By Jessica Resnick-Ault and Jim Polson May 28 (Bloomberg) — BP Plc resumed pumping thousands of barrels of mud into a damaged oil well in a bid to halt a Gulf of Mexico oil spill that is bigger than the Exxon Valdez disaster and may be the largest in U.S. history. The attempt, known as a “top kill,” restarted at 7 p.m. New York time yesterday, U.S. Coast Guard Chief Bob Laura said by telephone from the spill Joint Information Center in Robert, Louisiana. The effort, begun May 26, was suspended the same day at 11 p.m. for checks and to make some changes to the procedure. “What we do believe we’ve done is successfully pump some drilling mud into the well bore,” Doug Suttles , BP’s chief operating officer for exploration and production, said yesterday at a press conference in Robert. BP will keep pumping the mud for another 24 to 48 hours, he said. “We will continue the efforts as long as there’s a possibility of success.” A successful top-kill would bring a temporary end to a leak that has poured an estimated 23 million gallons of oil into ocean and soiled 100 miles (161 kilometers) of coast. The slick stemming from a fatal April 20 drilling rig explosion threatens the Gulf fishing and tourism industries and has so far cost BP $850 million. “It will be Friday night or Saturday at the earliest before we know definitively that the well has been killed,” Robert MacKenzie , a Houston-based analyst for FBR Capital Markets, wrote yesterday in a note to clients. Exxon Valdez The well has been leaking oil at an estimated rate of 12,000 to 19,000 barrels a day, Marcia McNutt, head of a U.S. government panel studying the flow, said yesterday. At the midpoint of that rate, the well has exceeded the 262,000 barrels spilled by the Exxon Valdez in 1989 and the U.S. record 300,000-barrel spill by a tanker off the Oregon coast in 1968, according to statistics from the American Petroleum Institute . The company will inject material originally intended for another well-blocking solution known as a “junk shot.” Adding the items to the mud may help BP to seal leaks so that enough pressure can be exerted on the column of oil to block the flow. Some of items are fibrous and small, and others are larger rubber balls, Suttles said. The first phase of the top kill effort used less than 15,000 barrels of drilling mud to try to fill the well, Suttles said. The company had 50,000 barrels available for use and has made sure there are additional supplies on hand for when pumping resumes, he said. ‘Arm Wrestle’ The top kill process uses drilling fluid to “arm wrestle” the gusher of oil and natural gas back into the well, said Robert Dudley , managing director for the London-based company. The procedure will serve as a temporary block on the damaged well until another well can be drilled and used to permanently plug it with cement. BP rose 28.8 pence, or 5.9 percent, to 520.8 pence yesterday in London trading. Based on the midpoint of the best estimates released by the Flow Rate Technical Group, the well may have leaked about 527,000 barrels from the day the rig sank, April 22, through May 26, more than double the size of the Exxon Valdez spill in Alaska. The amount of oil being spilled will help determine BP’s liability for the leak. Live Video Feed A live video feed provided by BP showed brown fluid flowing from the site. The feed alone cannot indicate the success of the effort to block the well, Suttles said. Ultimately, the effort will be considered successful when mud has fully blocked oil from leaking and the well has been capped with concrete. The well began leaking after an April 20 explosion and fire on the Deepwater Horizon drilling rig, which resulted in the deaths of 11 workers. BP leased the rig from Geneva-based Transocean Ltd. , the largest deep-water driller. Transocean rose as much as 9.1 percent yesterday. The shares gained $1.13, or 1.9 percent, to $59.71 at 4:01 p.m. in New York Stock Exchange composite trading. Halliburton Co., which provided services on the rig, rose $1.11, or 4.3 percent, to $26.99. Cameron International Corp., which provided equipment for the rig, rose $2, or 5.5 percent, to $38.08. Anadarko Petroleum Corp., which owns a 25 percent stake in the well, rose $2.23, or 4.2 percent, to $55.57. Congress Hearings An underwater oil plume from the spill may have spread 22 miles northeast toward Mobile, Alabama, researchers from the University of South Florida found in a preliminary report. Tests conducted aboard the school’s Weatherbird II vessel showed the highest concentrations of “dissolved hydrocarbons” were 400 meters (1,312 feet) underwater. Congress has scheduled at least 20 hearings on the Deepwater Horizon and offshore drilling since the rig exploded, and the Minerals Management Service and Coast Guard held another day of hearings in Louisiana on the reasons for the accident yesterday. President Barack Obama yesterday extended by six months a moratorium on new deep-water drilling permits that began after oil started to spill from BP’s well. The president also canceled a proposal to drill for oil off the coast of Virginia and planned drilling by Royal Dutch Shell Plc of exploratory wells in the Arctic off Alaska. The head of the Minerals Management Service, the federal agency that oversees offshore drilling, resigned yesterday, according to Interior Secretary Ken Salazar . Cost to BP The spill has so far cost BP a total of $850 million, or about $23 million a day, Suttles said yesterday. Average daily profit last year was $45 million a day, according to data compiled by Bloomberg . The accident “threatens to be the worst oil spill disaster in history,” BP investor Southeastern Pennsylvania Transportation Authority claimed in a Delaware Chancery Court lawsuit filed against BP directors on May 21 in Wilmington. Directors violated their duties to the company, causing “enormous economic harm for failure to act in the interests of BP and its shareholders” and exposing the company to liabilities in the billions of dollars, Septa lawyers contend. The lawsuit lists potential damage claims of about $2.5 billion to the Gulf fishing industry; $3 billion to tourism; $700 million in remediation efforts so far; $6 million a day in continuing costs and “incalculable damages to BP’s reputation.” To contact the reporter on this story: Jim Polson in New York at jpolson@bloomberg.net
Original post:
BP Resumes `Top Kill’ Work to Stop Gulf Oil Spill Bigger Than Exxon Valdez
