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BP oil spill: daily Gulf costs spiral to $37m

By Emma Thelwell

Updated on 07 June 2010

BP says its new cap collected 11,000 barrels of oil on Sunday as Channel 4 News reveals the cost of mopping up after the Gulf of Mexico spill has spiralled to $37m a day.

US officials have warned that BP's clean-up operation of the Gulf of Mexico will continue for months to come, as Channel 4 News reveals the cost of mopping up has spiralled to $37m a day (Image: Getty)

BP had fitted a cap onto the ruptured pipe on Friday. It said Sunday's total was up slightly on Saturday.

The company said it planned to increase the amount of captured oil to 20,000 barrels.

However, US Coast Guard Admiral Thad Allen said even after the spillage is contained, the clean-up will last well into the Autumn months.

"This is a siege across the entire Gulf. This spill is holding everybody hostage, not only economically but physically. And it has to be attacked on all fronts," he added.

However he told a news conference that the cap effort was going "fairly well".

BP said today that costs of the clean-up have now soared to $1.25bn (£870m) - a rise of $260m (£180m) in the last week alone, or $37m (£25m) a day.

Chief executive Tony Hayward said on Twitter: "Our top priority is the Gulf. I will not be diverted way from that. We will spend what it takes to make it right."

This does not include the $360m in funds earmarked for the Louisiana barrier islands construction project, BP confirmed today.

Oil spill 
Estimates of the daily leakage ranges between 12,000 and 19,000 barrels of oil - with some experts putting the upper range at 25,000 barrels or higher.

Meanwhile, "BP still does not appear to know precisely how much oil is actually escaping, which is discouraging," Democrat Edward J Markey, Massachusetts, said in a letter to BP on Sunday.

Adm Allen said the leak will not be fully contained until the relief wells finally stop the oil flow from the base of the 18,000 foot-deep well.

Work on the first relief well, which started on 2 May, has so far reached a depth of almost 13,000 feet, BP said today, while work on the second relief well has reached around 8,500 feet.

Both are expected to be completed after three months, in August.

"But even after that, there will be oil out there for months to come. This will be well into the fall," Adm Allen said.

More than 2,600 vessels, including tug boats, barges and skimmers, are now involved in the relief effort. Overall, BP has scooped around 368,000 barrels - 15.5m gallons - of oily liquid from the sea.

BP is planning to implement a second containment cap later this week, in addition to the one fitted on Friday.

Hayward 'most hated man'
According to reports in The Daily Telegraph, the scale of the clean-up could impact US relations, after suggestions from some US politicians that BP may be barred from future government contracts.

The oil giant's contracts with the US military are reportedly worth $2bn a year.

Meanwhile, the group's chief executive Tony Hayward was branded "the most hated and clueless man in America", by the New York Daily News over the weekend.

BP's embattled boss has faced growing criticism over his handling of the clean-up, which was exacerbated after he said in an interview: "There's nobody who wants this over more than I do. I want my life back."

Mr Hayward has since apologised on social networking site Facebook.

"I made a hurtful and thoughtless comment," he said. "When I read that recently, I was appalled. I apologise, especially to the families of the 11 men who lost their lives."

However, Mr Hayward has rejected calls to stand down as CEO. "It would be ridiculous to resign at this point," he told reporters at the weekend.

Adm Allen is due to meet with the US President later today to brief the cabinet on the latest in the clean-up.

Last week, the US launched a criminal investigation into whether the oil giant broke any laws in its handling of the spill.

Clean-up costs
Coastal workers in Louisiana said some of the best fishing in the whole region was being ruined. "The oil's coming in - just wave after wave," he said. "It's hard to stomach, it really is."

Mounting criticism of BP's handling of the crisis in the US has given way to a "furious" President Obama, who said on Saturday: "These folks work hard, they meet their responsibilities.

"But now, because of man made catastrophe, one that is not their fault and is beyond their control, their lives have been thrown into turmoil. It's brutally unfair, and it's wrong." 

The company estimates that it will spend about $84m covering loss of income claims for June. "We hope these payments will assist individuals, businesses and the communities impacted," Doug Suttles, chief operating office for BP Exploration and Production, said last week. 

To date, around 37,000 claims have been submitted, with more than 18,000 payments made - costing BP $48m.

BP's total cost to date of $1.25bn includes the cost of the spill response, containment, relief well drilling, grants to the Gulf states, claims paid and federal costs.

Share price
Shares in BP have plunged 31 per cent since the April 20 - when the Deepwater Horizon rig explosion killed 11 workers and triggered the oil spill in the Gulf of Mexico.

However, other companies involved in the disaster have also fallen victim to the markets. Transocean, the offshore drilling group which owns and operates the Deepwater rig, has seen 43 per cent wiped off the value of its shares.

Meanwhile, Halliburton - the sub-contractor in charge of securing the well, has suffered a 27 per cent fall in its shareprice.

Shares in Anadarko, an independent US oil and gas group with a 25 per cent stake in the Deepwater project, is nursing losses of 39 per cent.

The sector has also been rocked by the US government's move to halt deepwater drilling activities in the Gulf of Mexico after the spill.

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