The Gulf of Mexico oil spill is causing new headaches for BP and has prompted coastal communities and members of Congress to call for more oversight from the U.S. government.
Confirmation that an oil sheen reported last month is consistent with oil from BP’s blown-out Macondo well comes at a critical time, just as talks intensify about resolving penalties and fines from the disaster in April 2010.
Scientists have said that residual oil from the well and the wreckage of the Deepwater Horizon rig and equipment on the seafloor that was used to cap the well could be dredged up for months and years to come.
The Sept. 16 discovery of the sheen, which the U.S. Coast Guard confirmed late Wednesday correlated to oil from BP’s Macondo well, has renewed attention and concern.
“As bad as the spill was and as great as a catastrophe as the Deepwater Horizon explosion was, I don’t think we can underestimate anything,” Orange Beach, Ala., Mayor Tony Kennon said Thursday.
U.S. Rep. Edward Markey of Massachusetts, a top Democrat on the House Committee on Natural Resources, is calling for a full undersea survey of the Macondo site to be carried live on the Internet so independent scientists can see what is going on. A camera focused on the gushing well after the April 20, 2010 disaster, and when a massive cap halted the flow almost three months later.
“One can only hope that the nightmare well has not come back to haunt the people of the Gulf,” said Markey, a frequent oil industry critic.
Scientists say that the find is not surprising, even more than two years later, especially if the oil is coming from the equipment on the seafloor.
“It’s like after a ship sinks, it continues to leak long after it sinks,” said George Hirasaki, a Rice University engineering professor who was involved in oil containment efforts after a Shell platform in the shallow-water Bay Marchand field caught fire off Louisiana in the 1970s, killing four workers.
BP, meanwhile, has been in on-and-off talks over the last year with the Justice Department and others about resolving remaining claims and addressing civil and criminal fines and penalties.
BP could face up to $21 billion in fines related to Clean Water Act violations alone, but it has been seeking to reduce its exposure by settling for a smaller figure and getting cement contractor Halliburton and rig owner Transocean to contribute some of the money.
While talks continue between BP and the Justice Department, several people briefed on the situation say they don’t expect an announcement on a deal before the November election.
BP also likely would want to make another run at its partners to see if they are willing to share in paying for any settlement that is reached, and has not had such discussions with Transocean and Halliburton for months, according to two people familiar with the matter. They cannot be identified because of the sensitivity of the case.
Halliburton and Transocean have argued they are not liable for damage from the well, and a court ruling in February bolstered their position.
BP already has spent or committed tens of billions of dollars to clean up damage from the spill and compensate victims, and the total amount it pays could balloon when fines and penalties are factored in.
The company has reached a proposed class action settlement covering individuals and businesses claiming health and economic damages, but that deal doesn’t cover government fines and penalties.
The new oil sheen in the Gulf has given all the players something new to think about.
A statement from the Coast Guard on Wednesday night gave no indication of any active leak. It said the source of the sheen is uncertain but could be residual oil associated with debris left on the seafloor following the disaster.
BP said Thursday it believes the oil came from equipment associated with the blown-out well, and not the well itself. It said it has been working closely with the Coast Guard and other government officials to investigate the source of the oil. The company said flights over the area and vessel surveys suggest that the integrity of the cap on the Macondo well and the associated relief well are sound.
“The size of the sheen, its persistent point of origin and other factors indicate the most likely source is the bent riser pipe that once connected the rig to the well head, where a mix of oil, drilling mud and seawater were trapped after the top kill operation,” BP said.
The top kill, which involved pumping material into the gushing wellhead, was an early, unsuccessful attempt to stop the flow.
Matt Dundas of the environmental group Oceana said the news about the sheen is troubling.
“Here we are, two years and 5 million barrels of spilled oil later, and we’re still dealing with BP’s inability to keep oil out of the ocean,” he said.
Eleven rig workers were killed when the Deepwater Horizon rig exploded and, according to the government, more than 200 million gallons of oil was discharged from the well a mile beneath the surface of the Gulf.