Oil cleanup hampered by hurricane

Published Jul 2, 2010

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By Ernest Scheyder

Venice, Louisiana - Hurricane Alex slowed oil clean-up and containment efforts in the Gulf of Mexico, with any permanent fix to BP's ruptured deep-sea oil well still several weeks away.

The hurricane made landfall over northeastern Mexico late on Wednesday, its high winds and the rough seas delaying the British energy giant's plans to expand the volume of oil it is syphoning from the leaking well.

Alex is forecast to dissipate over Mexico in the next day or two.

The bad weather also threatened to push more oil-polluted water onto the shoreline of the US Gulf Coast and forced the halting of skimming, spraying of dispersant chemicals and controlled burns of oil on the ocean surface, officials said.

The worst oil spill in US history is in its 73rd day. It has caused an environmental and economic disaster along the US Gulf Coast, hurting fishing and tourism industries, soiling shorelines and killing wildlife.

President Barack Obama was scheduled to meet with senior US officials on Thursday to review the spill situation and oil containment plans, the US Coast Guard said.

Interior Secretary Ken Salazar said on Wednesday one of two relief wells being drilled by BP in a bid to stop the leak from the ruptured well will take several weeks to reach the spewing oil pipe. The relief wells are intended to intersect and then plug the leak.

BP kept oil-capture and relief well drilling operations going at the leak site through the bad weather.

BP's market capitalisation has shrunk by about $100-billion and its shares have lost more than half their value since the spill began on April 20 but are showing signs of stabilising. After rising for a third straight day in New York trading on Wednesday, the shares were up about 0.2 percent at 319.5 pence in London on Thursday.

Alex, a Category 2 hurricane when it reached land, unleashed maximum sustained winds near 169km/h, uprooting trees and toppling flimsy houses. It hit the coast of Tamaulipas state in northeastern Mexico, about 160km south of Brownsville, Texas, the US National Hurricane Centre said.

In Washington, the Senate Environment and Public Works Committee voted on Wednesday to eliminate limits on liability that oil companies would face for oil spill damages.

The measure, which would apply retroactively to the BP spill, must be passed by the full Senate and the House of Representatives before going to President Barack Obama to sign into law. Oil companies currently have a $75-million cap for compensating local communities for economic losses and cleaning up environmental damage.

BP already has agreed to set up an independently administered fund of $20-billion to compensate victims.

The Interior Department said on Wednesday it was postponing until later this year planned public hearings on a proposal from Obama - made before the BP spill began - to expand offshore oil drilling. - Reuters

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