Shares of BP Plc gained today after it announced progress in containing its Gulf of Mexico oil leak but the energy giant still faced tough questions from investors and US lawmakers as the spill threatened more of the US Gulf coast.
Spilled oil is now looming off white sand tourist beaches in northwest Florida, depositing tar balls and debris on some, after soiling stretches of coast in Louisiana, Mississippi and Alabama in the worst US environmental disaster.
During the weekend, BP announced advances in controlling the undersea leak through a containment cap over the blown-out wellhead, giving estimates of captured oil that suggest a significant portion of the escaping crude is being collected.
But a live video feed of the seabed leak still shows black crude billowing out 1.6km down in the Gulf of Mexico, and BP and government officials have said a definitive solution will only come in August when a relief well is drilled. This will intersect the leaking well and allow it to be sealed.
BP shares have lost about one-third of their value since the crisis began but in London today they were up more than 2 per cent. The rise came on the news of progress in the operation of the lower marine riser package (LMRP) containment cap put in place late last week.
Despite the more encouraging news, US president Barack Obama still faces criticism that he has not taken a forceful enough leadership role in tackling America's worst oil spill, which was in its 49th day today.
BP, which said it had so far spent about $1.25 billion on the response effort, says an additional system to capture more of the leaking oil using equipment previously developed for a failed "top kill" attempt to plug the well could allow the company to siphon off the vast majority of the leaking oil.
This system could be operating in mid-June, a spokeswoman said.
BP, whose shares have lost about one-third of their value since the crisis began, has vowed to pay all legitimate damages claims of those harmed by the disaster.
BP said its containment cap had captured 16,600 barrels of oil (2.64 million litres) between June 3rd and June 6th and it expects an increase in volumes of both oil and gas collected in the next several days.
On June 5th, a total of 10,500 barrels of oil was collected by the cap. US government estimates put the well's leak at 12,000 to 19,000 barrels a day, but some independent scientists have said they believe it is much higher. Maximum collection capacity of the existing containment cap is 15,000 bpd.
The weekend progress came as the company's chief executive, Tony Hayward, insisted he had no plans of quitting over his handling of the environmental disaster, marked by a string of failures since the April 20th rig explosion that triggered the oil spill.
The vast extent of the environmental impact of the spill is only gradually becoming apparent.
This week also will feature three hearings by various committees of the US Congress - two in Louisiana, today and Wednesday, and one in Washington on Thursday - where BP's handling of the crisis will come under scrutiny.
The Obama administration has delayed plans to increase offshore drilling as a result of the spill. The crisis has put Mr Obama on the defensive and distracted his team from the domestic agenda - a new energy policy, reform of Wall Street and bolstering a struggling US economy.
Mr Obama wants to tap into public anger over images of polluted beaches and fishing grounds to press for faster development of alternative energy.
Oil began leaking from the well after the rig exploded, killing 11 workers. BP faces a criminal investigation, lawsuits, dwindling investor confidence and questions about its credit-worthiness.
Reuters