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2nd UPDATE: BP Resumes Collecting Oil At Vessel On Spill Site

Sat, 19th Jun 2010 00:44

(Updates with new details about amounts of oil and gas captured from the leaking well as well as amount of claims paid by BP.) HOUSTON (Dow Jones)--BP Plc (BP, BP.LN) said that 8,480 barrels of oil were recovered and 16.9 million cubic feet of natural gas were flared between midnight and noon on Saturday, as a large drillship that stopped collecting oil overnight due to a malfunction resumed operations. The Discoverer Enterprise, a drillship that collects oil and flares natural gas from a mile-deep well in the Gulf of Mexico through a long pipe, stopped operating Friday after a flame arrestor--a device designed to keep oil from burning--stopped late Friday, diminishing the rate at which the company recovered oil. The ship's work restarted at 6.30 a.m. CDT and "has been building up to stable rates since," BP said in a press release Saturday afternoon. A second, smaller collecting vessel, the Q4000, continued operating throughout the interruption, BP said. BP said that about 24,500 barrels of oil were captured Friday. Some 14,400 barrels were collected, and 10,100 barrels were flared. In addition, the company flared about 47.4 million cubic feet of natural gas. The technical hiccup came a day after BP captured a record amount of oil--more than 25,000 barrels of oil Thursday--after bringing in the Q4000. The company was expecting to ramp up its recovery rate to more than 50,000 barrels a day by the end of the month and to as much as 80,000 by mid-July by bringing in additional equipment. BP spokesman Robert Wine said that the ramp up back to full capacity will be "steady and cautious," in order to avoid undue risk. The interruption underscores the complexity--and fragility--of the oil-collecting operation, which mitigates some of the effect of the spill, currently estimated at between 35,000 and 60,000 barrels per day. BP is under intense pressure to contain a spill that continues to grow nearly two months after its leased rig, the Deepwater Horizon, exploded and sank some 50 miles from the Louisiana shore, killing 11 and generating the worst environmental disaster the area has seen. Even as collection efforts at the surface intensify, BP is moving forward with a parallel strategy to permanently shut down the leaking well by intersecting it with another well and flooding it with cement. Currently that relief well is moving ahead of schedule, but the drilling operation will have to slow down in coming days as it enters a critical phase, BP Chief Operating Officer Doug Suttles said in a conference call Friday. BP, which has been criticized for slowness and disorganization in its effort to keep the oil from reaching the shore, received harsh words from Plaquemines Parish President Billy Nungesser on Saturday. He said that dozens of workers were sitting idle on boats at a staging area in Myrtle Grove, La., where response boats usually depart for Barataria Bay, despite having "fine" weather at 10 a.m. "This is infuriating. We continue to stress how important it is to get out early and at 10 a.m. no one was out on the water yet," Nungesser said in a statement. "There's no sense of urgency." BP's Wine confirmed in an email that some workers were standing down. "Weather has been an issue around the area today and we will not send people out if storms are in the area. Some Parish divisions were out operating, but called back due to weather concerns." The company said in a press release Saturday that it has paid $104 million in damage claims to residents of the Gulf Coast since the spill began. The company has set up 33 claims offices in the region, and 1,000 people are working to process the more than 64,000 claims that have been received to date. On Friday, Kenneth Feinberg, the government-appointed administrator for a $20 billion BP-funded escrow destined to compensate Gulf residents for their loss, said he would try to build on the claims system the company has set up to make reimbursements speedier. -By Angel Gonzalez, Dow Jones Newswires; 713-547-9214;angel.gonzalez@dowjones.com (END) Dow Jones Newswires June 19, 2010 19:44 ET (23:44 GMT)

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