x Abu Dhabi, UAEMonday 24 July 2017

Obama vows BP will pay for oil spill

The UK's biggest oil company is "ultimately responsible for funding the cost of the response and clean-up operations".

The US president Barack Obama said BP must foot the bill for cleaning up the oil spill from one of its wells in the Gulf of Mexico, as public anger mounted and crude prices moved higher. Europe's Brent crude closed at US$87.03 on Friday, and New York's main crude contract rose to $85.62, after the US commerce department said the US economy had grown by 3.2 per cent in the first quarter.

But BP, the UK's biggest oil company, did not benefit. BP was "ultimately responsible for funding the cost of the response and clean-up operations" in the Gulf, Mr Obama said, calling for the "strongest possible response" from the company. He said his administration would "continue to use every single available resource" to address the incident, the worst oil-related disaster in US waters in more than two decades.

On Friday, the US defence secretary Robert Gates approved a request from Bobby Jindal, the Louisiana governor, to mobilise up to 6,000 National Guard soldiers to fight a huge oil slick that reached shore in Mississippi and Louisiana yesterday. "The government will hold BP accountable for the costs," said Geoff Morrell, a spokesman for the defence department. Other officials were more succinct. "Under the Oil Pollution Act, BP pays for all this," said the White House press secretary Robert Gibbs.

Mr Jindal said BP's resources were "not adequate" to stop the leak of as much as 5,000 barrels per day of oil from a sunken drilling platform, protect the threatened coastline and swiftly mop up the slick. Ken Salazar, the US interior secretary, said he had pressed the chief executives of BP and the US contractors Transocean and Halliburton, which had worked on the oil well that blew out on April 20 in 1,500 metres of water, "to work harder and faster and smarter to get the job done".

The three companies face at least 36 lawsuits, including group actions, over the spill. "We cannot rest and we will not rest until BP permanently seals the wellhead and until they clean up every drop of oil," Mr Salazar continued. "I have asked other companies from across the oil and gas industry to bring their global expertise to the situation." On Friday, BP began to apply a chemical dispersant close to the biggest leak to break up the oil and send it to the sea floor or bring it to the surface, where clean-up is easier. Nalco, a West Virginia chemicals firm, is custom manufacturing the dispersant for BP.

Tony Hayward, the chief executive of BP, pledged to compensate everyone affected by the disaster. "We are taking full responsibility for the spill and we will clean it up, and where people can present legitimate claims for damages we will honour them," Mr Hayward told Reuters. "We are going to be very, very aggressive in all of that." The company has lost at least US$20 billion (Dh73.45bn) in market capitalisation in the past week, with its share price falling by more than 13 per cent.

If not controlled by mid-June, the BP spill could exceed the 260,000 barrels released off Alaska's coast in 1989 when the oil tanker the Exxon Valdez ran aground in Prince William Sound, causing the biggest US oil spill to date. tcarlisle@thenational.ae