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BP said it was gaining confidence in the cap over the ruptured Gulf of Mexico oil well, as plans took shape Wednesday to seal the blown-out well for good.

The British energy giant and US government officials were evaluating the cap each day, and on Tuesday extended for another 24 hours the period of evaluation of the so-called capping stack structure that appeared to stop the oil flow last week after nearly three months.

"We're just going to continue on with the tests. And every day that we continue on with the tests, that gives us more confidence when we don't see any anomalies," BP vice president Kent Wells told a briefing Tuesday.

Wells said teams are moving closer to completing a relief well that would seal off the leak and at the same time discussing the possibility of a "static kill," that would inject materials to seal off the flow sooner.

"The relief well is exactly where we want it, pointed in the right direction. So we're feeling good about that," Wells said

"The intercept of the Macondo well is still for the end of July and then the kill procedure, dependent upon whether we have flow up the annulus casing or both, could take anywhere from a number of days to a few weeks."

US Coast Guard admiral Thad Allen, who is overseeing the disaster response, said the planning was still in initial stages, and stressed two relief wells being drilled close to the broken wellhead remain the ultimate fix.

He has ordered BP to produce a detailed timeline for restarting operations to contain the oil with surface vessels if there is any major leakage from the wellhead and the cap has to be re-opened.

The announcement on Thursday that BP had stopped the oil flow completely for the first time since April raised hope among devastated Gulf communities that a three-month nightmare may soon be over.

The comments came as BP announced it was selling assets in the United States, Canada and Egypt worth a total of seven billion dollars to US energy firm Apache to help pay for the disaster.

"Over the last two months the board has considered BP's options for generating the cash necessary to meet the obligations likely to arise from the Gulf of Mexico oil spill," said BP chairman Carl-Henric Svanberg.

"The board believes that there are opportunities to divest assets which are strategically more valuable to other parties than they are to BP. Today's announcement is the first such transaction and meets the value and strategic criteria of both parties."

Also Tuesday, British Prime Minister David Cameron sought to ease anger in the US over the spill.

"The oil spill in the Gulf of Mexico is a catastrophe, for the environment, for the fishing industry, for tourism. I've been absolutely clear about that," Cameron said after White House summit talks with US President Barack Obama.

The British leader stressed BP bore the responsibility for the clean-up with hundreds of miles of Gulf coastline contaminated and thousands of lives wrecked by the damage done to the fishing and tourism industries.

"Equally, of course, BP is an important company to both the British and the American economies. Thousands of jobs on both sides of the Atlantic depend on it," Cameron said.

"So it's in the interest of both our countries, as we agreed, that it remains a strong and stable company for the future."

BP has already spent close to four billion dollars on clean-up costs and compensation claims and has promised to set up a 20-billion-dollar fund to pay victims of the disaster along the US Gulf Coast.

The fate of the company is a sensitive issue, since BP's stock is the backbone of many British pension funds.

But the US Department of Labor warned Tuesday that the oil disaster could cost as many as 100,000 jobs across the US Gulf Coast if it cannot be resolved and Obama's moratorium on deepwater drilling is extended until the end of the year.

The disaster began on April 20 when the Deepwater Horizon drilling platform exploded in the Gulf of Mexico, 50 miles (80 kilometers) off the coast of Louisiana, killing 11 workers.

The rig sank two days later rupturing the pipe that connected it to the well. Oil has since washed up on the coasts of all five Gulf states -- Texas, Louisiana, Mississippi, Alabama and Florida.

It is not known exactly how much oil has leaked into the sea, but if the upper estimate of over four million barrels is confirmed, the disaster would be the biggest accidental oil spill ever.

Story by Alex Ogle from AFP
AFP 07/21/2010 08:22

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