BP's costs soar as storm delays oil containment

NEW ORLEANS, Louisiana, Jun 29 (AFP) – BP's costs soared as a major storm stymied efforts to double the amount of oil captured from a ruptured well deep in the Gulf of Mexico.

Tropical storm Alex, the first major storm of the Atlantic hurricane season, appeared set to sidestep the massive slick, but its strong winds made seas too rough to attach a third vessel to siphon oil from a containment cap some 5,000 feet (1,500 meters) below the surface.

AFP/Getty Images/File – Pete Duchock holds his daughter, Maddie Duchock, as they stand near oil residue

Rough seas could also push the oil deeper into fragile coastal wetlands and has already shifted parts of the slick closer to sensitive areas in Florida and Louisiana, said US Coast Guard Admiral Thad Allen, who is overseeing the response efforts.

"Any kind of a surge or a storm would obviously exacerbate the oil further into marshes, which would cause problems, and we're going to face that potential throughout the hurricane season," he told reporters.

Even the threat of gale force winds -- upward of 45 miles (72 kilometers) per hour -- will suffice to force drilling and containment ships to withdraw from the spill site some 52 miles (83 km) off the coast of Louisiana, Allen said.

Evacuations must begin 120 hours in advance, and operations will be shut down for about two weeks to "take down the equipment, move it off to a safe place, bring it back and reestablish drilling," Allen said.

That would delay the completion of relief wells designed to permanently plug the well until September, and would drastically increase the flow of oil still gushing into the sea some 70 days after the deadly explosion on the BP-leased Deepwater Horizon drilling rig.

The current containment system is capturing nearly 25,000 of the estimated 30,000 to 60,000 barrels of crude gushing out of the ruptured well every day.

The now-delayed Helix Producer vessel was set to increase containment capacity to 40,000 to 50,000 barrels per day by early July.

Former US president Bill Clinton said blowing up the well "may become necessary" and expressed concern about the ultimate success of the two relief wells currently being drilled.

"This is a geological monster," Clinton told CNN.

"You could stop that well, but what else might you do that might upset the ecostructure of the Gulf?"

But BP vice president Kent Wells said the energy giant has a "high degree of confidence in the relief wells."

The first well, which stretches over 16,700 feet (5,090 meters), is now only 20 horizontal feet (six meters) away from the original well, Wells told reporters.

Engineers will drill parallel to the original well for about another 1,000 feet (305 meters) before trying to cut into it and cap it with heavy drilling fluids known as mud and concrete.

"I'm really confident in the team's chance of being successful here," Wells said.

BP earlier raised its costs over the oil spill to 2.65 billion dollars, an increase of about 300 million dollars over the weekend that means the energy firm is now forking out about four million dollars an hour.

The firm was also forced to deny reports its chief executive Tony Hayward was set to resign after weeks of taking flak for a string of gaffes and insensitive remarks about the disaster.

Meanwhile, Tropical Storm Alex gained strength as it moved into the southwestern Gulf after dumping heavy rains across the Yucatan peninsula, having killed at least 10 people in Nicaragua, Guatemala and El Salvador.

On its current path, Alex is projected to make landfall in Mexico late Wednesday, with most of its force avoiding the oil spill area in the northeastern Gulf off the Louisiana coast.

Alex, which already packed maximum sustained winds of 65 miles (100 km) an hour, was "gradually strengthening," and is expected to become a hurricane on Tuesday, the Miami-based National Hurricane Center said.

OPEC urged the United States to reconsider legal moves and ditch a ban on deepwater drilling slapped on the oil industry in the wake of the Gulf of Mexico oil spill disaster.

Vice President Joe Biden heads to the region on Tuesday and is due to visit the New Orleans command center before traveling to the Florida panhandle.

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