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BP may re-tap reservoir, citing "lots of oil"

11:52 AM, Aug 6, 2010   |    comments
In this July 28, 2010 satellite image provided by NASA, oil from the Deepwater Horizon oil spill is visible on the surface of the Gulf of Mexico.
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BP PLC said Friday it might someday drill again in the same undersea pocket of oil that gushed millions of gallons of its crude into the sea, crushing livelihoods and fouling beaches and wildlife habitat along hundreds of miles of Gulf of Mexico shoreline.

"There's lots of oil and gas here," Chief Operating Officer Doug Suttles said at a news briefing. "We're going to have to think about what to do with that at some point."

The vast oil reservoir beneath the blown well is still believed to hold nearly $4 billion worth of crude. With the company and its partners facing tens of billions of dollars in liabilities, the incentive to exploit the wells and the reservoir could grow.

Retired Coast Guard Adm. Thad Allen, the government's point man on the spill, said he had no information on BP's future plans.

"I would assume that's a policy issue related to the management of the lease," he told reporters. "Frankly, it hasn't been raised to my level at this point. I'm not sure I can comment on it."

Suttles has spent more than three months managing BP's response efforts on the Gulf but is now returning to his day job in Houston, the company said. Mike Utsler, a vice president who has been running BP's command post in Houma, La., since April, will replace him.

The personnel shift comes as BP appears to be gaining the upper hand on plugging the leak, triggered when an oil rig exploded off Louisiana on April 20, killing 11 workers and triggering the massive spill.

Engineers this week poured in cement to complete a plug at the top of the wellbore as part of a process dubbed a "static kill," but they needed to wait at least a day for it to harden. Once it does, crews can finish the last stretch of a relief well intersecting the blown well just above the oil's source, injecting more mud and cement from the bottom to form a final plug.

Suttles confirmed Friday that crews for now plan to use the 18,000-foot relief well to seal off with mud and cement the underground reservoir feeding the blown well.

The company had been hedging on how exactly it would use the relief well, which it has been digging for three months, as federal officials insisted it should be used to perform the so-called "bottom kill."

Crews have already plugged up the well from the top with mud and cement. But federal officials want BP to plug it from the bottom to make sure it's permanently sealed.

Suttles says crews are preparing to drill the final 100 feet of the primary relief well.

If not used for the bottom kill, the relief wells could have conceivably offered a way for BP or another company to pump oil from the reservoir and sell it, an idea unlikely to sit well with Gulf Coast residents and families of workers who died on the rig.

Linda Kaye Randolph, 54, a real estate investor who grew up on the coast in Pass Christian, Miss., said Thursday it disturbs her that anyone might use the site commercially.

"People died out there on that rig," she said, her voice cracking. "It isn't about the money. It would bother me that they're not respecting the people who died there. There's thousands of other wells. They can find another place. Leave that one alone."

BP has not been approached by any other company about buying the relief wells, spokesman Scott Dean said.

But with the company and its partners facing tens of billions of dollars in liabilities, the incentive to exploit the wells and the reservoir could grow.

Outgoing BP Chief Executive Tony Hayward said in June that the reservoir feeding the busted well was believed to hold about 2.1 billion gallons of oil. Roughly 200 million gallons have leaked out, leaving about 1.9 billion gallons, or about 45,238,000 barrels. At the current market price per barrel - $82 - that would make the reservoir still worth $3.7 billion.

BP still has access to a roughly 3-by-3-mile block of sea floor that could contain multiple reservoirs, "so there is a lot more potential" for oil production, said George Hirasaki, a Rice University professor in chemical and biomolecular engineering an expert on oil containment.

The static kill started Tuesday with engineers pumping enough mud down the top of the well to push the crude back to its underground source. Suttles said engineers plan to monitor the cement newly pumped in from the top and hope to test the plug with a burst of pressure Friday afternoon to make sure it's sealed.

"All the indications so far look very encouraging," he said.

A federal report this week indicated that only about a quarter of the spilled crude remains in the Gulf and is degrading quickly.

"There's essentially no skimmable oil left on the surface, no recoverable oil left on the surface," Suttles said.

Some scientists disputed the report's veracity, and much of the remaining crude has permeated deep into marshes and wetlands, complicating cleanup.

As BP pulled brought in 33-year employee Utsler to take over the response and the blown well appeared to have flatlined, some Gulf residents who still see the oil wreaking havoc worry the nation's attention is shifting.

"I'm losing trust in the whole system," said Willie Davis, a 41-year-old harbormaster in Pass Christian, Miss. "If they don't get up off their behinds and do something now, it's gonna be years before we're back whole again."

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