BP: Still Installing Cap, Helix Producer Collecting Oil

(Updates with more details and comments from BP executive) By Cassandra Sweet and Susan Daker Of DOW JONES NEWSWIRES BP PLC (BP, BP.LN) said Monday that it has started collecting oil from the Helix Producer vessel and aims to complete installation of a new sealing cap later in the day as part of efforts to stop oil from gushing out of a broken well in the Gulf of Mexico. The new cap is the U.K. oil giant's latest attempt to stop the flow of oil from the Macondo well while the company drills relief wells nearly a mile below the surface that it hopes will permanently plug the leak. Federal and independent scientists have estimated that between 35,000 and 60,000 barrels of oil have been flowing into the Gulf from the broken well each day. The Helix Producer ship has been containing oil since 11 a.m. local time and is expected to capture up to 25,000 barrels of oil a day, said BP Chief Operating Officer Doug Suttles. The new vessel will allow up to 33,000 barrels of oil a day to be captured or burned, Suttles said. Bad weather and technical problems delayed starting up Helix Producer containment operations. Another ship, the Q4000, and a more loosely fitting cap that was removed Saturday to allow installation of the new device, have managed to capture about 25,000 barrels of oil a day. With the new cap and other measures, BP has said it expects to be able to recover 60,000 to 80,000 barrels a day within two to three weeks. With the old cap off, oil is flowing freely into the Gulf from the well head, although a team of about 50 skimmers is working to catch the oil when it reaches the surface from the leak nearly a mile below the surface at the sea floor, while other oil is burned off. Once the new cap is installed, BP will perform a series of integrity tests to determine whether and how much oil is flowing through the well casing, Suttles said. If the pressure in the casing is high, that's a good sign and shows the wellbore is intact and pulling up all, if not most, of the oil flowing out the Macondo well, Suttles said. If the pressure is low, it means oil is escaping from the casing, he said. If the cap is successful, the well will be closed in and no more oil will leak out. But if oil is still leaking out of the well after the cap is in place, BP will resume using the containment ships, which it could reconnect "relatively quickly," Suttles said. "We all agreed we needed integrity tests, to avoid the risk that oil could come through the well bore," Suttles said, speaking to reporters by telephone. "We'll analyze those results and determine whether we need to keep it closed in or resume containment operations." A key risk for the new cap is that hydrates might form at the bottom of the capping stack, preventing the cap from properly latching shut, Suttles said. The company plans to inject glycol to prevent hydrates from forming, but "until we've completed it, that risk sits there," Suttles said. The entire operation, started Saturday, should be finished within one to four days, Suttles said. Suttles stressed that no matter how things work out with the cap, the company is still placing its faith in the ability of a relief well to permanently kill the overflowing well. The relief well will likely be finished between the end of the month and mid-August, Suttles said. BP has been working to contain the leak for more than 12 weeks after Transocean Ltd.'s (RIG) Deepwater Horizon exploded and sank, killing 11 workers and unleashing the spill that has fouled the coasts of at least four states and killed sea creatures and birds. -By Cassandra Sweet and Susan Daker, Dow Jones Newswires; 415-439-6468; cassandra.sweet@dowjones.com (END) Dow Jones Newswires July 12, 2010 17:01 ET (21:01 GMT)