The British energy giant is expected to get a far cooler reception in New Orleans than it would have received if the cases had been assigned to a judge in Big Oil's headquarters of Houston, Texas, as BP had sought.

A judicial panel said New Orleans was the most appropriate place because Louisiana is the "geographic and psychological center of gravity" for the litigation.

Some 77 civil cases already filed in the affected Gulf states of Louisiana, Texas, Mississippi, Alabama and Florida were be consolidated and will be handled by a single judge, Carl Barbier.

The decision could also affect more than 200 other spill-related cases considered as "tag-along actions," the ruling said, adding that there could be more in the pipeline.

Meanwhile, final operations to kill BP's catastrophic Gulf of Mexico oil well were suspended until at least Sunday due to an impending storm, US spill chief Thad Allen said Tuesday.

The National Hurricane Center said Tropical Depression Five could become a tropical storm by Wednesday and was already packing sustained winds of 35 miles (55 kilometers) per hour.

The Miami-based center said a tropical storm warning was in effect for the Gulf Coast region from Florida to Louisiana, amid forecasts of up to 10 inches of rain in some places, and a storm surge as high as four feet.

There is no danger of the storm reopening the plugged well, which caused the largest maritime oil spill of all time, but Allen said he had decided to suspend the drilling of the crucial relief well as a precaution.

After drilling 17,909 feet (5,426 meters) below sea level, the first relief well is about 30 feet from intercepting the stricken Macondo well, although the last bit is by far the trickiest and most time-consuming part.

"We don't necessarily expect gale force winds but we expect the weather to be choppy enough out there," said Allen. "Terminating the drilling operations and holding still where they're at was the best thing to do until the front passed through."

BP performed a static kill operation last week that suppressed the gushing oil with mud and cemented in the main drill pipe.

But there is still concern that the area between the pipe and the outer well bore, known as the annulus, could contain oil.

Once the relief well intercepts the Macondo well, scientists can check before finally sealing the bottom of the annulus with cement.

The well ruptured when the BP-leased Deepwater Horizon rig sank on April 22, two days after a massive explosion that killed 11 workers.

Some 4.1 million barrels of oil spewed into the gulf before BP could fully cap the ruptured well 5,000 feet (1,500 meters) below the surface and 50 miles (80 kilometers) off the coast of Louisiana.

Hundreds of miles of fragile coastal wetlands and once-pristine beaches stretching from Texas to Florida were sullied and the region's multi-billion dollar fishing and tourism industries were crippled.

As operations continued in the Gulf of Mexico, the US government was reportedly closing in on a deal with BP to see its verbal commitment to fill up a 20-billion-dollar disaster fund become a legal obligation.

BP deposited on Monday a first installment of three billion dollars into a special bank account that will compensate thousands of Gulf residents and businesses hit by the largest maritime oil spill of all time.

But The Wall Street Journal reported that US President Barack Obama's administration was still holding discussions with the energy giant on how it intends to guarantee it will pay the remaining 17 billion dollars.

BP has said it plans to pay an additional two billion dollars into the fund in the fourth quarter, followed by further deposits of 1.25 billion each quarter after that until an original pledge of 20 billion dollars is met.

The Obama administration is apparently concerned that BP might not live up to its word, especially if it runs into further financial or legal trouble, and is seeking to use BP's future revenues as collateral.

BP is the operator of 89 producing wells in the Gulf of Mexico and a stakeholder in 60 others and the report said it is considering using the revenue from some 400,000 barrels of oil a day from these as collateral.

earlier related report
BP deposits 3 billion dollars into Gulf disaster fund
Washington (AFP) Aug 9, 2010 - BP made its first deposit into the Gulf of Mexico oil disaster fund on Monday, while top executives were summoned to the White House to pledge their long-term commitment to restoring the region.

BP deposited an initial chunk of three billion dollars into a special bank account that will compensate thousands of residents and businesses hit by the largest maritime oil spill of all time.

"The purpose of the escrow account was to assure those adversely affected by the spill that we indeed intend to stand behind our commitment to them and to the American taxpayers," BP's incoming CEO Bob Dudley said in a statement.

"Establishing this trust and making the initial deposit ahead of schedule further demonstrates our commitment to making it right in the Gulf Coast."

BP plans to pay an additional two billion dollars into the fund in the fourth quarter, followed by further deposits of 1.25 billion each quarter after that until an original pledge of 20 billion dollars is met.

US President Barack Obama has appointed prominent lawyer Kenneth Feinberg, who managed compensation claims by victims of the September 11, 2001 terror attacks, to oversee the fund.

With BP's relief well poised to intercept the blown-out Macondo well and the final "bottom kill" operation just days away, Obama said Monday that the battle against the undersea gusher "is just about over."

"Yesterday we learned that the procedure to prevent any more oil from spilling with a cement plug appears to have succeeded," he said.

"The final steps will be taken later in August when those relief wells are completed, but what is clear is that the battle to stop the oil from flowing into the Gulf is just about over."

But Obama, who served Gulf seafood at a White House event Sunday to help boost confidence in the region's billion-dollar fishing industry, stressed that the long-term effort to restore the region was just beginning.

"The work goes on," he said during a White House ceremony Monday to honor the New Orleans Saints, the reigning Superbowl champions.

"I've made the commitment to the people of the Gulf Coast that I would stand by, not just until the well is closed, but until they recover from the damage that's been done. And that's a commitment that my administration is going to keep."

Dudley and Lamar McKay, another top BP executive, were called Monday to the White House to meet with senior administration officials including Obama's chief of staff Rahm Emanuel and spill pointman Thad Allen.

"They impressed upon BP the importance of living up to their commitment to long term recovery, and underscored that the administration will remain vigilant in ensuring that promise is met," a White House statement said.

Allen said earlier that after drilling some 17,909 feet (5,426 meters) below sea level in the Gulf of Mexico, the relief well was now only 30 to 40 feet from intercepting the well.

"We expect that sometime toward the end of the week we'll be in a position to intercept the annulus and commence the kill," Allen said, referring to the area between the well pipe and the outer bore of the well.

Once the interception occurs, engineers will pump in heavy drilling fluid known as "mud" and then cement to provide a permanent seal over the oil reservoir miles beneath the sea floor.

BP performed a static kill operation last week that suppressed the gushing oil with mud and put a basic cement plug over the top of it.

The well ruptured when the BP-leased Deepwater Horizon rig sank on April 22, two days after a massive explosion that killed 11 workers.

BP has spent 6.1 billion dollars in response to the spill, it said on Monday, but that amount is set to spiral.

An estimated 4.9 million barrels of oil, more than 205 million gallons, spewed from the well in the 87 days from the beginning of the disaster until the leak was finally capped on July 15.

About 800,000 barrels were captured by containment operations that siphoned oil from the gushing wellhead to ships on the surface.

Under the law, fines could be as much as 4,300 dollars per barrel spilled, if negligence is proven. This means BP could theoretically face fines of up to 17.6 billion dollars for the 4.1 million barrels that poured into the sea.

Thousands of people in the Gulf region's vital fishing, tourism and oil industries are also expected to seek compensation for loss of income, either directly from BP's fund or through the courts.

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