BP Plans to Finish Sealing of Macondo Well Tomorrow
Admiral Thad Allen
Andrew Harrer/Bloomberg
BP has spent at least $8 billion to date on cleaning up the spill following the explosion onboard the Deepwater Horizon rig, which killed 11 workers, on April 20.
BP has spent at least $8 billion to date on cleaning up the spill following the explosion onboard the Deepwater Horizon rig, which killed 11 workers, on April 20. Photographer: Andrew Harrer/Bloomberg
BP Plc could bring the worst oil spill in U.S. history to an end this weekend after intercepting the ruptured Gulf of Mexico well.
Sensors and pressure tests indicated that a relief well came into contact with the blown-out well’s casing, National Incident Commander Admiral Thad Allen said late yesterday, citing findings by BP engineers and a team of government scientists. The plan is to cement the space between the pipe and the walls of the well known as the annulus, he said in a statement.
“We intend to proceed with preparation to cement the annulus and complete the bottom kill of the well,” Allen said in a statement.
The disaster wiped about $71 billion off London-based BP’s market value and cost Chief Executive Officer Tony Hayward his job. It led to calls by some U.S. lawmakers for BP to be barred from receiving drilling permits in the Gulf of Mexico.
BP has spent at least $8 billion to date on cleaning up the spill following the explosion onboard the Deepwater Horizon rig, which killed 11 workers, on April 20. The well gushed an estimated 4.9 million barrels of oil about 40 miles (64 kilometers) off the Louisiana coast. No crude or gas has leaked from the well since BP capped it on July 15.
BP’s effort to intercept the well took longer than initial expectations partly because of weather disruptions. On June 25, the company said it would take a few weeks for the relief drilling to reach the 17,909 foot (5,549 meters) level where it would enter the MC252 well.
Four Days
Allen said on Sept. 15 that BP may permanently plug the well in four days as the relief well made its final approach. The relief well will be used to inject mud and cement into any remaining gaps.
“Seems like they are continuing to make progress,” said Victor Shum, a senior principal at consultants Purvin & Gertz Inc. in Singapore. “The expectation is that the final steps will come in due course.”
BP last week published a 234-page report on the causes of the leak, where it said that both BP managers and other companies made mistakes that led to the explosion on the rig. The blame for many of the mistakes rests primarily with rig owner Transocean Ltd., Halliburton Co., which cemented the well, and Weatherford International Ltd., which provided valves for the well, according to the report.
BP said in July it would increase asset sales to raise as much as $30 billion over 18 months to help pay for cleanup costs and liabilities from the accident. In June, it agreed to create an independent $20 billion fund to help victims of the Gulf spill.
The company posted a record quarterly loss of $17.2 billion when it reported earnings on July 27 after booking a $32.2 billion pretax charge related to the spill. It delayed its third-quarter earnings report by a week to Nov. 2 because it needs extra time to account for the costs of the leak response.
Anadarko Petroleum Corp., a Texas-based oil company, has a 25 percent stake in the Macondo well. A unit of Mitsui Oil Exploration Co., which is 70 percent owned by Japan’s Mitsui & Co., holds a 10 percent interest.
To contact the reporter on this story: Christian Schmollinger in Singapore at christian.s@bloomberg.net
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