As Disaster Worsens, BP Says It Will Pay Oil Spill Cleanup Costs

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Louisiana Oil Rig Explosion

VENICE, Louisiana — BP PLC said Monday that it will pay for all the cleanup costs from a massive oil spill in the Gulf of Mexico that could continue spewing crude for at least another week.Meanwhile, chief executive Tony Hayward said Monday that chemical dispersants have worked to some degree to keep oil from flowing to the surface, though he did not elaborate. He said on ABC television that the new approach seemed to be having a significant impact.

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The company posted a fact sheet on its Web site saying it took responsibility for the response to the Deepwater Horizon spill and would pay compensation for legitimate claims for property damage, personal injury and commercial losses.

RELATED: Oil Spill May Endanger Obama Administration’s Drilling Plans

“We are responsible, not for the accident, but we are responsible for the oil and for dealing with it and cleaning the situation up,” Hayward said. He said the equipment that failed on the rig and led to the spill belonged to owner Transocean Ltd., not BP, which operated the rig.

The update on the dispersants came as BP was preparing a system never tried nearly a mile under water to siphon away the geyser of crude from a blown-out well a mile under Gulf of Mexico waters, off the southeastern U.S. coastline. However, the plan to lower 74-ton, concrete-and-metal boxes being built to capture the oil and siphon it to a barge waiting at the surface will need at least another six to eight days to get it in place.

If the boxes don’t work, BP also has begun work on its only other backup plan: two relief wells that will take as long as three months to drill.

The U.S. Coast Guard and BP have said it’s nearly impossible to know exactly how much oil has gushed since the blast, though it has been roughly estimated to be at least 200,000 gallons (757,000 liters) a day.

At that rate, it would eclipse the 1989 Exxon Valdez tanker spill — which dumped 11 million gallons (42 million liters) off the Alaska coast — as the worst U.S. oil disaster in history in a matter of weeks.

Everything engineers have tried so far has failed. After the April 20 oil rig explosion, which killed 11 people, the flow of oil should have been stopped by a blowout preventer, but the mechanism failed. Efforts to remotely activate it continue to prove fruitless. On the surface, windy weather and waves have hampered plans to burn the oil and made booms all along the coast ineffective.

RELATED: White House: No New Offshore Drilling Until After Explosion Probe

Crews continued to lay boom in what increasingly feels like a futile effort to slow down the spill, with all ideas to contain the flow failing so far.

“It’s not a spill, it’s a flow,” Florida Governor Charlie Crist said at a fundraiser for his U.S. Senate campaign Sunday night. “Envision sort of an underground volcano of oil and it keeps spewing over 200,000 gallons every single day, if not more.”

Fishermen from the mouth of the Mississippi River to northwestern Florida got the news that more than 6,800 square miles (17,600 square kilometers) of federal fishing areas were closed, fracturing their livelihood for at least 10 days and likely more just as the prime spring season was kicking in. The slick also was precariously close to a key shipping lane that feeds goods and materials to the interior of the U.S. by the Mississippi River.

Even if the well is shut off in a week, fishermen and wildlife officials wonder how long it will take for the Gulf to recover. Some compare it to Hurricane Katrina, which Louisiana is still recovering from after nearly five years.

“My kids will be talking about the effect of this when they’re my age,” said 41-year-old Venice charter boat captain Bob Kenney.

At BP’s Houston offices, dozens of engineers and technicians were cloistered on the third floor, working 12-hour shifts round-the-clock to come up with a solution.

“It’s probably easier to fly in space than do some of this,” Charlie Holt, BP’s drilling and completion operations manager in the Gulf of Mexico, said Sunday.

Besides the immediate impact on Gulf industries, shipping along the Mississippi River could soon be limited. Ships carrying food, oil, rubber and much more come through the Southwest Pass to enter the vital waterway.

Shipment delays — either because oil-splattered ships need to be cleaned off at sea before docking or because water lanes are shut down for a time — would raise the cost of transporting those goods.

“We saw that during Hurricane Katrina for a period of time — we saw some prices go up for food and other goods because they couldn’t move some fruit down the shipping channels and it got spoiled,” PFGBest analyst Phil Flynn said.

The Port of New Orleans said projections suggest the pass will be clear through Tuesday.

President Barack Obama toured the region Sunday, deflecting criticism that his administration was too slow to respond and did too little to stave off the catastrophe.

A piece of plywood along a Louisiana highway had these words painted on it: “OBAMA SEND HELP!!!!”

Obama has halted any new offshore drilling projects unless rigs have new safeguards to prevent another disaster. On Sunday he called the spill a “massive and potentially unprecedented environmental disaster,” and made clear that he was not accepting blame.

“BP is responsible for this leak. BP will be paying the bill,” he said.

Even if the oil stays mostly offshore, the consequences could be dire for sea turtles, dolphins and other deepwater marine life — and microscopic plankton and tiny creatures that are a staple of larger animals’ diets.

Moby Solangi, director of the Institute for Marine Mammal Studies in Gulfport, Mississippi, said at least 20 dead sea turtles were found on the state’s beaches. He said it’s too soon to say whether oil contamination killed them but that it is unusual to have them turning up across such a wide stretch of coast, nearly 30 miles.

None of the turtles have oil on them, but Solangi said they could have ingested oily fish or breathed in oil on the surface.

The situation could become even more grave if the oil gets into the Gulf Stream and flows to the beaches of Florida — and potentially whips around the state’s southern tip and up the Eastern Seaboard. Tourist-magnet beaches and countless wildlife could be ruined.

Crist has declared a state of emergency for six counties in Florida. Louisiana also has declared an emergency.

The containment boxes being built were not part of BP’s original response plan. The approach has been used previously only for spills in relatively shallow water. Coast Guard Adm. Thad Allen said engineers are still examining whether the valves and other systems that feed oil to a ship on the surface can withstand the extra pressures of the deep.

BP has not said how much oil is beneath the seabed the Deepwater Horizon rig was tapping when it exploded. A company official, speaking on condition of anonymity because he was not authorized to discuss the volume of reserves, confirmed reports that it was tens of millions of barrels. Fryar said any numbers being thrown out are just estimates at best.

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