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BP p.l.c. Message Board

  • dock_by_the_bay dock_by_the_bay May 3, 2010 3:24 PM Flag

    CNBC "Worst is over"

    Facts are fun:

    NEW YORK (TheStreet) -- Jim Cramer, on his Monday Stop Trading! segment on CNBC, said that the game for BP(BP) changed at around 2 p.m. Monday when the New York Times reported the company was making major progress with building domes to contain the leaking oil in the Gulf of Mexico oil spill.
    Cramer noted that BP will be the major company "on the hook," of all of those that have come under the microscope since the tragic Gulf of Mexico oil spill, and that BP would be responsible for all the costs. Still, those who believe that BP could be wiped out by this catastrophic event are wrong, Cramer said: "BP's debt-to-capital is incredible."

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      worst is not over by a long shot. -got to love the media,trying to bs the public. we were just out ther today .they have not even began the process only ideas. who wants to dive 5k ft in oil and not be able to see and to use the torch could lite them on fire so its harder than you can imagine

    • Facts are fun part four.

      "Under the Oil Spill Liabilty Trust Fund" the off-shore rig operators face no more than $75 Million in liabilty damages claimed by individuals or government."

      GOOGLE IT, savor it and then take a shower you pathetic shorts!


    • Keep drinking Cramer's KoolAid my friend and you'll end up at the bottom of the ocean like BP's rig. This thing is far from over even if they stop the leak, there is a massive spill to clean up and economic imacts yet to be computed not to mention mounting litigation. The only play with BP right now is a massive Short.

    • BP is a wicked evil company.No backup plan.No solution for capping the well. No safety plan. Disaster!

    • Didn't Cramer say that Transocean was responsible last week??? Why is no one mentionning the other parties involved??

    • Facts are fun: part three.

      BP's insurance to cushion impact of oil spill-Fitch
      NEW YORK, April 30 (Reuters) - Containment and cleanup costs of a massive oil spill in the Gulf of Mexico could top $3 billion, but financial impacts on BP Plc will be limited by the oil company's insurance, Fitch Ratings said on Friday.

      An oil drilling rig on lease to London-based BP (BP.L) (BP.N) exploded in flames on April 20 and collapsed two days later, leading to a massive oil spill that threatened to become the worst U.S. ecological disaster ever.

      The spreading oil has deepened fears of severe damage to fisheries, wildlife refuges and tourism in Louisiana, Mississippi, Alabama and Florida. Shrimp fishermen in Louisiana have filed a class action lawsuit against BP, accusing it of negligence.

      "The ultimate financial impact on BP will depend on how the environmental and economic impact develops when the spill reaches land," Fitch said in a statement.

      Costs could be more than $3 billion, depending on how long it takes to arrest the flow of oil into the Gulf, Jeffrey Woodruff, senior director in Fitch's energy team in London, said in the statement.

      Insurance will likely cover the majority of BP's costs, limiting rating pressure, Fitch said. It now rates BP AA-plus, just one notch below its top rating of AAA.

      There are precedents for $%^&sing the potential impacts, Fitch said. In the 1989 Exxon Valdez spill, when about 250,000 barrels of crude oil were spilled into Prince William Sound, Alaska, cleanup costs were an estimated $2 billion, Fitch said. Exxon was eventually found liable for actual damages of about $287 million and compensatory damages of about $500 million after a series of appeals spanning nearly 20 years, Fitch said.

      Exxon was originally $%^&sed punitive damages of $5 billion but a US Supreme Court ruling in 2003 imposed limits on punitive damages, helping reduce Exxon's liability, Fitch said.

      Assuming the BP oil spill is worse than the Exxon Valdez accident, as environmentalists are now claiming, and it takes an additional 60 to 90 days to drill a relief well and stop the leak, the total spill could be about 1 million barrels, Fitch said.

      Fitch said it will take rating action if necessary because of significant increases in BP's estimated environmental or litigation costs. (Reporting by Dena Aubin; Editing by Theodore d'Afflisio)

    • Facts are fun part two: Repost.
      The Deepwater Horizon, a state-of-the-art, dynamically positioned floating semi-submersible drilling platform that costs BP $502,000 a day to run, was close to finishing drilling a series of exploratory wells in 5000 feet of water and was about to be moved. A report obtained from a drilling industry analyst who asked to remain anonymous due to a pending investigation, shows that the rig workers had recently set and cemented a casing and were in the process of displacing the riser (a pipe that encloses the drill string from the platform to the sea bottom) with seawater and setting a surface plug when the well blew out.

      The report reads, "the incident appears as if it was either the product of gas migration through the cement sheath as it was setting or that the act of displacing the riser to seawater reduced the hydrostatic head enough that it caused the well to start flowing though cement that was not yet hard. With casing in the ground, these two possible explanations seem by far the most likely, although its impossible at this point not to rule out some other cause or contributing factor such as a blowout preventer or a casing integrity issue."

      "Blowouts happen four to five times a years," says Bill Markus, vice president of response at the legendary Texas firm of Boots & Coots, "down from 11 to 15 in 2000." Boots & Coots is not working on the Deepwater incident and Markus cautions that he has no specific knowledge of what happened or if it was even a blowout.

      The work BP is doing in the Gulf of Mexico is part of a flurry of drilling in what's known as deep and ultra-deep water—from 5000 to 10,000 feet of water, and up to another 30,000 feet underground—which is riskier and far more complex than drilling in shallow water or on land. The deeper the well, the higher the temperature and pressure of the fluids or gas, and as those fluids rise, they expand ever faster. In what's known as high-pressure, high-temperature drilling, even small gas bubbles become enormous as they travel toward the surface. "That's the inherent danger of drilling deeper," says Markus. "You have small gas influxes all the time, but in ultra deep they become radical."

      In addition, the farther offshore, the more complex every piece of the logistical puzzle becomes, especially when an unexpected tragedy strikes. Fires on any drilling rig are rare, but when they happen, especially offshore, they can be very dangerous.

      No oil company wants to have a blowout and these companies spend vast sums of money and expertise to ensure that they never happen. But happen they do, and Markus says that while most insurance companies always attribute them to human error, in reality no two are the same. "If this was a blowout," he says, "it's the first deep-water one in the Gulf of Mexico that I can think of. And for that to happen requires the perfect storm of scenarios."

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