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Firms fight over Gulf of Mexico oil spill blame

BP’s US boss, Lamar McKay, told the US Senate Energy and Natural Resources Committee the company “will not rest” until the gushing well “is under control”.


BLOG: Matthew Hall on the US oil spill

“Nothing is being spared” to mitigate the dire environmental and economic impact of the disaster, McKay said, amid calls from lawmakers and the White House to lift a cap on damages paid to devastated communities.

BP’s in-house investigation into the disaster, led by a 40-person team, “has not yet reached conclusions” about the blast that led to the sinking of the Deepwater Horizon offshore drilling platform, McKay said.

But the executive pointedly directed questions at the rig owner, saying Transocean Limited was responsible for a key piece of equipment that failed after the explosion, making it impossible to regain control of the well.

‘Fail-safe’ failure

“The systems are intended to fail-closed and be fail-safe; sadly and for reasons we do not yet understand, in this case, they were not. Transocean’s blowout preventer failed to operate,” he said.

Transocean chief Steven Newman, in his prepared remarks, said blaming the 450-ton blowout preventer “simply makes no sense” and stressed “all offshore oil and gas production projects begin and end with the Operator,” BP.

And Newman pointed the finger at Halliburton, saying the oil services company was responsible for the well’s cement casing, a temporary cement plug in the top of the well, and the cement’s integrity.

“The one thing we know with certainty,” he said, is that “there was a sudden, catastrophic failure of the cement, the casing, or both” the night of the blast, April 20.

“Therein lies the root cause of this occurrence; without a disastrous failure of one of those elements, the explosion could not have occurred,” Newman said.

Massive oil slick

But Halliburton’s chief health, safety, and environment officer, Tim Probert, said in his prepared testimony that his company had finished its cementing work 20 hours before the blast and according to industry practice.

And Probert said Halliburton had never set the final cement plug because, as Transocean was doing work on the well, “the catastrophic incident occurred”.

AFP obtained copies of all of the prepared testimony on the eve of the hearing, the first of several that angry politicians have vowed to hold into offshore oil drilling safety with the massive slick threatening the environment and coastal communities’ livelihoods.

While oil companies are responsible for footing the entire cleanup bill, lawmakers from coastal states have pushed for legislation that would lift the cap on their liability for economic damages from US$75 million to US$10 billion.

On Monday, the White House said President Barack Obama had directed staff to “send legislation to Congress to toughen and update the law surrounding caps on damages”.

Compensation claims

“As the President has made clear before, BP will be paying for all costs of stopping the spill and cleaning it up, and we will aggressively pursue full compensation for damages,” said spokesman Robert Gibbs.

McKay said BP had paid US$3.5 million thus far to claimants who have suffered a loss of income.

“BP will pay all necessary clean up costs and is committed to paying legitimate claims for other loss and damages caused by the spill,” he said.

BP said its disaster-related costs have reached US$350 million since the rig sank 80km off the Louisiana coast two days after an explosion on the platform killed 11 workers.

The undersea well has been spewing an estimated 210,000 gallons per day into the Gulf of Mexico since the rig sank April 22.

The Senate Environment and Public Works was also to hold a hearing on the disaster on Tuesday, and a House panel was to do so on Wednesday.

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