escaping from the well was simply too powerful to overcome. With this disappointment, BP and government officials on June 1 announced they had abandoned efforts to plug the leaking well. Instead, their efforts would focus on trying to siphon the leaking oil and gas to the surface until relief wells can stop the flow, most likely not before August.

The new effort involved "containment cap,'' a revised version of the containment dome that failed because of ice that clogged it. BP engineers used submersible robots to cut off a portion of the pipe the oil was gushing through to give the cap a better target to fit over, and pumped antifreeze down into the space to try to prevent ice buildup. They eased the cap in place, and slowly began closing vents that had been left open to minimize pressure that might lift it off. By June 5, officials reported that they were siphoning off as much as 10,000 barrels a day, even with only one of four vents closed. That estimate was lifted to 15,000 barrels two days later, which was all the oil that the ship receiving the flow could handle.

BP on June 16 began collecting crude oil from a second containment system. The oil is siphoned through a series of pipes and hoses to a ship, the Q4000, which will then clean and burn the oil and gas mixture in a processing device called an EverGreen burner.

The containment effort suffered a setback on June 23 when a discharge of liquid and gases forced the company to temporarily remove the cap. By evening, the cap was back on, nestled in place on the eighth try after about 90 minutes of effort. Before the problem, the containment cap system had collected about 27,097 barrels of oil in the previous 24 hours.

Mack David (100)
Sunday July 4, 2010, 1:28 am
Article: :-(
you: :-)

Teresa W (782)
Sunday July 4, 2010, 3:05 am

. (0)
Sunday July 4, 2010, 5:06 am
noted~ Thanks Dave!!

Pier Luca F (18)
Monday July 5, 2010, 1:21 pm

Mary Donnelly (47)
Monday July 5, 2010, 3:08 pm
Thanks Dave. Similar to many factors in this oil spill, these things are taking too long to evenuate.

Carole Cherne (35)
Monday July 5, 2010, 4:52 pm
Thanks for the information.

Teresa K (33)
Monday July 5, 2010, 4:57 pm
Noted and thanks.

Matloob ul Hasan (81)
Monday July 5, 2010, 7:45 pm
Noted, thanks.

Debra Hanna (1)
Monday July 5, 2010, 9:36 pm
Thanks for sharing, I will share with my family, and friends.

Julia Rose (0)
Monday July 5, 2010, 10:20 pm
this is horrible.

Dalia H (1280)
Monday July 5, 2010, 10:22 pm
Noted my Beloved Dave. Thank You so much for sharing with Us.
Much Love,

Nightcat Mau (81)
Tuesday July 6, 2010, 2:08 am
Noted and thanks. But no amount of money will make up for the loss of a loved one. It will at least help the living pay for funerals and bills left behind.

KS Goh (0)
Tuesday July 6, 2010, 4:52 am
Thanks for the article.

David R (45)
Tuesday July 6, 2010, 7:11 am
noted, thanks a lot for posting!

Henry Nguyen (1)
Tuesday July 6, 2010, 9:51 am
Noted and thanks. But no amount of money will make up for the loss of a loved one. Government shoul make BP's top officer pay for this and the crime the did to people and environment.

Dave K (308)
Tuesday July 6, 2010, 9:59 am
Henry you are right -- I agree that until they start locking these people up for ten years and more this corruption will not stop. Why would it stop when they literally get away with murder? And this will be a decades long disaster for the coastal communities, not to mention the living creatures in and around the waters. This is a disaster of unimaginable magnitude.

Arielle S (313)
Tuesday July 6, 2010, 10:51 am
A wealth of information - great post - thank you!

Tuesday July 6, 2010, 3:02 pm
Thanks Dave. Money is the problem, not the solution.

Liliana D (125)
Tuesday July 6, 2010, 8:38 pm
Noted, great post. Thanks Dave.

Tuesday July 6, 2010, 8:47 pm
noted and tweeted, thanks!!
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