April 4, 2011

BP To Resume Drilling In The Gulf

BP is expected to resume deepwater drilling in the Gulf of Mexico in July, the Sunday Times reports.

The paper reported on Sunday that BP is said to have granted 24-hour access to U.S. government overseers and pledged to meet safety requirements that go beyond tougher rules imposed after the accident that took place in April 2010.

Charlie Kronick, a spokesman for Greenpeace, said that the news was "a poke in the eye not only to the environment but to investors". He told msnbc.com: "It has been a year now and 80% of that oil is still somewhere in the sea. There is nothing different about the situation now other than regulators may keep a slightly beadier eye on operations."

A source close to the company told the Sunday Times: "BP is hoping to resume drilling in the summer once it shows it can satisfy applicable regulatory conditions, as set out by the US offshore regulator."

The newspaper also reported that BP will initially be allowed to only maintain or increase production on existing wells, ruling out exploration projects.

Michael Bromwich, BOEMRE director, told The Guardian: "The progress in permitting deepwater drilling is directly related to industry's ability to meet and satisfy the enhanced safety requirements associated with deepwater drilling, including the capability to contain a deepwater loss of well control and blowout."

BP's chairman Carl-Henric Svanberg said last month that the 2010 Gulf of Mexico oil spill caused by the Deepwater Horizon oil rig was no reason to stop deep sea drilling.

"If we truly learn from this accident, I see no reason to close off the deep water as an area for future oil exploration and production," Svanberg told a conference on oil spill risk management.

He took over as chairman of BP a few months before the April 20 explosion.

The oil spill killed 11 workers and spilled 4.9 million barrels of oil into the Gulf over a three-month period.

BP still faces having to pay compensation costs totaling tens of billions of dollars.  The British company is spending about $41 billion on cleaning up the spill and to cover damages caused by the incident.

Transocean, the firm that operated the Deepwater rig, was reported last week to have awarded millions of dollars in bonuses to its executives after "the best year in safety performance in our company's history."

"Notwithstanding the tragic loss of life in the Gulf of Mexico, we achieved an exemplary statistical safety record as measured by our total recordable incident rate and total potential severity rate," Transocean said in the filing.

"As measured by these standards, we recorded the best year in safety performance in our company's history, which is a reflection on our commitment to achieving an incident free environment, all the time, everywhere."


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