Tuesday, August 03, 2010

Day 106 BP Oil Spill: "Kill" Delayed; New Leak Estimates

Aug 3: The expected "static kill" operation was delayed due to a small leak in the top cap. BP issued a brief announcement indicating that "during final preparations to commence with the injectivity test, a small hydraulic leak was discovered in the capping stack hydraulic control system." The injectivity test , scheduled to take place Monday (August 2) was rescheduled until the leak is repaired. BP said, "It is anticipated that the injectivity test and possibly the static kill will take place Tuesday (August 3).
    Also, on August 2, based on new pressure readings, data, and analysis, the U.S. scientific teams charged by National Incident Commander Thad Allen with determining the flow of oil from BP's leaking well have refined their estimates of the oil flow prior to the well being capped on July 15. The new estimates, which draw heavily on recent oil reservoir modeling and on pressure readings of a closed system, are the most accurate to date and have an uncertainty of plus or minus approximately 10 percent. The scientific teams estimate that 53,000 barrels of oil per day were leaking from BP's well immediately preceding its closure via the capping stack.
    According to a release, recent measurements and modeling also show that, as a result of depletion of the hydrocarbon reservoir, the daily flow rate decreased over the 87 days prior to the well's closure. Based on these measurements and modeling, the scientific teams estimate that, at the beginning of the spill, 62,000 barrels of oil per day were leaking from the well. As previously reported by WIMS, initial estimates from BP and the Federal government were 1,000 barrels/day, and then 5,000 barrels/day.
    Overall, the scientific teams estimate that approximately 4.9 million barrels of oil have been released from the well. Not all of this oil and gas flowed into the ocean; containment activities conducted by BP under U.S. direction captured approximately 800,000 barrels of oil prior to the capping of the well.
    The new estimates reflect the collaborative work and discussions of the National Incident Command's Flow Rate Technical Group (FRTG), led by United States Geological Survey (USGS) Director Marcia McNutt, and a team of Department of Energy (DOE) scientists and engineers, led by Energy Secretary Steven Chu. At meetings on July 30 and July 31, the group of Federal and independent scientists and engineers discussed new analyses and data points to provide the updated range, relying heavily on newly available pressure readings from the new containment cap. An estimation of how much the flow rate has decreased over time was enabled by observing the pressure at shut in and by initial pressure estimates for the well when it was first drilled.
    The release indicates that the improved flow rate estimate brings together the work of several scientific teams and is based on a combination of analyses of high resolution videos taken by ROVs, measurements and modeling of reservoir and well properties, acoustic technologies, and measurements of oil collected by the oil production ship together with pressure measurements inside the containment cap. The installation of a new containment cap and the subsequent well integrity testing procedure provided the opportunity to calculate the flow by measuring the pressure at the top of the well as the choke and kill valves were manipulated after the main containment valve was closed to trap hydrocarbons.
    Representative Ed Markey (D-MA), Chairman of the House Energy and Environment Subcommittee of the Energy & Commerce Committee, issued a release reminding that BP officials stated that a maximum estimated flow would be 60,000 barrels a day, with a mid-range estimate of 40,000 barrels a day at a May 4, briefing to Members of Congress on the spill. He said, "Today we learned that BP's initial worst case scenario has been the reality since day one of this disaster. Had BP owned up to the size and magnitude of this oil spill from the very beginning, the government and families in the Gulf would have been better prepared to respond to this tragedy."
    Markey also indicated, "It took over 100 days and the pressure of flow rate calculations by independent scientists using high-definition undersea video to tell the world what BP most likely suspected from the start." He said additionally, last week he released documents indicating that BP assumed a flow rate of 53,000 barrels per day as early as July 6 when calculating how much dispersant to apply. Markey also reminded that the flow rate of the well will have substantial financial implications for the company. Under current law, BP would have to pay a fine of at least $1,100 and up to $4,300 per barrel of oil spilled, with the higher figure in the case of gross negligence being found against the company. Assuming 4 million barrels released and not recovered that could be a range of $4.4 to $17.2 billion.
    On August 3, BP announced that it has instituted a series of actions to expedite claim payments to businesses impacted by the oil spill in the Gulf of Mexico, including establishing an Immediate Action Claims Team. Darryl Willis, of the BP Claims Team said, "While we have paid thousands of business claims over the past 13 weeks, we recognize the frustration of small business owners who still have claims pending as we transition from the BP claims process to the Gulf Coast Claims Facility. We heard from many businesspeople who are suffering, so we acted. These changes are designed to cut through paperwork and expedite payments."
    About 2,600 business claims were processed over the past three days, using new guidelines developed to specifically address challenges faced by businesses. As a result, business claims totaling $9 million were approved Saturday, Sunday and Monday. The payments will be mailed to businesses this week. BP said the new procedures include paying claims from tourist businesses not directly linked to the natural resource but located in close proximity to the affected tourist resource, such as an oiled beach; simplifying documentation requirements; easing requirements for start-up businesses to prove a loss; and increasing the delegation of authority for adjusters.
    Access a release from BP on the delay (click here). Access a release on the new leak estimates (click here). Access a release from Rep. Markey (click here). Access a release on new payment procedures (click here). Access more information on BP activities from the BP response website (click here). Access the Restore the Gulf website for more information (click here). Access the Unified Command website which contains additional information (click here).