BP fights to limit the slick – and the damage to its reputation
BP is struggling almost as hard to limit the damage to its reputation over the Gulf of Mexico oil spill as it is to bring the leaking well itself under control – which may take three months, it became clear yesterday.
Although BP did not own or operate the Deepwater Horizon exploration rig which exploded and sank, leading to the spill, the company had leased the rig and owned the licence to drill in the seabed. That means that under US law it has to take full responsibility for the clean-up operation.
This may end up costing the firm as much as $500m (£327m) if the leaking well, which is pouring oil into the sea at a rate of 5,000 barrels a day, cannot be capped and can only be stopped by the drilling of a relief well, which is likely to take two to three months. The present clean-up operation, involving more than 70 vessels, is costing the firm $6m a day, and the relief well may be a $150m operation.
Yet the enormous costs are far from the only problem for the British company. In the US the incident is being seen as "BP's oil drilling disaster" even though the operation which led to the blowout was run by the Swiss-based oil drilling company Transocean, which owned and operated the Deepwater Horizon rig; only six of the 126 people on board at the time of the accident were BP employees.
BP's reputation in the US was already fragile after an accident at its Texas City refinery in 2005, which killed 15 workers and injured more than 170 others. The company's safety practices were ferociously criticised in an official inquiry.
BP is now likely to feel the full force of public anger if, as seems likely, a large area of the Gulf coast is devastated by the oil which began coming ashore yesterday. Some reports are already suggesting that if the leak continues for another three months, it will be the biggest oil spill in history.
Although the company has mobilised a substantial clean-up operation alongside its efforts to halt the leak, some environmentalists in the US have accused it of not responding quickly enough. After the rig exploded on 20 April and subsequently sank, it took the company four days to realise that the well itself was leaking.
"There's a feeling that BP didn't take the clean-up seriously at first or understand the concern," said Cynthia Sartou, chief executive of the Gulf Restoration Network, a leading environmental pressure group.
Ms Sartou is not interested in who might have caused the accident. "I think BP is 100 per cent responsible," she said. "It's no use trying to shift the blame to Transocean. They had control over the equipment used by Transocean. It was BP's well, and they are responsible under the law, and morally it's their duty to do all they can to gather up the oil, protect the shoreline and stop the well from leaking, and also to pay for the environmental and economic damage."
Given the scale of the looming pollution disaster, which is likely to devastate coastal wildlife and the fishing industry, BP is also likely to be the focus of anger from environmentalists who have been concerned for years that a major accident would happen in the waters of the Gulf.
"BP and the rest of the oil industry have been making representations to the American public for the 15 years I've been working in this area, saying there's no problem, don't you worry your little heads about any oil or gas drillings, we're really good at this and we can do it without causing a disaster," Ms Sartou said.
"People are facing ruin. We have fishermen who may go out of business, with the whole fishing season shut down, charter boat captains who make their living taking people out, who are not going to be able to do that, people who come here to birdwatch who won't be able to. The federal government has spent millions of dollars on the wildlife refuges along the coast."
She added: We've had long conversations about the expansion of oil exploration into other parts of the Gulf and been told our concerns are trivial, they have fail-safe mechanisms, they use the best technology, nothing like this could ever happen – that's why I'm so angry and cynical. I've been told I'm crazy for 15 years."
A BP spokesman denied that the company had been negligent, saying: "We have taken [our responsibilities] very seriously from the beginning, and immediately we knew about the accident we began an oil spill response programme."
Timeline: How the leak developed
Tuesday 20 April
First reports of an explosion on the Deepwater Horizon oil rig. Eleven of the 126 crew members are reported missing. Initially, officials say environmental damage will be minimal.
Saturday 24 April
After a second explosion sinks the rig, the US Coast Guard discovers two leaks in a drilling pipe 5,000 feet beneath the sea, pictured above. They are estimated to be releasing 1,000 barrels a day. By the end of the weekend the slick is expected to cover an area of 600 square miles.
Wednesday 28 April
With the oil slick coming within 20 miles of the Mississippi, the US Coast Guard begins a controlled burn of the leaking oil and steps up containment efforts. Meanwhile, an awards lunch recognising BP for its "exemplary safety and environmental management" is called off.
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