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Energy chief: Cap didn't make spill worse

BP's moves to contain and capture more oil from a leaking undersea well in the Gulf of Mexico did not make the spill dramatically worse, U.S. Energy Secretary Steven Chu said Friday.
/ Source: news services

BP's moves to contain and capture more oil from a leaking undersea well in the Gulf of Mexico did not make the spill dramatically worse, U.S. Energy Secretary Steven Chu said Friday.

Chu, speaking to Reuters in an interview, also expressed optimism that sufficient safety measures could be made to eventually lift a U.S. moratorium on deepwater drilling.

Some scientists have raised concerns that BP exacerbated the spill last week when it cut the so-called riser pipe to the gushing well to install a huge containment cap.

The Obama administration initially said that cutting the riser could raise the oil spill flow rate by as much as 20 percent, but Chu said pressure measurements indicated the actual increase was much smaller than that.

"The estimates of 20 percent or more are incorrect," Chu said, adding the government was confident in its estimates of a 4 percent to 5 percent flow increase since the operation.

U.S. scientists said Thursday the blown-out well could have been spewing as much as 2 million gallons of crude a day before a cut-and-cap maneuver on June 3 started capturing some of the flow, meaning more than 100 million gallons may have leaked into the Gulf since the start of the disaster in April. That is more than nine times the size of the 1989 Exxon Valdez disaster, previously the worst oil spill in U.S. history.

Chu said his team was working with BP to get new pressure readings in the next several days, which would provide an accurate estimate of the oil escaping from the well after that date.

"We think we can give a good number, a number that we think should be more reliable than trying to estimate flows based on videos," Chu said.

President Barack Obama imposed a six-month moratorium on deepwater drilling because of the spill and said he would not feel comfortable lifting it without assurances that such an accident would never happen again.

"Of course there's a possibility of having that," Chu said when asked whether those safety assurances could be met.

"Certainly, one can do a lot of things to make it much safer. That much we know and those things will be done. And quite frankly, one can do a lot of these things by retrofitting existing equipment in an accelerated way, which will also be very good."

The moratorium has unsettled the oil industry and prominent lawmakers from Louisiana, including Gov. Bobby Jindal, who said on Friday that it represented too big a hit to the state's economy without widespread agreement it would improve safety.

Touring coastline protection measures in Buras, La., Jindal told reporters that the moratorium was prompting businesses in numerous sectors to scale back spending and workers' hours.

"The fact that the federal government can't do their jobs shouldn't cost thousands of Louisianians our jobs," Jindal said. Louisiana is one of the nation's main beneficiaries of offshore drilling, supplying and servicing much of the industry's activities in the Gulf.

Bigger numbers
Meanwhile, new estimates that the oil leak at the bottom of the sea may be twice as big as previously thought could have major repercussions for both the environment and BP's financial health, killing more marine life and dramatically increasing the amount the company must pay in fines and damages.

The larger estimates, while still preliminary and considered a worst-case scenario, could contribute to breathtaking liabilities against BP. Penalties can be levied against the company under a variety of environmental protection laws, including fines of up to $1,100 under the Clean Water Act for each barrel of oil spilled.

Based on the maximum amount of oil possibly spilled to date, that would translate to a potential civil fine for simple discharge alone of $2.8 billion. If BP were found to have committed gross negligence or willful misconduct, the civil fine could be up to $4,300 per barrel, or up to $11.1 billion.

"It's going to blow the record books up," said Eric Schaeffer, who led the Environmental Protection Agency's enforcement office from 1997 to 2002.

A larger spill also could lead to increased environmental hazards, with shrimp, crabs and fish such as marlin and swordfish especially hard hit.

"Certainly if there are greater volumes of oil than were originally estimated, that doesn't bode well," said Jim Franks, a fisheries biologist at the University of Southern Mississippi Gulf Coast Research Laboratory. "Do we expect twice the impact? I don't know how to judge that, but that much more oil could not be good at all for fish and wildlife resources. I would anticipate far-reaching impacts."

And there's more bad news. The oil gushing from the Gulf contains large amounts of natural gas. Samantha Joye, a professor of marine sciences at the University of Georgia, said that can contribute significantly to oxygen levels plummeting in the water as microbes eat the methane clouds.

In addition to the potential for billions in fines, BP is responsible for paying all cleanup costs and up to $75 million for economic damages. But it could face far heavier expenses if gross negligence is found or if it is determined that there was a violation of a federal safety, construction or operating regulation, Schaeffer said.

"You bet the trial lawyers are sharpening their swords around that language," he said.

And that's not including the tens of billions of dollars in shareholder wealth that has already evaporated with the plunge of BP's stock since the disaster.

To the defense
New York City Mayor Michael Bloomberg became a lonely defender of BP, declaring the world should not rush to point fingers at the British oil giant. The billionaire tycoon often sides with CEOs and businesses entangled in public relations disasters.

"The guy that runs BP didn't exactly go down there and blow up the well," Bloomberg said on his weekly radio show. "And what's more, if we want them to fix it and they're the only ones with the expertise, I think I might wait to assign blame."

That the BP oil spill may be twice as bad as earlier estimates was hard news to hear but no surprise to Christian Delos Reyes, a 39-year-old oyster dredger.

"Crabs start real small. You know they're all going to die. It'll kill all the oysters. In my opinion, I don't think it'll ever be all right," Reyes said. "I think it's destroyed."

Wanda Kirby, 65, owns the Sandpiper Shores Motel in Grand Isle, La., a couple of hundred feet from where a long strand of bright orange boom slices across the beach to block the oil.

"Whether it's five gallons or five million, I don't care. We don't really need to be wasting time measuring it," she said. "We just need to stop it."