BP Caps Well, but Faces Gusher of Criticism Over Claims

BP (BP) successfully placed a new containment cap over the damaged Deepwater Horizon well in the Gulf of Mexico Monday night, and over the next 48 hours will run tests to determine if the cap can successfully stem the flow of oil.

The company began running safety checks Tuesday morning to make sure dangerous pressure that could cause leaks in other parts of the damaged well will not build as valves on the new cap are slowly closed. Analysts have warned that shutting off the gushing oil too quickly could cause an explosion.

National Incident Commander Admiral Thad Allen said the tests "will provide valuable information about the condition of the well below the sea level and help determine whether or not it is possible to shut the well for a period of time, such as during a hurricane or bad weather, between now and when the relief wells are complete." The testing will last between six and 48 hours initially, but could go on longer if necessary. Since this sealing cap system has never been used on a deepwater well before, BP said total containment of the oil could not be assured.

BP also said that the collection of oil from the well by the Discoverer Enterprise and Q4000 vessels would have to stop during the testing, meaning the roughly 25,000 barrels of oil a day they've been capturing would be released into the Gulf. However, once the testing is complete, a third oil-collection system connected to the Helix Producer will be added to the effort, which could then collect anywhere from 35,000 to 60,000 barrels of oil a day. A fourth collection system could increase oil capture to 60,000 to 80,000 barrels a day.

Relief Wells on Schedule but Claim Payments Way Behind

Meanwhile, the company reported that work on the two relief wells that are seen as the main option for completely closing the damaged well remains on schedule. Over the weekend, the lead driller rig for the relief wells came within a few hundred feet of the point where it will try to re-bore into the well so that it can be cemented closed. The target date for completion of the first relief well is mid-August.

Unfortunately, relief for local businesses affected by the spill cannot come fast enough as criticism of BP's claims process intensified on Monday. The company said it had received as many as 105,000 claims, but half of them had not been processed. In a statement, the company said it had made more than 52,000 payments to residents totaling almost $165 million. Gulf residents accuse BP of requiring extremely detailed paperwork and seizing on any small omission to deny claims. The company maintains that it has cut down the time it takes to approve claims.
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