After pumping mud into the blown well at the site of the Deepwater Horizon oil rig to perform a successful static kill, BP has now added a cement plug for good measure.
This is an unmitigated success for BP. Not so much because they have apparently managed to seal the well for good (though additional cement may also be poured in from the bottom, through the relief well that is nearing completion), but because they managed to do so without ever letting the flow of oil from the blown well be metered.
That has been a key BP objective from the beginning. Robert L. Cavnar spelled it out in the Huffington Post on July 8, in a post titled “BP’s Incentive: To Not Capture All the Oil“.
While they have every incentive to get the well killed, BP also has every incentive to not capture 100% of the well flow until they do. As soon as they do capture all the flow, then a real, measurable number will be in front of the public, and that’s the last thing BP wants, since that number will then be used to extrapolate environmental damage, hence per barrel fines that will likely run to the tens of billions anyway.
A precise estimate of the volume of oil leaking from the well is exactly what BP dedicated months of concerted effort to obstruct.
The Washington Post reported on August 2 that the final official government estimate of the total oil spilled is 4.9 million barrels:
The blown-out well in the Gulf of Mexico gushed 12 times faster than the government and BP estimated in the early weeks of the crisis and has spilled a whopping 4.9 million barrels, or 205.8 million gallons, according to a more detailed analysis announced late Monday.
BP’s Macondo well spewed 62,000 barrels of oil a day initially, and as the reservoir gradually depleted itself, the flow eased to 53,000 barrels a day until the well was finally capped and sealed July 15, according to scientists in the Flow Rate Technical Group, supervised by the U.S. Geological Survey and the U.S. Department of Energy.
The federal penalty that BP is eventually asked to pay will be based on this official estimate. Since 800,000 barrels of oil were captured by BP without ever spilling into the Gulf, the fine will be computed on 4.1 million barrels:
If BP is not found to have acted with negligence, the penalty would be $1,100 per barrel. About 4.1 million barrels escaped into the gulf, according to the new estimate, so that fine would come to $4.5 billion. If BP is found to have acted with “gross negligence” in the lead-up to the spill, the maximum penalty would be $4,300 a barrel, which would work out to $17.6 billion.
The Flow Rate Technical Group’s 4.9 million barrel estimate was reported just before the static kill was initiated. At that point, BP could still have allowed 100% of the oil spilling from the well to be collected, yielding a precise measurement of how much oil was actually spilling now. This, in turn, would have led to a more accurate measurement of the total oil that was spilled.
The fact that BP didn’t do this clearly suggests that the company is confident that the FRTG numbers represent an underestimate, that BP has managed to get away with something here.
BP had, quite brilliantly, engineered a situation where, if the spill rate on which the penalty was to be based came in too low, they could just embrace that estimate by plugging the well without ever permitting a precise spill rate measurement, whereas if it came in too high, they could graciously permit it to be corrected.
At worst, they couldn’t lose. At best, they might win. And it looks like they did indeed win.