Storm halts BP oil spill efforts
Relief well operations stopped and vessels called to shore as tropical storm approaches.
BP capped the leaking well last week, choking off the flow of oil for the first time since an April 20 explosion killed 11 workers and sent crude gushing into the Gulf.
Delaying the efforts
Officials have said an evacuation could delay operations to provide a permanent solution to the situation.
“While these actions might delay the effort to kill the well for several days, the safety of the individuals at the well site is our highest concern,” retired Coast Guard Admiral Thad Allen said.
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“If we have to evacuate the scene we’re probably looking at a very limited window – probably 48 hours.”
The blown-out well will remain capped during the temporary halt to operations, but there are fears that the delay could risk further seepage into the water.
“It is a concern. The cap is only a temporary measure. The fact they have had to draw back to the coast is quite a worry,” Doug Youngson, an oil analyst at brokerage Arbuthnot, said.
“The pressure is building up. There is a risk it blows off,” he said.
Workers had been close to launching a “static kill” operation to pump heavy drilling mud and possibly cement into the well before their work was halted by the weather.
Al Jazeera’s Tom Ackerman, reporting from Biloxi in Mississippi, said that the booms protecting the shoreline of areas of the southern US coast were also being brought in because of the weather.
“There are miles and miles of absorbent booms, which when the storm starts can cause a lot of damage particularly to the marshlands, so those were recalled,” he said.
“They are also piling sand bags on the east side of the Mississippi river, and the government has called an emergency. It is not a hurricane level preparation but they say better be safe than be sorry later.”
Financial impact
As news of the halt to operations was announced, BP’s shares traded down 0.5 per cent and the price of crude surged.
“If Bonnie continues to strengthen, continuing worries about a potential disruption of oil operations in the Gulf of Mexico are likely to move crude oil prices higher to test the 80-dollar area,” Myrto Sokou, an analyst at Sucden Financial, said.
Analysts at Barclays bank said BP could on Tuesday report a loss for the second quarter of $13 billion as it makes provisions of up to $25 billion for the cost of the oil spill – far outweighing an expected 77 per cent jump in underlying profits.
The company’s stock is off about 40 per cent from levels before the accident, despite a rally over the past month sparked by hopes of asset or stake sales and an end to the spill.
At one stage $100 billion had been wiped off market capitalisation.
“The fall in value has been overdone,” Aruna Karunathilake, the manger of Fidelity’s UK Aggressive fund, said.
BP’s response to the largest offshore oil spill in US history was marked by a series of public relations gaffes by management and calls have grown for Tony Hayward, the chief executive, to step down.