Will They or Won't They?

Jim Brown
 
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BP has entered a new phase in the oil spill saga. We have analysts claiming they have emails from BP workers saying the well could be plugged around the 12th to the 17th. A BP spokesman responded to other rumors saying it could be plugged on the 27th. BP still claims it will be mid August. What is the real story?

The BP spokesman, Bob Dudley, said the well was ahead of schedule and plugging it on the 27th might be possible in a perfect world but we don't live in a perfect world. Everything would have to go absolutely perfect with the drilling, the intercept, mud pumping and with the weather. The odds of that happening are nearly zero.

To add some mystery to the puzzle the Coast Guard ordered BP on Thursday to produce plans for swapping out the LMRP that is currently allowing 50% of the leaking oil to flow into the sea. BP responded that tropical storm Alex delayed their swap of the riser cap but it would be in place by July 7th or 8th. Here we are at 9:PM on the 8th and the old LMRP is still in place.

The new LMRP is supposedly a tighter fitting unit to allow less oil to leak out and it has more connections to allow the third oil collection vessel to begin receiving oil. With the addition of the new cap and the new vessel BP should be able to capture up to 53,000 bpd from the leaking well.

The new cap system is also supposed to have a disconnect system that will allow ships to disconnect quickly and move away should a new storm arrive. They would also be able to return quickly and reattach quicker thereby cutting the downtime significantly.

Regardless of the efforts to capture more oil we are quickly zeroing in on the final resolution by plugging the well at the bottom through the relief well process. Whether it is the 12th, 17th, 27th or sometime in August we are finally getting close. Personally I think BP is farther ahead than they are letting on and will surprise us with an announcement when they are ready to start pumping mud into the well. That should be a good day for BP once the live video of the LMRP finally shows no oil escaping.

BP got another reprieve today when the second tropical storm moved over land and dissipated rather than remain over the gulf and cause havoc with wind and waves. There are no storms under development today but this is the season and another one could show up at any time.

The drillers won another round today when the Appeals Court ruled against the administration and refused to stay the order from the lower court lifting the ban. The government had hoped to persuade the court to stay the order so Salazar would not risk contempt of court by issuing a new moratorium to get around the lower court's ruling. The court took about an hour to rule after hearing the government's arguments.

This means the Interior Department will probably issue a new moratorium with different parameters in an effort to start the process all over. The companies and gulf coast officials have already prepared a new challenge to any new moratorium but the lower court said it would not hear the challenge until the Interior Department actually issued a new moratorium. The plaintiffs are cocked and locked and will return to the initial court the instant Salazar releases the details of the new plan. They are going to claim Salazar and the administration are acting in contempt of the court's orders and supposedly that gives them greater odds of a more forceful decision the second time around.

Jim Brown

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