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BP tussles with latest bid to contain oil spill

A glob of oil thought to be from the massive oil spill in the Gulf of Mexico sits on a reed on a beach in Southwest Pass, Louisiana May 15, 2010.



By Steve Gorman and Patricia Zengerle
Sat May 15, 5:48 pm ET

GALLIANO, La./WASHINGTON (Reuters) – BP Plc struggled on Saturday to get its latest effort to contain the massive Gulf of Mexico oil spill to work as the Obama administration demanded that the British energy giant clarify its intentions on paying for damage caused by the accident.

The accident at the offshore oil rig is threatening an ecological and economic calamity along the U.S. Gulf Coast.

As BP pushed forward with its tricky undersea effort to redirect the flow of oil after another setback, two members of President Barack Obama's Cabinet demanded that BP Chief Executive Tony Hayward explain in detail the company's commitment to pay for damage caused by the enormous spill.

"The public has a right to a clear understanding of BP's commitment to redress all of the damage that has occurred or that will occur in the future as a result of the oil spill," Interior Secretary Ken Salazar and Homeland Security Secretary Janet Napolitano said in a letter to Hayward.

"Therefore, in the event that our understanding is inaccurate, we request immediate public clarification of BP's true intentions," they added.

With crude oil gushing unabated into the sea from its blown-out offshore well a mile deep on the floor of the Gulf, BP sought to guide undersea robots to insert a small tube into a 21-inch (53-cm) pipe, known as a riser, to funnel the oil to a ship at the surface.

BP's initial attempt to insert the tube into the riser ran into trouble when the metal frame that supports the siphon shifted, BP Chief Operating Officer Doug Suttles told reporters in Robert, Louisiana on Saturday.

Suttles said BP hopes to get the siphoning tube inserted late on Saturday night and operational overnight.

"We did have to pull it back to surface (Friday) to make some adjustments so that we could connect it properly to the pipework," Suttles said. "We expect to begin operation of that equipment overnight tonight."

The company's previous attempt to contain the oil using a giant containment dome failed last week.

The spill began after an April 20 explosion on the Deepwater Horizon rig, which killed 11 workers. It threatens to eclipse the 1989 Exxon Valdez spill off Alaska as the worst U.S. ecological disaster ever.

Fisheries and tourism, two of the Gulf Coast's economic mainstays, along with birds, sea turtles and other wildlife, are threatened by the spreading slick.

DOWNPLAYING THE DISASTER?

In an interview published in a British newspaper on Friday, Hayward appeared to play down the disaster.

"The Gulf of Mexico is a very big ocean. The amount of volume of oil and dispersant that we are putting into it is tiny in relation to the total volume of water," Hayward was quoted as saying in Britain's Guardian newspaper.

Hayward also acknowledged his job was on the line and that he would be judged by the company's response to the disaster. BP's shares have tumbled and wiped out $30 billion of market value since the disaster began last month.

Questions have been raised about current U.S. law that limits to $75 million energy companies' liability for lost business and local tax revenues from oil spills.

Writing to Hayward, Salazar and Napolitano cited statements by BP executives that the company was taking responsibility for the spill and would cover spill-related costs.

"Based on these statements, we understand that BP will not in any way seek to rely on the potential $75 million statutory cap to refuse to provide compensation to any individuals or others harmed by the oil spill, even if more than $75 million is required to provide full compensation to all claimants," Salazar and Napolitano wrote.

Earlier, BP spokesman Mark Proegler said oil washed up in Mississippi for the first time in the state on Saturday, when tar balls were discovered at Long Beach. Oil has now contaminated several beaches in three states after it was also located at sites in Louisiana and Alabama.

Officials said that so far the spill has had minimal impact on the shoreline and wildlife but a massive operation is underway to protect areas seen as vulnerable along the coast.

CHEMICAL DISPERSANTS

Seeking to curb the volume of oil reaching the surface, the U.S. Coast Guard and Environmental Protection Agency have authorized more undersea use of chemical dispersants at the source of the leak. Dispersants are designed to break the oil into small droplets more likely to sink to the sea floor.

Suttles, speaking to reporters after flying over the scene of the spill, said the use of the chemical dispersants appears to be working. "The oil in the immediate vicinity of the well and the ships and rigs working in the area is diminished from previous observations," Suttles said.

Some environmental groups and the Gulf's shrimping industry have raised concerns about the effect of the chemicals, saying the oil might not sink all the way, but become suspended in the water column and ingested by fish and other wildlife.

Cleanup crews continue attacking the oil slick using surface dispersants, skimming and controlled burns.

Inland, BP contractors assisted by flotillas of hired shrimp boats continued to string containment booms around sensitive coastal areas. National Guard teams with bulldozers and helicopters pressed on to plug gaps in booms protecting Louisiana's storm-battered shoreline to prevent oil from reaching the fragile marshlands behind them.

The vast but dwindling marshes are the nurseries for shrimp, oysters, crabs and fish that make Louisiana the leading producer of commercial seafood in the continental United States and a top destination for recreational anglers.

Obama on Friday gave a tongue-lashing to all the companies involved in the spill -- BP, Halliburton and Transocean Ltd -- and said he would not rest until the leak was stopped at its source.

Estimates of the rate of escaping oil range widely from the official BP figure of 5,000 barrels per day (210,000 gallons/795,000 liters), adopted by the government, to 100,000 barrels (4.2 million gallons/15.9 million liters) per day.



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Really good to see large scale oil development at it best..... kinda makes you feel warm and fuzzy all over.... and to think we are paying 3 dollars plus... and there are millions of gallons being returned to the environment by BP albeit in the wrong evolutionary period and in an incorrect form.. it would appear...

But, hey.... they have all those really smart folks with all kinds of education, money and equipment... they can do anything... just ask them...

And isn't this really going to give the lawyers a field day... a case with no jurisdiction per se ....

A new era of LAW... just what we need about now... more law to help us get along with our daily lives .... this should be really fun....

I know this point isn't popular with many but I just keep thinking if we had spent all the money from the Iraq war on increased funding for research on non ICE technology as well as building more solar/wind farms where we might be today...