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US lawmakers summon top oil firm bosses

Commercial fisher-woman Diane Wilson of Seadrift, Texas, pours a jar of syrup made to look like oil over herself as a U.S. Captiol Police officer drags her from a Senate Energy and Natural Resources Committee hearing about the BP Deepwater Horizon oil spill June 9, 2010 in Washington, DC. Interior Secretary Ken Salazar testified before the committee about the Obama Administration's increased safety regulations of energy exploration on the Outer Continental Shelf in the wake of the ongoing BP Deepwater Horizon oil spill in the Gulf of Mexico. Photo courtesy AFP.

Salazar says offshore drilling to continue in 'safe' manner
Washington (AFP) June 9, 2010 - US Interior Secretary Ken Salazar told lawmakers Wednesday that offshore drilling in the Gulf of Mexico will continue "in a safe way" in the wake of the massive Deepwater Horizon accident. Salazar told the Senate Energy and Natural Resources Committee that a range of new regulations implemented following the accident at the BP-operated well would protect against new spills. "Offshore drilling will continue... it has to be done in a safe way," he told the panel.

Salazar, who heads the agency that oversees oil leasing and management of federal lands, highlighted tougher safety rules imposed this week for offshore drilling and the reorganization of the Minerals Management Service, the division which has been criticized for being too cozy with the oil industry. But he said the rules would not halt all offshore drilling despite the six-month moratorium on new deepwater wells ordered by President Barack Obama last month. "The importance of the jobs is very much on the mind of the president and on my mind as well," Salazar said. He told Senator Mary Landrieu of Louisiana that the administration would ask BP to pay salaries of oil sector workers whose jobs have been suspended by the drilling ban.

According to committee figures, the Gulf of Mexico has some 3,600 wells or drilling operations and 700 of them are at depths of around 1,500 meters (5,000 feet) like the Deepwater Horizon. The start of the hearing was interrupted by a woman carrying a jar of black liquid which she poured over her head. The woman was removed from the hearing by Capitol police. Salazar confirmed that BP was capturing around 15,000 barrels a day from a new device placed on the wellhead, but was unable to estimate how much was still leaking. "It is important for us to have the right number. We'll get that right number," he said. "Our goal is get zero pollution from this well. Nothing is being spared to bring this problem under control."
by Staff Writers
Washington (AFP) June 9, 2010
A key US House committee said Wednesday it had invited top executives from major oil companies to face drilling safety questions amid deep public anger at the catastrophic Gulf of Mexico spill.

The House Energy and Environment Subcommittee sent letters to the heads of ExxonMobil, Chevron, ConocoPhillips, BP America and Shell oil calling on them to appear at a June 15 hearing, the panel said in a statement.

The panel, one of several investigating the disaster, will wait to hear back from all of the executives before it announces a formal witness list, according to an aide.

Democratic House Majority Leader Steny Hoyer told reporters that oil firms hoping to do business in US waters should attend the session, entitled "Drilling Down on America's Energy Future: Safety, Security, and Clean Energy."

"Every oil company in the world, certainly every oil company that's doing business anywhere in the United States, has a direct interest in this issue. they have a direct interest in this spill being stopped," he said.

"To that extent, although BP may be a competitor of Exxon or other companies, my view is that every company ought to have a very high incentive to give us their best advice and counsel" on how to "stop this from happening again," said Hoyer.

He also ramped up criticisms of BP and Transocean, which ran the Deepwater Horizon rig until an April 20th explosion that sank the platform and left an uncapped well gushing hundreds of thousands of barrels of oil, fouling Gulf waters.

"There is reason to believe that there was a lot of negligence present, here, and that corners were cut that should not have been cut," said Hoyer, who cited "improper activity" by firms tied to the operation.

He mentioned what he described as misleading assurances from BP that the firm had a plan to contain a giant spill, and scolded the firm for underestimating the amount of oil flooding into the Gulf.

"This is a crisis of mammoth proportions," said Hoyer. "There's going to be an end to it, but we don't yet know the scope of the consequences."

earlier related report
US sets deadline for BP as mistrust grows
New Orleans, Louisiana (AFP) June 9, 2010 - The US tightened pressure Wednesday on BP, setting a 72-hour deadline for the battered British energy titan to present updated plans for battling the Gulf of Mexico oil spill.

Coast Guard Admiral Thad Allen, charged with leading the government response to the disaster, ordered BP to produce records of compensation claims filed by individuals and businesses in the four stricken southern US states.

The stringent demands betrayed the growing mistrust between BP and President Barack Obama's administration more than seven weeks into the nation's worst ever environmental catastrophe.

Fueled by 24/7 media coverage of oiled birds and tides of toxic crude washing up on US shores, the American public's anger is growing and Obama's administration is under increasing pressure to hold BP accountable.

Allen was to meet later Wednesday to discuss compensation with executives from the company, which has been accused of intentionally underestimating the scale of the disaster in order to reduce its liability.

Beforehand, he sent a letter to BP CEO Tony Hayward asking him to explain how compensation packages to devastated local industries were being calculated and how quickly claims were being processed.

"They own the data, we need the data. I asked for that in the letter and now we'll move forward to correct any problems we might find," Allen said.

A separate letter ordered BP to produce contingency planning for its "top hat" containment system and say how it intends to recover an undetermined amount of crude and natural gas still leaking.

"BP shall provide the plans for these parallel, continuous, and contingency collection processes, including an implementation timeline, within 72 hours of receiving this letter," said the missive, dated Tuesday.

A device placed last week over the blown out well, located 50 miles (80 kilometers) off the coast of the southern US state of Louisiana, is capturing almost 15,000 barrels, or 630,000 gallons, of oil a day.

It remains unclear how much crude and natural gas is still spewing out, but Allen said he hoped that modifications next week "could take leakage almost down to zero."

He told a press briefing he had ordered a special "flow rate task group" to work up new estimates on how much oil is gushing from the wellhead.

"We'll just continue to refine the estimates. I'm not going to declare victory on anything until I have the numbers," he said. "Show me the numbers."

Facing a grilling from Senate lawmakers on Wednesday, Interior Secretary Ken Salazar admitted that cutting the leaking riser pipe to construct the system could have increased the flow rate by between four and five percent.

The hearing was disrupted as a protester poured an oily-looking liquid on herself before being arrested.

"This is what it feels like to have oil dumped on you," shouted the woman, who later issued an angry statement saying she was a fourth generation shrimper from the Gulf.

Amid the growing public frustration, Obama lashed out Tuesday at media "talking heads" who have criticized his response and said if it was up to him, he would fire Hayward over a series of flippant public remarks.

Hayward will testify before US lawmakers for the first time next week, as investors fear intense political pressure from Washington over the spill could force the group to axe its prized shareholder dividend.

BP's market value has plunged by billions of dollars since the Deepwater Horizon oil rig, operated by BP and owned by US contractor Transocean, sank on April 22 -- two days after a huge explosion killed 11 workers.

Shares have collapsed around 40 percent since the accident.

"There remains an intense amount of uncertainty over future dividend payments to shareholders, with senior politicians in the US applying strong pressure to delay any payment until legal and clean up costs have been covered," City Index analyst Joshua Raymond told AFP.

"Moreover, with President Barack Obama's public outburst at BP -- ie to kick ass -- and the fact that there are important congressional elections ahead in November, there is a fear that BP could be used as a scapegoat to garner political support."

Obama heads to the Gulf of Mexico next week for his fourth visit since the disaster.

BP is meanwhile plowing on with the drilling of two relief wells that should be ready by August to enable the company to permanently plug the leak.



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