Yeah, there’s a thick 3-inch layer of oily residue covering large parts of the Gulf of Mexico. Just thought you should know. NPR’s got the story.
The following video has been labeled “The Most Important Video You’ll Ever See.” Hyperbole? It’s just a lecture on math, given by a Professor Emeritus of Physics at the University of Colorado-Boulder. It explains how just a 7% annual growth in energy use equals a 100% growth in 10 years. After a few decades, you’ve got a really big number. And a tremendously enormous problem. Watch and learn, please.
[H/T Peter Hufnagel]
Breaking news from the A.P. It happened about 9:30 this morning, and planes, helicopters and ships are now en route to the site. That’s all the information we have at the moment.
According to this exclusive report on CNN, the seafloor of the Gulf of Mexico about 40 miles west of Panama City, FL is a toxic sludge composed of speckled droplets of dispersed oil… moving east.
[H/T Ryan Bartek]
While the right-wing media machine diverts our attention to the “Ground Zero Mosque” and “anchor babies,” our magpie brains are forgetting about the Deep Horizon disaster. More importantly, we’re forgetting about the genesis of this disaster – the rampant deregulatory culture, the lax safety procedures – which, we might say, are features of the contemporary media culture as well, which chases sham political controversies instead of concentrating on matters of true importance.
Okay, it’s like this. The main reason we’re in a Great Recession is that, back in 1999, the U.S. government compromised itself to death. Bill Clinton wanted to increase lending to minorities. The Republican-controlled Congress (swept into office by Newt Gingrich’s “Contract with America”) said, “Only if you decrease regulation at the same time,” and so Phil Gramm (appointed senior economic adviser to McCain’s presidential campaign) drew up a bill that gutted Glass-Steagall, the 1933 act that prevented the Depression from happening again. President Clinton, weakened by the Monica Lewinsky scandal, didn’t have much wiggle-room in the Oval Office any more, and signed the legislation.
So, naturally, you get a huge housing boom totally based upon dodgy accounting and ludicrous credit standards which blows up in the world’s face.
You can’t make this stuff up, right?
Guess what. The BP oil spill is a result of exactly the same legislative deathmatch. The New York Times has a superb piece this morning by David S. Abraham declaring, this is a disaster that Congress voted for. In a highly balanced and nuanced argument, Abraham details how Congress really and truly has been addicted to providing the oil industry with economic incentives beyond all reason:
In a 1995 attempt to encourage more exploration, Congress agreed to reduce the cut of the proceeds the government could collect on oil and gas drilling in deep waters. Ten years later, despite higher oil prices and declarations from President George W. Bush that more incentives were not needed, a Republican-led Congress reduced royalties yet again.
It’s madness, of course – especially when
at the same time that Congress called for new drilling incentives, it also gutted oversight. From 2002 to 2008, legislators approved budgets reducing regulatory staffing levels by more than 15 percent… A 2004 Coast Guard study found that its “oil spill response personnel did not appear to have even a basic knowledge of the equipment required to support salvage or spill clean-up operations.”
When Bobby Jindal calls for more offshore drilling in order to help pay for coastal damage inflicted by offshore oil-and-gas operations (yeah, you read that right), then we have truly entered a land of the comedic insane, where the Mad Hatter starts writing Catch-22 contracts. The astounding thing is that, at base, it’s an exquisitely simple recipe for disaster: radically lower the barriers to enter the market, while radically de-regulating (by which we mean: knocking down the laws and rules that govern participation in this country’s economy) and what you get are toxic assets. That’s what we call a house, these days: a toxic asset, destroying the person who possesses it (for D&D fans, that’s kind of like a poisoned amulet, except with lots of bricks and mortar and wiring and plumbing).
But we should be calling the oil spill a toxic asset too. The definition’s more apt; no metaphors needed here. It’s a natural resource that’s killing our economy and destroying the ecosystems of our oceans. It’s a substance that, for decades now, has powered our economy; now it’s bringing the Gulf to a standstill. It’s the toxic asset, our home mortgage that’s underwater. The rich will probably walk away from it, their dirty souls skimming the tops of the oily waves in that Gulf between them and us.
If you listen to the media storm at the moment, a lot of people are debating whether or not these relief wells will finally shut down the gushing oil in the Gulf of Mexico. Tomorrow is the fourth of July, so I wanted to impart you with a little bit of optimism to share around the grill. For weeks, the progress of both relief wells have been ahead of schedule, and the first well is only hundreds of feet from it’s target. It isn’t a certainty, but in this case the technology BP is using to stop the well is actually a technology they heavily invest in, drilling. If there is one thing they have progressed in the last 30 years, it’s the ability to make big holes.
And now BP has been letting it slip that they may reach the beast and stop it sometime in July. Jordan Burke and Jessica Resnick-Ault write for Bloomberg Businessweek
The target date for intercepting the leaking well and pumping in mud and cement to permanently seal it is still mid- August, U.S. National Incident Commander Thad Allen said today on a conference call with reporters. The well is within 600 feet (182 meters) of intercepting the leak, he said.“They are ahead of schedule at this point,” Allen said. “I am reluctant to tell you that it will happen before the middle of August because I think that everything associated with this spill and response recovery suggests that we should under- promise and over-deliver.”BP diverted 25,150 barrels of oil from the leaking well to surface vessels yesterday. The Macondo well is estimated to be spewing 35,000 to 60,000 barrels a day, according to a government-led panel of scientists. The well started leaking after an April 20 explosion on the Deepwater Horizon, causing the drilling rig to sink and killing 11 crew members.Royal Bank of Scotland Group Plc analysts David Cline and Barry MacCarthy said the first relief well may be completed between July 7 and July 12, according to a note to clients yesterday. Pritchard Capital Partners LLC analysts Brian Uhlmer, Anuj Sharma and William Conroy said in a June 29 note that the well would be intercepted between July 7 and July 9.
A lot of folk have been trying to convince me that pension funds are dividing Americans from their friends across the pond. I think a lot of it is media driven, a common phrase I don’t use very often. Maybe I should.
If you ask me, you shouldn’t gamble with retirement. If your savings are investing, that isn’t the same as a savings account. Risk is risk. Anyhow, have fun reading the Guardian,
In the 59 days since the oil leak in the Gulf of Mexico, Hayward has been transformed into one of the most hated men in the US, and the ferocity of the encounter between him and the House of Representatives committee on energy and commerce was much-anticipated. As one committee member noted: “The anger at BP is at fever pitch. It’s almost palpable.”
The committee has been conducting an aggressive inquiry into the gusher, and called Hayward in to answer specific charges of suspected safety lapses and shortcuts in the design plan of the well in the days before the explosion on the ill-fated Deepwater Horizon rig.
But Hayward, who had been carefully coached by legal and media teams and was testifying under oath, failed to satisfy.
“The committee is extremely frustrated with your lack of candour,” Bart Stupak, who is leading the investigation told him. “You are the CEO. You have a PhD. We hope you have more candour in your responses.”
The reprimand was just a taste of the rancour towards Hayward. He was told by angry committee members that BP had a history of cavalier disregard for environmental rules and workers’ safety.
Hayward’s claims to have ushered in a new regime of safety after taking over as chief executive of the company in 2007 were plainly ridiculed.
“When I heard of the explosion in the Gulf, the name that immediately popped into my mind was BP,” said Stupak.
There was even an apology from Re. Joe Barton, the Republican from Texas who now has Rep. Jeff Miller calling for him to step down from his post on the Energy and Commerce Committee.
The Guardian reports quite a heavy bill for BP, and this may really set a buzz for the President’s fist Oval office speech tomorrow.
BP is facing a bill of up to $34bn from the Gulf of Mexico disaster after US senators demanded the oil company deposited $20bn into a ring-fenced account to meet escalating compensation costs.
The sum dwarfs many analysts’ previous estimates, shared by BP, that put the cost of the clean-up effort and payment of damages to affected communities, such as fishermen, closer to a total of $5bn.
Shares in BP nose-dived by more than 9% today as investors took fright at the demand by the 54 Democratic senators, who represent a majority in the US upper house. The company is now worth almost half what it was before the accident of just under two months ago.
BP already faces up to $14bn in civil penalties, payable under US environmental law, assuming the leak is plugged in August. These punitive damages are directly linked to the size of the spill – already estimated at being up to eight times worse than the Exxon Valdez disaster in 1989 – with BP liable for up to $4,300 for each barrel-worth spilt.
Senate leaders insisted the $20bn ring-fenced account should be exclusively for “payment of economic damages and clean-up costs” and should not be seen as a cap on BP’s other legal liabilities. With punitive damages pending too, the theoretical total of $34bn is equivalent to more than half the corporation tax paid by all British companies last year.
Tony Hayward, chief executive of BP, and other directors of the company, will meet Barack Obama at the White House on Wednesday prepared to offer concessions in the hope of taking the sting out of mounting political attacks on the company.
BP will be in “listening mode”, willing to cut its next dividend, worth about $2.5bn, possibly paying the cash into the clean-up fund. It will also reiterate its commitment to paying all legitimate claims arising from the disaster. But the company does not believe that the demand by the senators to stump up $20bn is justified.
An upcoming report intends to warn the Gulf Coast of a looming disaster that may dwarf the current BP gusher. 31,000 miles of under sea pipes move over a billion dollars of oil a day around the Gulf of Mexico, and much of it is crumbling apart. This new study suggests under water currents from a hurricane could be enough force to wreak havoc on an aging infrastructure that is being dug out of the ocean floor by the passage of time.
Based on unique measurements taken directly under a powerful hurricane, the new study’s calculations are the first to show that hurricanes propel underwater currents with enough oomph to dig up the seabed, potentially creating underwater mudslides and damaging pipes or other equipment resting on the bottom.
At least 50,000 kilometers (31,000 miles) of pipelines reportedly snake across the seafloor of the Gulf of Mexico. Damage to these pipelines can be difficult to detect if it causes only smaller leaks, rather than a catastrophic break, the researchers say. Repairing underwater pipes can cost more than fixing the offshore oil drilling platforms themselves, making it all the more important to prevent damage to pipelines in the first place.
The researchers, at the U.S. Naval Research Laboratory at Stennis Space Center, Mississippi, got an unprecedented view of a hurricane when Hurricane Ivan, a category-4 storm, crossed the Gulf of Mexico in 2004. The eye of the storm passed over a network of sensors on the ocean floor, put in place to monitor currents along the continental shelf in the Gulf.
The research team found that strong currents along the sea floor pushed and pulled on the seabed, scouring its surface. “Usually you only see this in very shallow water, where waves break on the beach, stirring up sand,” says David Wang, co-author of the study. “In hurricanes, the much bigger waves can stir up the seafloor all the way down to 90 meters [300 feet].”
Ivan’s waves on the surface created powerful currents that dug up the seafloor. Acoustic measurements using sound waves showed that these currents lofted a lot of sediments, which clouded the water up to 25 meters (82 feet) above the seafloor. The team’s seafloor sensors tracking the pressure underwater experienced a big increase, as well. This showed that the ground was washed away beneath the sensors, causing them to sink into a lower, higher-pressure zone.
BP is agressively searching for friends and subscribers on YouTube and they are sparing no expense. All day their video adds have plagued my monitor, so I took a moment to see how their newest upload is fairing with the public. You really have to marvel at the PR challenges in this Internet age, and notice just how easy Exxon had it when the spilled a tanker load off the coast of Alaska. Can an energy company survive online criticism as well as Paris Hilton? I would say yes, but this ongoing predicament is like a thousand unflattering club photos every day.
Pretty soon people will hate BP so much they will demand it gets a reality television show. Dancing with the Pelicans with CEO Hayward and Doug Suttles as judges. Now you the audience at home has a vote, and I suggest you make it. Click the picture before feedback is disabled.
Looks like somebody read Gov. Bobby Jindal’s letter. President Obama is soon to announce the new rules for moderate depth off shore drilling as early as this week, lifting the freeze on coastal exploration. You may recall a spokesperson for BP this weekend called the halt on exploration sensible, but hoped for a quick prognosis and reform in order for the industry to plan for the future. The White House didn’t miss a beat. Let’s hope when it comes to the bigger depths they include a mandatory relief well to accompany production as they do in some parts of Canada. Response Coordinator Admiral Thad Allen suggested that was a good idea just yesterday.
WASHINGTON—The Obama administration, facing rising anger on the Gulf Coast over the loss of jobs and income from a drilling moratorium, said Monday that it would move quickly to release new safety requirements that would allow the reopening of offshore oil and gas exploration in shallow waters.
Gulf Coast residents, political leaders and industry officials said delays in releasing the new rules, along with the administration’s six-month halt on deepwater drilling—both issued amid public pressure—threatened thousands of jobs.
Well-owner BP PLC, meanwhile, faces penalties “in the many billions of dollars,” for the Deepwater Horizon drilling disaster that has been spewing an estimated minimum 12,000 to 19,000 barrels of oil a day into the Gulf, said White House Press Secretary Robert Gibbs. The costs of the spill will “greatly exceed” the amount BP could recoup by selling any of the captured oil on the market, he said Monday.
BP is to hive off its Gulf of Mexico oil spill operation to a separate in-house business to be run by an American in a bid to isolate the “toxic” side of the company and dilute some of the anti-British feeling aimed at chief executive Tony Hayward, the company said today.
The surprise announcement was made during a teleconference with City and Wall Street analysts in which Hayward attempted to shrug off the personal criticism saying words “could not break his bones”.
BP has faced mounting anger in the US over the accident on 20 April when the Deepwater Horizon rig blew up and sank with the loss of 11 oil workers’ lives.
The Macondo well continues to spew out oil although a containment cap was placed on top of the leak today. Hayward said it would take a further 48 hours to know whether it was successful.
Responsibility for the leaking well and the clean-up strategy will placed in the hands of Bob Dudley, one of the company’s most able directors.
Dudley, a US citizen, has been looking for a suitable role in the company since he was thrown out of Moscow in a battle with the Russian shareholders of the TNK-BP joint venture in the middle of 2008.
Hayward said the clean-up business would be run separately by Dudley with his own staff but the finances and budget would come from the main BP group. The BP chief executive said the purpose of the split was to allow Dudley to concentrate on the Gulf problem while he and other directors were not distracted from keeping the main business on track.
With all this oil in the Gulf, all the terrifying pictures, footage, and reports its easy to forget the real victim here. That’s right, I’m talking about a sensitive affluent little business with a previously bright future, British Petr- I mean Beyond Petrolium. Once the most profitable company in the entire history of the world, BP now faces stock slides, falling credit and bond ratings, and a possible death by cannibalism.
The downturn began on Tuesday, after BP’s “top kill” plan failed to block a massive leak in the Gulf of Mexico by pumping mud into the well.
But BP’s bonds continued to fall even as its shares recovered on Wednesday.
Meanwhile, rating agency Fitch has cut the firm’s credit rating marginally, and threatens further downgrades if the cost of the oil leak rises further.
Fitch cut BP’s rating by one notch, from AA+ to AA, although this is still one of its highest investment grade credit ratings.
The other two main rating agencies – Moody’s and Standard & Poor’s – also still rate BP’s creditworthiness highly, at Aa1 and AA respectively.
Yet bond markets are now pricing BP’s debts at levels comparable with much riskier “junk” rated companies.
The oil company’s main five-year dollar bond was trading on Thursday at a yield of 5.5% – some 3.25% more expensive than the interest rate that the US government would have to borrow at.
Yet before the weekend, the same BP bond was trading at a yield of 3.5%, meaning its borrowing cost has jumped by 2% as a result of the failure to plug the oil leak.
One City analyst told the BBC that the bond markets’ fears made no sense, because BP has so little debt.
BP owes £14bn in total debts, whereas stock markets currently value the company at £84bn.
read more at the BBC
With a looming bills, suits, and fines to stack on the one billion dollars the company hs already spent on the disaster, and a 1-5 thousand dollar fine per barrel, one has to wonder how this company could fend off its competitors who would like nothing more to consume their business. Check out their new ad, and take a good look at it’s narratar, BP CEO Tony Hayward, because he might not be the face of the company for long.
Hashank Bengali writes for McClatchy,
The Obama administration late Wednesday moved swiftly to plug a hole in its much touted six-month ban on new deepwater drilling when the Interior Department ordered oil companies to overhaul and resubmit dozens of exploration plans that had already been approved but were virtually identical to BP’s and that called major spills and environmental damage “unlikely.”
The action came after McClatchy informed the White House and Interior officials that it had reviewed 31 deepwater exploration and development plans approved for the Gulf under the Obama administration and found that all of them downplayed the threat of spills to marine life and fisheries.
The language scarcely varied from company to company, suggesting that the plans were pumped out like boilerplate. Of the 31 plans McClatchy reviewed, 14 were approved since the April 20 explosion on BP’s Deepwater Horizon oil rig,
The administration had failed to include the plans in its moratorium, and experts told McClatchy that the filings could clear the way for drilling new wells when the ban was lifted. Following inquiries by McClatchy to White House and Interior officials, the Bureau of Land Management announced late Wednesday that oil companies would need to resubmit the plans with additional safety information before they’d be allowed to drill new wells.
“Pulling back exploration plans and development plans and requiring them to be updated with new information is consistent with this cautious approach and will ensure that new safety standards and risk considerations are incorporated into those planning documents,” BLM Director Bob Abbey said in a brief press release.
In the White House’s initial response to McClatchy’s inquiries, spokesman Ben LaBolt said only that a presidential commission investigating the BP spill would also “assess exploration and production plans and could provide options for ways to improve their development and review.”
Less than half an hour later, the Interior Department issued its press release, which came from the BLM, not the Minerals Management Service.
After lodging a diamond studded saw a mile underneath the ocean into the riser pipe, BP managed to finnish their cut. Initial reports from the New York Times suggest the saw actually became mired in the very same junk BP injected into the leak in hopes of jamming it. The Wall Street Journal reports,
Overnight, the response team was able to “successfully” make the first shear cut of the pipe, U.S. Coast Guard Adm. Thad Allen, the national incident commander for the spill, said at a news conference in Houma, La., Wednesday morning.
However, a specialized saw had got stuck while making a second fine cut that is needed before a containment device can be put in place.
Adm. Allen said the goal was to finish the cut by the end of the day Wednesday. A containment device would go over the top of the wellhead once the second cut is complete and is designed to channel oil up to a ship on the surface.
Meanwhile, Louisiana’s Republican governor, Bobby Jindal, said Wednesday that the White House approved a longstanding request to force BP to pay for another five sand barriers designed to protect the Louisiana coastline from oil.
Just when you thought this Bad News Bears nightmare was over, BP’s diamond studded saw became stuck while it was cutting through the riser today during the latest attempt to halt the flow of oil in the Gulf. I’m waiting for them to remind us it has never been tried at this depth, but how could that completely flummox them while cutting a riser?
Apparently the answer to that question is that it didn’t. The real problem today was that the blade had become dulled on the various contents of the pipe, most probably the same junk BP has been shooting into it for a week. Good Lord!
A technician involved in the effort said that the wire saw had cut less than halfway through the riser when it stopped being effective. The technician, who spoke on condition of anonymity because he was not authorized to comment on the work, said that it appeared that there was other material in the riser — including, perhaps, some of the objects pumped into the well during the failed “top kill” procedure last week — that was dulling the saw.
“It was cutting at a rate far less than it should have,” he said.
The technician said that rather than trying again with the saw, the plan now was to use a large shear to cut the riser. The shear, which is about 20 feet long and nearly 10 feet high, was used to make an earlier cut in the riser about 50 feet from the wellhead.
After several reports of its demise, the Climate Bill is back on the burner. The president made a speech in its support today at Carnegie Mellon University . If Obama passes this one, he will be known as the President of reanimated zombie bills. Speaking of familiar, Republican support for the bill is no where to be found since Sen. Lindsey Graham backed off from Sen. Kerry’s shadow, but there are a pack of moderates targeted for swinging sides. Mentioning them, Obama said, “The votes may not be there right now, but I intend to find them in the coming months,”
While he had the microphone, he took the time to outline some of his ideas for the legislation. The President said he would like to roll back the oil tax breaks and use that money to invest in our energy independence. This is something that has been talked about during drum circles for over four decades, but this time the talk may become law in the wake of the disaster in the Gulf.
Here is an excerpt from his speech,
And the time has come to aggressively accelerate that transition. The time has come, once and for all, for this nation to fully embrace a clean energy future. (Applause.) Now, that means continuing our unprecedented effort to make everything from our homes and businesses to our cars and trucks more energy-efficient. It means tapping into our natural gas reserves, and moving ahead with our plan to expand our nation’s fleet of nuclear power plants. It means rolling back billions of dollars of tax breaks to oil companies so we can prioritize investments in clean energy research and development.But the only way the transition to clean energy will ultimately succeed is if the private sector is fully invested in this future — if capital comes off the sidelines and the ingenuity of our entrepreneurs is unleashed. And the only way to do that is by finally putting a price on carbon pollution.No, many businesses have already embraced this idea because it provides a level of certainty about the future. And for those that face transition costs, we can help them adjust. But if we refuse to take into account the full costs of our fossil fuel addiction — if we don’t factor in the environmental costs and the national security costs and the true economic costs — we will have missed our best chance to seize a clean energy future.The House of Representatives has already passed a comprehensive energy and climate bill, and there is currently a plan in the Senate — a plan that was developed with ideas from Democrats and Republicans — that would achieve the same goal. And, Pittsburgh, I want you to know, the votes may not be there right now, but I intend to find them in the coming months. (Applause.) I will continue to make the case for a clean energy future wherever and whenever I can. (Applause.) I will work with anyone to get this done — and we will get it done.
Could we see some executives go to jail? Eric Holder seems to think so. Department of Justice is on the case.
Justin Blum and Aaron Kuriloff write for Bloomberg,
The Justice Department is investigating whether any criminal or civil laws were violated in the BP Plc oil disaster in the Gulf of Mexico, the biggest U.S. spill on record, said Attorney General Eric Holder.
“We will prosecute to the fullest extent of the law, anyone who has violated the law,” Holder said. “This disaster is nothing less than a tragedy.”
Holder announced the investigation today at a news conference in New Orleans, the same day President Barack Obama called the spill “the greatest environmental disaster of its kind in our history.” The president said, “My solemn pledge is that we will bring those responsible to justice.”
The spill began after an April 20 explosion aboard the Deepwater Horizon rig, which London-based BP leased from Switzerland-based Transocean Ltd. to drill its Macondo well in the Gulf. Houston-based Halliburton Co. provided oilfield services on the well.
Holder, who said the probe “began some weeks ago,” declined to specify which companies are under investigation. He said he surveyed a portion of the damage, was briefed by Coast Guard officers and met with prosecutors for the areas affected by the spill.
The Justice Department will ensure that taxpayer money will be repaid and that damage to the environment and wildlife will be reimbursed, Holder said. The government already has told “all relevant parties” to preserve documents that may “shed light on the facts surrounding this disaster,” Holder said.
BP plunged the most in 18 years in London trading, losing 13 percent to 430 pence. Transocean dropped 12 percent to $50.04 in New York Stock Exchange composite trading. Halliburton fell 15 percent to $21.15.
Our friends at Gratuitous Art Productions have chopped up a fun piece about the head to head battle between man and nature currently raging in the Gulf. Enjoy!