Oil slick expected to hit U.S. coast reserve Thursday
HOUSTON (Reuters) - A massive oil slick from a blown-out well in the Gulf of Mexico is expected to reach a Louisiana wildlife reserve on Thursday as it threatens an environmental disaster across four southern U.S. states.
The rig accident, which has pounded the share prices of energy giant BP Plc and other companies involved in the project, may also have ramifications for proposals in Congress and by President Barack Obama to issue new offshore drilling permits.
Obama said London-based BP was ultimately responsible for the cost of the cleanup but that his government would "use every single available resource" -- including the military -- to address the spill.
Louisiana, still recovering from the ravages of Hurricane Katrina in 2005, declared a state of emergency as the growing slick appeared to be coming ashore much sooner than predicted.
"We are expecting to see the first impact at Pass-a-Loutre (Wildlife Management Area) today, Chandeleur Islands on Saturday," said Louisiana Governor Bobby Jindal.
The Coast Guard said the edge of the slick was just 3 miles (5 km) from the Pass-a-Loutre reserve, a maze of waterways, marsh and sandbanks on the edge of the Mississippi Delta.
Earlier at a briefing in Washington, Coast Guard Rear Admiral Sally Brice-O'Hare had predicted the leading edge of the slick would make landfall in the Mississippi Delta "sometime" on Friday.
The leak, after a rig leased by BP exploded last week, is spewing five times more oil than previously estimated and raising fears of severe damage to fisheries, wildlife refuges and beaches in Louisiana, Mississippi, Alabama and Florida.
"This is a spill of national significance," Janet Napolitano, the secretary of Homeland Security, told a news conference at the White House. "We will continue to push BP to engage in the strongest response possible."
Bill Nelson, a Democratic senator from Florida, said he was filing a bill to temporarily prohibit the administration from expanding offshore drilling, citing the risk of a potential "environmental and economic disaster" from the spill.
SHIPPING AND DRILLING
Shares in BP and Swiss-based rig company Transocean Ltd fell by more than 6 percent on Thursday as investors feared a significantly higher cleanup cost. BP is down more than 10 percent and Transocean is down nearly 14 percent since the rig explosion on April 20.
Oilfield services companies Cameron International Corp and Halliburton Co saw their shares tumble on fears about their ties to the Deepwater Horizon rig.
Cameron, which supplied the blowout preventer for the rig, said on Thursday it was insured for $500 million (326 million pounds) of liability, if needed. Halliburton said it did a variety of work on the rig and was assisting with the investigation.
Shrimp fishermen in Louisiana filed a class-action lawsuit against BP, Transocean, Halliburton and Cameron late on Wednesday, accusing them of negligence. None of the companies had an immediate comment on the lawsuit.
The White House said Obama has been briefed on how the slick may interfere with shipping channels, which it said could affect tankers delivering petroleum to the U.S. market.
It was not immediately clear to what extent shipping in the Gulf could be affected. While the Mississippi is a major export route for U.S. grains and the region is a significant importer of crude oil, there were no reports of disruptions.
The Louisiana Offshore Oil Port, which handles more than 1 million barrels a day of crude imports and is connected by pipeline to the biggest U.S. refining region, said it did not expect any effect on its operations, which remained normal.
But there are signs the spill will be worse than one in 1969 off Santa Barbara, California, that prompted a moratorium on oil and gas drilling off the Pacific and Atlantic coasts -- a ban Obama has said he wants to modify.
The Obama administration did not rule out imposing a pause in new deepwater drilling until oil companies can show they can control any spills that may happen.
"Everything is on the table," Deputy Interior Secretary David Hayes told reporters before Senator Nelson announced his legislation, adding it could take 90 days to install a relief valve to stop the leak.
STRUGGLE TO CONTAIN SLICK
Eleven workers are missing and presumed dead after the rig disaster, the worst in the United States in almost a decade.
Transocean's Deepwater Horizon rig sank on April 22, two days after it exploded and caught fire while the company was finishing a well for BP about 40 miles (64 km) southeast of the mouth of the Mississippi River.
The daily leak from the well blowout is now estimated at 5,000 barrels or about 210,000 gallons (795,000 litres).
The Navy said it was supplying the Coast Guard with inflatable booms and seven skimming systems.
BP and the Coast Guard have mounted what the company calls the largest oil spill containment operation in history, involving dozens of ships and aircraft. But they are struggling to control the slick from the leaking well 5,000 feet (1,525 metres) under the sea off Louisiana's coast.
After underwater robots failed to activate a cutoff valve to stop the leak, BP and the Coast Guard set a "controlled burn" on Wednesday to try to prevent the slick from growing.
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