While BP engineers evaluate whether the plug will hold, enabling them to further restrain the leakage from the blown-out well, investors get a respite to consider whether BP’s collapsed stock price presents a buying opportunity.
Crude oil that has accumulated from leakage of an estimated 19,000 barrels a day, since the blowout April 20, has already reached the Louisiana outer islands. Even assuming the plug holds, the well must be cemented and sealed, in order to stop leakage into the ocean permanently.
Hurricane Season Could Make BP Disaster a Perfect Storm
There remain many uncertainties about how to shut down the flow, in order to begin the disaster recovery. With the announcement by the National Oceanic and Atmospheric Administration (NOAA) that this year’s hurricane season could be extremely active, a new complication threatens. More and more, this disaster is taking on aspects of a perfect storm.
The blowout occurred when the Transocean, Ltd. $350-million drilling rig, Deepwater Horizon, exploded and caught fire. It happened before BP’s 18,000-ft. well could be completed. The well pressure blew crude oil through a defective blowout preventer at the wellhead, manufactured by Cameron International.
The burning rig sank two days later, 45 miles from the Louisiana shore. Eleven workers lost their lives in the accident.
Well Leaked Over Half Million Barrels from April 20 to May 27
Maurice McNutt, Director of the US Geological Survey, speaking for the federal advisory commission appointed by President Obama to investigate the disaster, reported on May 27 that 12,000 to 19,000 barrels of oil and condensates per day had leaked into the sea. This is a much higher than earlier estimates, and there are some above 20,000 barrels per day.
The drifting crude oil and condensates are a threat to harm sea and associated land life in the entire GOM, as well as contaminate shorelines and marshes of the five states contiguous to the Gulf of Mexico – Texas, Mississippi, Louisiana, Alabama, and Florida.