BP’s Bill for the World’s Largest Oil spill: $61.6 billion

On April 20, 2010, a well blowout a mile under the Deepwater Horizon exploration ship sent a surge of oil and gas up to the rig, setting it on fire and killing 11 crew members. The well leaked for 87 days, and 3.19 million barrels of crude oil poured into the Gulf of Mexico. BP just totaled up the amount of legal bills, damage settlements, restoration costs, and fines it has paid to hundreds of lawyers, 400 local governments, thousands of claimants and the federal government, and the tab comes to $61.6 billion.

More:

“BP’s big bill for the world’s largest oil spill reaches $61.6 billion,” Steven Mufson, Washington Post

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BP ‘Grossly Negligent’ in the Gulf Oil Spill

On Thursday September 4, 2014 U.S. District Court Judge Carl J. Barbier, Louisiana born and bred, found BP to be “grossly negligent” in the 2010 Deepwater Horizon oil spill, attributing 67% of the blame to the company, 30% to contractor Transocean, and 3% to submarine cement subcontractor Halliburton. BP may be liable for as much as $18 billion in fines under the Clean Water Act. BP had tried to claim its two partners in the drilling venture were equally responsible, so the ruling essentially doubles that. BP says it will appeal.

With this fine on top of other Deepwater fines, costs, and damage expenses, BP’s total bill for the disaster could reach $50 billion.

BP Oil Spill +2

While the media fleet sailed with the Titanic centennial story, this week marked the anniversary of another maritime disaster. The Deepwater oil spill happened two years ago, but you wouldn’t know it unless you live on the Gulf Coast. Most media coverage  boosted the recovery of tourism and the fishing industry. Only the editors of the Tampa Bay Times have a weather eye on the future:

“Two years later, spill’s dangers linger,” Tampa Bay Times editorial

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Oil Spill Commission Blames Everyone

The National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling released a sneak preview of its report Wednesday. Verdict: “systemic failure” by all parties involved, including government regulators. The Commission says this kind of thing could happen again.

Commission Establishes Oil Spill Blame

Contractor Halliburton knew the cement it used to seal the BP Deepwater oil rig was faulty but used it anyway, according to a report released by a federal commision. “Halliburton and BP both had results in March showing that a very similar foam slurry design to the one actually pumped at the Macondo well would be unstable, but neither acted upon that data,” according to investigators.

Thomas Roth, Halliburton’s vice-president of cementing, recently stated that his company’s tests showed the materials had “good stability,” a claim contradicted by BP officials.

Just who is to blame for the disaster?

BP Changes Caps

Update: The cap is ON.

BP is replacing the old cap on its gushing Gulf oil well. Removing the old cap has allowed crude oil to gush unrestrained into the Gulf of Mexico, some 60,000 barrels per day.

The new cap will have an improved, snug fit, and should capture more crude. It has been manufactured by Cameron, the company that also made the blowout prevention valves (BOPs) on the Deepwater Horizon.  The cause of the failure of the Deepwater’s BOPs has yet to be determined.

  

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Judge Sold Exxon Stock 5 Hours Before Lifting Drilling Ban

Federal Judge Martin Leach-Cross Feldman engaged in an oil spill cleanup of his own last week. Five hours before he rendered his decision blocking the six-month moratorium on deep-water Gulf oil drilling, Judge Feldman sold his personal holdings of Exxon Mobil stock. Exxon was not a party to the case under consideration but will directly benefit from the Judge’s action.

Judge Feldman may have lost a few dollars on the sale; he definitely lost much more in credibility. “The judicial canons require that judges be aware of their investments,” wrote Steven Mufson and Joe Stephens in the Washington Post:

“Judicial ethicists said that, had he been aware of his holdings, Feldman should have disclosed the ownership or recused himself at the case’s outset if he thought it posed a conflict or raised questions about his impartiality. The court docket indicates that Feldman signed several orders before the sale.

“‘I’ve never heard of a situation like this,’ said Jeffrey M. Shaman, a judicial ethics specialist and law professor at DePaul University.

“The judge may have thought the stock did not create a substantial conflict, legal analysts said, but the fact that he apparently felt compelled to sell the stock and disclose it could be seen as indicating otherwise.

Failure to Cap Well; Failure to Cap Liabilities

Transocean, the Swiss corporation that owned and operated the Deepwater Horizon drilling rig, tried to limit its Gulf oil spill liability to $27 million, citing a U.S. law from 1851. The Justice Department objected, and lawyers for families of Deepwater victims agree. The oil drilling company changed its position.

Transocean actually made money from the loss of the oil rig, which was insured for $270 million in excess of its actual value. The corporation will  also distribute $1 billion in dividends to its shareholders this year. Families of Transocean employees killed and injured in the Deepwater explosion still await compensation.

 

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BP’s Hair-Raising Story

Barbershops, beauty salons, and poodle groomers across the nation sent hair clippings to the Gulf Coast to help sop up the BP Deepwater oil spill. People collected tons of tresses. Now it won’t be used after all.

Tampa’s Karen McAllister asks the big question:

“BP isn’t using donated hair to clean up oil spill. What should we do with it?”

Frankly, we don’t want to know, but you can tell Karen here.

 

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BP Sips Away at Oil Spill

BP announced that it has inserted a tube into the seabed pipe that has been gushing crude oil into the Gulf of Mexico for nearly a month. The new tube is diverting 1,000 barrels of oil a day into a tanker, according to BP. The blowout is spilling  anywhere from 5.000 to 80,000 barrels into the Gulf each day, so this is colf comfort.

 UPDATE:

BP now says it is reclaiming 2000 barrels a day from the oil spill. What BP has not done: revise the estimated rate of oil spill volume upward, as other observers have.

New directions in BP engineering outlined by Carl Hiaasen (Miami Herald). 

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