Let us drill – or we may not have cash to pay Gulf claims

BP appeals to Congress as it considers banning firm from exploring US waters

With the permanent sealing of its blown-out well in the Gulf of Mexico perhaps just days away, BP is warning that it may not have the money to pay the colossal clean-up bill if Congress passes a law that would stop it obtaining permits for offshore drilling in US waters.

The new confrontation emerged yesterday as BP announced that total costs arising from the explosion of the Deepwater Horizon rig on 20 April, in which 11 workers died in one the worst environmental disasters in US history, rose by a further $2bn last month to around $8bn.

The law in question was passed by the House of Representatives just before Congress's summer recess but is still awaiting approval in the Senate. It would bar any company from drilling on the US outer continental shelf if more than 10 people had been killed in accidents at facilities it operates – either onshore or offshore – or if it has been fined $10m or more in the past seven years for violating US anti-pollution laws.

BP is not specifically mentioned in the measure but it is the only company that would qualify for such a ban. The Bill's chief sponsor, the California Democrat George Miller, has made it clear that BP was the intended target.

For the company, such a ban would strike at its biggest source of revenue and profits. BP is the biggest single oil company operating in the Gulf, and the 400,000 barrels a day it produces there represent 11 per cent of its total global output, accounting for an estimated 25 per cent of annual profits that reached $14bn in 2009.

"If we are unable to keep those fields going, that is going to have a substantial impact on our cash flow, David Nagel, the executive vice-president of BP America, told The New York Times, "and that makes it harder to fund things, fund these programmes."

BP insists it is standing by its promised $20bn clean-up fund, which would also pay government fines and meet compensation claims for the spill that spewed 206 million gallons of crude for three months until it was provisionally plugged in mid-August. But Mr Nagel's words are a heavy hint that other projects, including a $500m research programme on the impact of the spill, could be endangered if the Miller Bill became law.

Meanwhile, plans proceed for a final sealing of the rogue well. This week, engineers removed its temporary cap as a prelude to raising the massive blowout preventer whose failure caused the disaster. The preventer is now a crucial piece of evidence in the investigation of the calamity.

It will be replaced by a new one to deal with pressure that may be caused when a relief well BP has been drilling finally intersects its blown-out Macondo well. This will allow engineers to permanently seal the broken well from the bottom with mud and cement. The operation is expected some time next week after the Labor Day public holiday.

In another piece of good news, it seems clear that a second explosion on an oil platform in the Gulf on Thursday caused no long-term damage. Unlike the BP incident, the blast took place not on a rig but on a fixed platform, Vermillion 380, owned by the Mariner Energy group.

All 13 workers were rescued and there was no report of any spillage at the seabed. Moreover, the accident happened in waters only 300ft deep, compared with a sea depth of a mile in the case of BP's Macondo well, about 200 miles to the east.

The Coast Guard initially reported that an oil sheen a mile long and 100ft wide had begun to spread. Hours later, however, it said crews were unable to find any spill.

Arts and Entertainment
Gregg Wallace in Summer's Supermarket Secrets
tv All of this year's 15 contestants have now been named
Arts and Entertainment
Inside the gallery at Frederick Bremer School in Walthamstow
tvSimon Usborne goes behind-the-scenes to watch the latest series
Life and Style
A picture taken on January 12, 2011 shows sex shops at the Paris district of Pigalle.
newsThe industry's trade body issued the moratorium on Friday
News
Winchester College Football (universally known as Winkies) is designed to make athletic skill all but irrelevant
Life...arcane public school games explained
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebooksAn evocation of the conflict through the eyes of those who lived through it
Arts and Entertainment
Could we see Iain back in the Bake Off tent next week?
tv Contestant teased Newsnight viewers on potential reappearance
Life and Style
Silvia says of her famous creation: 'I never stopped wearing it. Because I like to wear things when they are off the radar'
fashionThe fashion house celebrated fifteen years of the punchy pouch with a weighty tome
News
i100(and it's got nothing to do with the Great British Bake Off)
News
Angelina Jolie with her father Jon Voight
peopleAsked whether he was upset not to be invited, he responded by saying he was busy with the Emmy Awards
News
Bill Kerr has died aged 92
peopleBill Kerr appeared in Hancock’s Half Hour and later worked alongside Spike Milligan and Peter Sellers
News
news It's not just the world that's a mess at the moment...
Sport
footballPremiership preview: All the talking points ahead of this weekend's matches
News
Keira Knightley poses topless for a special September The Photographer's issue of Interview Magazine, out now
people
Voices
The Ukip leader has consistently refused to be drawn on where he would mount an attempt to secure a parliamentary seat
voicesNigel Farage: Those who predicted we would lose momentum heading into the 2015 election are going to have to think again
Arts and Entertainment
Cara Delevingne made her acting debut in Anna Karenina in 2012
film Cara Delevingne 'in talks' to star in Zoolander sequel
News
i100
Sport
Mario Balotelli pictured in his Liverpool shirt for the first time
football
Life and Style
tech
Independent
Travel Shop
the manor
Up to 70% off luxury travel
on city breaks Find out more
santorini
Up to 70% off luxury travel
on chic beach resorts Find out more
sardina foodie
Up to 70% off luxury travel
on country retreats Find out more
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

C# Algo-Developer (BDD/TDD, ASP.NET, JavaScript, RX)

£45000 - £69999 per annum + Benefits + Bonus: Harrington Starr: C# Algo-Develo...

Senior Data Scientist (Data Mining, Apache Mahout, Python,R,AI)

£60000 - £70000 per annum + Benefits + Bonus: Harrington Starr: Senior Data Sc...

Data Scientist (SQL,Data mining, data modelling, PHD, AI)

£50000 - £80000 per annum + benefits+bonus+package: Harrington Starr: Data Sci...

Java Developer - 1 year contract

£350 - £400 Per Day: Clearwater People Solutions Ltd: Our client based in Cent...

Day In a Page

Ukraine crisis: The phoney war is over as Russian troops and armour pour across the border

The phoney war is over

Russian troops and armour pour into Ukraine
Potatoes could be off the menu as crop pests threaten UK

Potatoes could be off the menu as crop pests threaten UK

The world’s entire food system is under attack - and Britain is most at risk, according to a new study
Gangnam smile: why the Chinese are flocking to South Korea to buy a new face

Gangnam smile: why the Chinese are flocking to South Korea to buy a new face

Seoul's plastic surgery industry is booming thanks to the popularity of the K-Pop look
From Mozart to Orson Welles: Creative geniuses who peaked too soon

Creative geniuses who peaked too soon

After the death of Sandy Wilson, 90, who wrote his only hit musical in his twenties, John Walsh wonders what it's like to peak too soon and go on to live a life more ordinary
Caught in the crossfire of a cyber Cold War

Caught in the crossfire of a cyber Cold War

Fears are mounting that Vladimir Putin has instructed hackers to target banks like JP Morgan
Salomé's feminine wiles have inspired writers, painters and musicians for 2,000 years

Salomé: A head for seduction

Salomé's feminine wiles have inspired writers, painters and musicians for 2,000 years. Now audiences can meet the Biblical femme fatale in two new stage and screen projects
From Bram Stoker to Stanley Kubrick, the British Library's latest exhibition celebrates all things Gothic

British Library celebrates all things Gothic

Forthcoming exhibition Terror and Wonder: The Gothic Imagination will be the UK's largest ever celebration of Gothic literature
The Hard Rock Café's owners are embroiled in a bitter legal dispute - but is the restaurant chain worth fighting for?

Is the Hard Rock Café worth fighting for?

The restaurant chain's owners are currently embroiled in a bitter legal dispute
Caribbean cuisine is becoming increasingly popular in the UK ... and there's more to it than jerk chicken at carnival

In search of Caribbean soul food

Caribbean cuisine is becoming increasingly popular in the UK ... and there's more to it than jerk chicken at carnival
11 best face powders

11 best face powders

Sweep away shiny skin with our pick of the best pressed and loose powder bases
England vs Norway: Roy Hodgson's hands tied by exploding top flight

Roy Hodgson's hands tied by exploding top flight

Lack of Englishmen at leading Premier League clubs leaves manager hamstrung
Angel Di Maria and Cristiano Ronaldo: A tale of two Manchester United No 7s

Di Maria and Ronaldo: A tale of two Manchester United No 7s

They both inherited the iconic shirt at Old Trafford, but the £59.7m new boy is joining a club in a very different state
Israel-Gaza conflict: No victory for Israel despite weeks of death and devastation

Robert Fisk: No victory for Israel despite weeks of devastation

Palestinians have won: they are still in Gaza, and Hamas is still there
Mary Beard writes character reference for Twitter troll who called her a 'slut'

Unlikely friends: Mary Beard and the troll who called her a ‘filthy old slut’

The Cambridge University classicist even wrote the student a character reference
America’s new apartheid: Prosperous white districts are choosing to break away from black cities and go it alone

America’s new apartheid

Prosperous white districts are choosing to break away from black cities and go it alone