Tilted Forum Project Discussion Community - View Single Post - Louisiana Oil Rig Fire / Gulf of Mexico Oil Spill

roachboy · 07-08-2010, 06:58 AM

so first there's this new factoid:

Quote:

BP Sets New Spill Target
Aims to Cap Well by July 27 Earnings; Backup Plans as Obama, Cameron Meet

By MONICA LANGLEY

BP PLC is pushing to fix its runaway Gulf oil well by July 27, possibly weeks before the deadline the company is discussing publicly, in a bid to show investors it has capped its ballooning financial liabilities, according to company officials.

At the same time, BP is readying a series of backup plans in case its current operations go awry. These include connecting the rogue well to existing pipelines in two nearby underwater gas and oil fields, according to company and administration officials.

Much of the additional planning has been pushed by the U.S. government, which has urged BP to develop what one official called the "backup to the backup plan." Both BP and the federal government are concentrating on their next steps, particularly because of uncertainty caused by the imminent hurricane season and the protracted political and financial damage caused by the endless spill.

Both BP and the Coast Guard continue to state publicly they're aiming to have a fix in place in early to mid-August. BP has discussed its backup plans only with administration officials, who in turn have briefed President Barack Obama.

The July 27 target date is the day the company is expected to report second-quarter earnings and will speak to investors. BP also wants to show progress by July 20, the day U.K. Prime Minister David Cameron is scheduled to visit the White House.

"In a perfect world with no interruptions, it's possible to be ready to stop the well between July 20 and July 27," said the head of BP's Gulf Coast restoration unit, managing director Bob Dudley, in an interview. He added that this "perfect case" is threatened by the hurricane season and is "unlikely."

On Wednesday, on a visit to the Discoverer Enterprise, the ship that's collecting oil from the well, Mr. Dudley got word of a nine-day period of clear weather starting Friday, a period that could prove critical to the effort.

BP is drilling two relief wells through which it will pump material designed to seal the leaking well. One is now 12 feet horizontally and 300 feet vertically from the target spot.

Billy Brown, president of Blackhawk Specialty Tools, a BP contractor helping with the relief-well process, said Wednesday the effort is progressing ahead of schedule.

Mindful of prior snafus, BP has quietly crafted backup plans. The first would force spewing oil to a depleted gas field on the ocean floor two miles away. The second would move the oil to an existing underwater oil field nine miles away. Both require laying flow lines, either flexible or hard steel piping, to connect the leaking well to existing wellheads on these older sites.
Finding Relief

Shortly after the Deepwater Horizon accident, BP began drilling relief wells in hopes of stopping the flow of oil. Click to enlarge graphic and see how the process works.

The engineers described their plans at a seven-hour meeting last week featuring BP engineers and Energy Secretary Steve Chu, held at BP's Houston crisis center. Mr. Chu said he told them: "Force yourself to think each one will fail." In an interview, he added: "We're in new territory full of perils, and nothing is a slam dunk."

BP's Mr. Dudley reviewed Wednesday the company's engineering work with retired Coast Guard Admiral Thad Allen, who heads the Obama administration's effort.

Flying by helicopter to the ship collecting oil, the two men discussed the backup options. All around the ship, 43 miles offshore, the ocean was tinged orange.

The stakes are huge for BP, which has lost nearly half of its market capitalization since the explosion aboard the Deepwater Horizon rig April 20.

The company's board is setting up a "Gulf of Mexico" committee for a few directors to delve deeply into the disaster's safety and financial implications.

When they announce earnings July 27, BP officials hope to provide investors with more information on the estimated liabilities from the Gulf spill.

One official said the company wants to be able to describe the oil spill as finite, not infinite, a moment that would allow it to start calculating the total potential liabilities under U.S. law.

To prepare Prime Minister Cameron to speak with Mr. Obama about one of the U.K.'s largest companies, British Ambassador to the U.S. Nigel Sheinwald last Friday attended BP briefings in Houston and New Orleans and then toured the damaged Florida coast. He also met Coast Guard officials.

Support ships are seen near the Discoverer Enterprise drilling rig, right, as they continue the effort to recover oil from the Deepwater Horizon spill site on July 3, 2010 in the Gulf of Mexico off the coast of Louisiana.

At Wednesday's trip to the spill site, Mr. Dudley and Adm. Allen evaluated a prospect for controlling the spill—a newly designed cap to replace the leaky one currently directing oil to ships on the surface.

The risk: removing the old cap could exacerbate the spill in the short run.

At the administration's prodding, BP created a new device called an "autonomous subsea dispersant system." Environmental Protection Agency head Lisa Jackson told BP to create such a capability to monitor and measure chemicals used underwater to break up the oil. The large volume of dispersants used has concerned scientists and some government officials.

In recent days, the company has installed new battery-powered equipment on the ocean floor that will inject dispersant into the flowing well. Typically, the dispersants are controlled by ships on the surface, but they may have to move if storms hit.

Separately, the BP-dominated consortium that operates the Trans-Alaska Pipeline, Alyeska Pipeline Service Co, said Chief Executive Kevin Hostler will retire in September.

Mr. Hostler, a former senior BP executive, had faced accusations from U.S. lawmakers that efforts to cut costs put the integrity of the pipeline at risk.

A spokesperson for Alyeska couldn't be reached for comment.
—Angel Gonzalez and Guy Chazan contributed to this article.

BP Sets New Spill Target - WSJ.com

which is i suppose a good bit of infotainment to have, the new bp projections concerning what might be the case with the relief well/kill if you put aside reality and all it's nasty changy-ness....

but then in this morning's ny times, lead story front page:

Quote:

Owner of Exploded Rig Is Known for Testing Rules
By BARRY MEIER

Transocean is the world’s largest offshore drilling company, but until its Deepwater Horizon rig exploded in the Gulf of Mexico in April, few Americans outside the energy business had heard of it. It is well known, however, in a number of other countries — for testing local laws and regulations.

Human rights advocates have called for an investigation into Transocean’s recent dealings in Myanmar. They cite its involvement in a drilling project that apparently included a company that is suspected of having ties to two men accused of laundering money for Myanmar’s repressive government, which is under United States trade sanctions.

Transocean has disclosed in Securities and Exchange Commission filings that its drilling equipment was shipped by a forwarder through Iran and that until last year it held a stake in a company that did business in Syria. The State Department says Syria and Iran sponsor terrorism.

In Norway, Transocean is the subject of a criminal investigation into possible tax fraud. The company has said in S.E.C. filings that Norwegian officials could assess it about $840 million in taxes and penalties. The filings also said that a final ruling against Transocean could have a “material impact” on the company, which has suffered a drop in its stock price of more than 40 percent since the Gulf of Mexico incident.

And in the United States, a federal bankruptcy judge recently found that one of Transocean’s merger partners had repeatedly abused the legal system to try to avoid potential liability in a pollution case in Louisiana. Transocean is also the target of tax inquiries in the United States and Brazil.

Transocean declined though an outside spokesman to make company officials available for comment. The company said in a statement that it had always acted appropriately and believed that it would prevail in any investigations.

It is not unusual for large multinational companies like Transocean to find themselves in legal or tax controversies around the world and Transocean has noted the issues that face it in public filings. The company’s most significant safety problem overseas involved a 2007 episode in which eight people died off the coast of Scotland when a support vessel capsized while towing a huge chain used to position a Transocean rig. A Norwegian board of inquiry found that missteps by several parties, including Transocean and the support vessel’s owner, had contributed to the incident.

But the company’s practices in the United States and abroad have come under new scrutiny since the oil spill in the gulf. Last week, the chairman of the Senate Finance Committee, Max Baucus, Democrat of Montana, said that the panel would investigate whether Transocean had used its corporate base in Switzerland to exploit United States tax laws.

In its dealings with lawmakers, Transocean has stood its ground. Last month, in response to a demand that Transocean delay a planned distribution to shareholders of $1 billion in dividends, the company declared that paying the dividend “in no way affects Transocean’s ability to meet it legal obligations.”

Transocean has largely blamed BP, the well’s operator, for the spill, describing it as a company that took shortcuts on safety. Transocean has had a long relationship with BP, and for the last two years, BP has been Transocean’s largest single customer, accounting for 12 percent of its $11.5 billion in operating revenue in 2009, public filings show.

Industry analysts said that strong ties between the companies reflected the fact that both had staked their financial futures on pushing oil exploration as far off shore as possible. Transocean, which drills in some 30 countries and employs more than 18,000 people, owns nearly half of the 50 or so deepwater platforms in the world.

“These people are capable and considered the gold standard of deepwater drilling,” said Peter Vig, managing director at RoundRock Capital Management, an energy hedge fund in Dallas.

Transocean’s evolution into the world’s biggest deep-sea driller follows a decade-long acquisition and merger spree.

It began in 1996 when a Texas-based company called Sonat OffshoreDrilling acquired Transocean ASA, then Norway’s largest offshore driller. Three years later, the company, now known as Transocean, shifted its headquarters for tax purposes to the Cayman Islands from Houston, though a vast majority of its executives still work in Houston. In subsequent years, it acquired or merged with other drillers including R&B Falcon, the drilling unit of Schlumberger and GlobalSantaFe. Then, in 2008, for tax purposes, it moved its headquarters again, this time to Switzerland from the Cayman Islands.

The tax investigation in Norway involves how Transocean represented the sale of 12 drilling rigs owned by its Norwegian subsidiary to another company unit, said a spokeswoman for an agency known as Okokrim, which investigates economic and environmental crimes.

The case “raises several important questions regarding the taxation of multinational corporations,” said the spokeswoman, Mie Skarpaas, who declined to discuss the investigation further.

A Norwegian newspaper, Dagens Naeringsliv, reported several years ago that a Transocean rig, while returning from a repair yard in Norway to a drilling site in the Norwegian sector of the North Sea, diverted for several hours into British waters. During that time, Transocean transferred ownership of the rig between subsidiaries and later argued that it did not have to pay Norwegian taxes because profits on the transaction had been earned outside the country. The company subsequently settled the case involving that rig.

In 2008, Norway’s highest court ruled that Okokrim and tax authorities could share documents and computer files seized during raids of Transocean and Ernst & Young which was the company’s tax adviser. That ruling also said that at least three people, including two Ernst & Young employees, were under investigation in connection with the episode.

In its statement, Transocean said that its “tax returns are materially correct as filed” and that it “will vigorously defend any claims to the contrary.” A spokesman for Ernst & Young, declined to comment.

In Myanmar, formerly Burma, a Transocean rig was under contract to a Chinese government-controlled oil company, Cnooc, as recently as this spring. Another apparent stakeholder in the drilling site, according to Cnooc, was a Singapore business. That business has been linked to two men identified by the United States Treasury Department in 2008 as major operatives and money launderers for the Myanmar government. At the time, American authorities described both men as longtime heroin traffickers.

Transocean said in a statement that its contract was with Cnooc and did not mention either man. Transocean also said it had not violated the trade sanctions against Myanmar. “No Transocean affiliate that is subject to the U.S. ban has ever done business in Myanmar,” the company said.

In the United States, the recent ruling by a federal bankruptcy court judge involved one of Transocean’s merger partners.

Judge Kevin Gross of the United States Bankruptcy Court for the District of Delaware found in May that the partner, GlobalSantaFe, had entered into a misleading bankruptcy scheme that included the use of shell companies to avoid potential liabilities in an oil pollution case. Judge Gross found the actions so egregious that he ordered GlobalSantaFe and related units to pay $2 million in sanctions to another company involved in the case.

In a statement, Transocean said the issues involving GlobalSantaFe had occurred before their 2007 merger.

Judge Gross did not mention Transocean by name. But in his ruling, he said that GlobalSantaFe and its units were still involved in a “gamesmanship with the judicial system” to thwart potential claims.

Asked about Judge Gross’s ruling, Transocean said, “We are confident we’ll prevail in the remaining legal issues that have yet to be decided.”

http://www.nytimes.com/2010/07/08/bu...ef=global-home

and maybe you wonder....hmm...what's this add up to?

o hey...lookit this:

Quote:

Hayward Sees Abu Dhabi Prince as BP Seeks Support
By Zainab Fattah and Henry Meyer - Jul 7, 2010

BP Plc Chief Executive Officer Tony Hayward said he had a “very good” meeting with Abu Dhabi’s crown prince as analysts said the oil producer may be looking for support from Middle East investors.

Hayward, who spoke to reporters as he left the United Arab Emirates after a 24-hour visit, could be seeking money from sovereign wealth funds after BP incurred billions of dollars in liabilities from the oil spill in the Gulf of Mexico, UBS AG said. The crown prince, Sheikh Mohammed bin Zayed Al Nahyan, is chairman of Mubadala Development Co., an investment arm of the Abu Dhabi Government.

“The option for chasing strategic investors in the Middle East is a sound one,” Saud Masud, the Dubai-based head of Middle East research at UBS AG, said in a Bloomberg Television interview yesterday. “They have significant capital; then they also invest for the long-term.”

Sovereign wealth funds may be interested in buying BP stock after its price dropped by about half since the start of the worst U.S. oil spill. Hayward last month pledged to set aside $20 billion to compensate the spill’s victims and finance the cleanup. To pay for it, the company halted dividend payments and planned to sell $10 billion in assets across the globe.

BP shares rose 16.55 pence, or 4.8 percent, to 362.05 pence in London, the highest close since June 11.

BP Plc would be willing to sell a 10 percent stake in the company to Abu Dhabi, the Wall Street Journal reported, citing an unidentified person with knowledge of the matter.

The Meeting with the crown prince was “very good,” said Hayward as he arrived to board a private jet preparing to depart from Abu Dhabi. “It was a great delight to meet with our long- term partners and friends.”

BP has said it is not looking to issue new equity.

‘Less Pressure’

The London-based oil giant would benefit from attracting new capital by easing the pressure for rapid sales, said Rachel Ziemba, a senior analyst who tracks sovereign wealth funds at Nouriel Roubini’s New-York based Roubini Global Economics.

“Raising capital gives more room for maneuver by putting less pressure for asset sales,” she said by phone from London. “Buyers may demand a discount.”

Qatar’s sovereign-wealth fund and Mubadala and the International Petroleum Investment Co. in Abu Dhabi are the most likely to be interested in acquiring a BP stake, Ziemba said.

Abu Dhabi’s sovereign funds hold a combined $500 billion, according to Roubini Global Economics.

‘Makes Sense’

Sovereign funds traditionally “have invested in the European and western markets in large cap names, and when you can pick up BP at 50 percent cheaper than its recent highs, then it makes a lot of sense for both parties,” Masud at UBS said.

Spokesmen for the Abu Dhabi Investment Authority and the International Petroleum Investment Co. declined to comment on whether Hayward was scheduled to meet officials there. A spokesman for the Qatar Investment Authority also declined to comment.

Hayward has been touring countries where BP has exploration and production operations. He was in Russia last week and in Azerbaijan yesterday before arriving in Abu Dhabi.

BP produces oil in the sheikhdom, where it is a partner with state-run Abu Dhabi National Oil Co., known as Adnoc, in a venture that dates back to the first oil concession granted in the 1930s in what is now the U.A.E.

A Saudi business team, including energy industry investors, is seeking to acquire between 10 percent and 15 percent of BP’s shares and will hold talks with the company, Al Eqtisadiah reported today, without saying where it got the information.

‘Good Buy’

BP is a “good buy” after the drop in the share price, Shokri Ghanem, Libya’s top oil official, said in a Bloomberg Television interview yesterday. He’s advising Libya’s sovereign wealth fund to take a stake in BP.

The Kuwait Investment Office is in talks with BP about increasing its holding in the company, the Guardian newspaper said on its website on July 4. Kuwait does not plan to increase its stake in BP Plc “for now,” the newspaper Al-Rai said today.

“They are knocking on doors to see who they can get on their side, and countries are looking to see what opportunities there may be,” said PFC Energy Dubai-based analyst Thaddeus Malesa. A quick deal was unlikely as potential buyers would carry out substantial due diligence, he said

Hayward Sees Abu Dhabi Prince as BP Seeks Support - Bloomberg

aside:
Sovereign wealth fund - Wikipedia, the free encyclopedia

a+b=bp is able to put the infotainment it wants in the outlets it wants when it wants.

proof:

http://www.nytimes.com/2010/07/08/bu...obal/08bp.html

QED.

hooray free american press.
well fucking done.

meanwhile, a quick assessment of the claims regarding the relief well:

The Oil Drum | BP's Deepwater Oil Spill - Hitting the Well Annulus - and Open Thread