So What Does BP Agreeing to $20bil Escrow Tell Us About Prospects of Stopping The Oil Leak?

[Blackhatjack]

This is looking like a months long effort to stop a huge leak that will release millions of gallons of crude into the Gulf.

In that scenario the total losses could well exceed $20bil. This could look inadequate pretty quickly if the well casings are damaged and the relief wells fail.

The size of this disaster has not been accurately grasped by anyone yet, except maybe ... BP.

[aquart]

1. Yeah, 20 billion looked thin to me.

But I want every dime tomorrow, not on a payment schedule.

[damntexdem]

2. For one thing, that the $20 billion figure is not enough -- not if they agreed to it.

Beyond that, we don't need their agreement, or anything else BP might say, to know that the prospects are very, very bad.

[Golden Raisin]

3. Anyone actually think

that $20 billion will be anything more than insufficient pocket change compared to the real/actual end-cost of this horrendous ecological and human disaster?

[Statistical]

4. Relief well won't fail. It may take multiple attempts but relief well will seal the well.

If you can drill a well you can drill a relief well.

The only unknown is when...... the earliest possible date is August 6th however drilling problems, broken bit, weather, and missing well shaft can add delays.

Will it be delayed a week, a month, 6 months?

Ultimately relief well will seal this well.

[Blackhatjack]

14. The question is how deep will the relief well have to go to intersect with uncompromised well casing

One of the so-called oil well drilling experts raised the issue of how deep the relief well would have to go to intersect with solid, uncompromised well casings. He expained the relief well would have to do the equivalent of hitting a dinner plate from 2 miles away, and when the well off the coast of Mexico was stopped by a relief well they had to drill 5 relief wells before they hit it and could plug it.

The diagram I saw shows the relief well will have to hit it from an angle, and go through rock formations that might have already absorbed oil that was forced out of the damaged well's casings.

[Statistical]

15. BP has something the Mexicans didn't have in 1979.

Electromagnetic sounding.

They charge main well pipe with electricity.
Electricity in a pipe (wire) creates a magnetic field.

The relief well drill assembly has sensors to detect magnetic flux.
Essentially it works like a homing beacon.

There has never been a blowout that couldn't be sealed by relief well and BP has a backup well. It will get sealed just a matter of when.

[Blackhatjack]

20. Thanks for that explanation --why has this not been on the Tube?

Seems like a gamechanger as far as the likelihood that the relief wells will be successful.

[Statistical]

22. The expert BP is using only does relief wells.

Very talented and very highly paid per the conversation on TOD.

http://bp.concerts.com/gom/reliefwell060210.htm
Here he says he has done 40 relief wells and hit target 40 out of 40.

It is from BP but nobody else has any technical details. The media is apparently allergic to science.

[Poll_Blind]

5. AFAIK, absolutely nothing.

The situation with the gushing oil, itself, really wasn't touched on at all, AFAIK.

PB

[Blackhatjack]

6. BP Giving up the Annual Profits For 1 Year Is NOT ENOUGH To Fix The Damage Done...

This has been about managing expectations from the beginning, and the major chip that BP has played is that they have limited reliable information from being discovered by the Govt, news media and the public.

Once people realize how BIG this DISASTER is, they are going to realize how massive the damages are which should be paid by BP.

Don't forget the health claims that are guaranteed to arise from those involved in the clean up and spreading dispersants.

[dana_b]

10. that last line

"Don't forget the health claims that are guaranteed to arise from those involved in the clean up and spreading dispersants."

that's what worries me as much as anything else. No one knows what the effects of the oil and the chemicals will have on the workers much less the people who live in the area.

[emulatorloo]

7. It is one thing on the "To Do" list. Other DU'ers are reporting it is "20 Billion Fund with no cap"

Maybe they are wrong, but they watched the announcement on the news.

[gateley]

8. I think their attempt to actually stop it -- the Top Kill -- was the only plan

to do that. While awaiting the completion of the relief wells, they are siphoning off what they can (and they just increased the amount, I think).

So 'stopping the oil leak' probably won't be an option until August at the earliest. :shrug:

[jp11]

9. I'm pretty sure it was said the 20billion was for economic payement, business, tourism losses etc

and it isn't for the environmental cleanup. Plus lawsuits are still open for people, the government has the issue of fines etc and BP's claim to pay for the cleanup.

[emulatorloo]

11. Hopefully there will be a transcript soon, but yeah that is my understanding too.

Also apparently called the 20B a "good start", so that may not be the end of what BP will have to cough up to compensate Gulf residents.

[BrklynLiberal]

12. This had better be excluding any of the per gallon penalties that BP has to pay on the oil that has

filled the Gulf and the coast.

Those charges are a totally different matter....$100billion or more...

[Statistical]

17. Penalty is per barrel. No where near $100 billion.

40,000 to 60,000 bpd.

$4300 per barrel that is roughly $180 to $260 million per day. Split the difference is $220 million per day.

58 days = $12.76 billion so far.

If it is capped at say day 100 = $22 billion.

[BrklynLiberal]

21. yep. You are right.....Sadly, it is the optimistic guess that it might be capped at 100 days.

[inna]

13. Fine alone could be $30 billion or higher

(4 months at 100,000 barrels a day at $3,000 per barrel a day).

[Blackhatjack]

16. Well history shows liability being REDUCED for BP rather than uncapped...

Just look at the Exxon Valdese case. It took decades to resolve, and the court award was significantly reduced --- not to mention the number of people with legitimate claims who died without receiving a cent.

[limit18]

18. BP is delighted right now..."party time"

only cost them $20 bil and they don't have to plug the well.
Kick ass and take names!!!

[Joe Fields]

19. BP can agree to anything. Doesn't mean they will pay it out.

Doubt if they will survive as a multinational corporation long enough to pay out much of anything. They are going down the tubes.