Dome suspended over US oil leak

BP engineers using undersea robots had a massive metal chamber hovering just above a ruptured oil well in the Gulf of Mexico …

BP engineers using undersea robots had a massive metal chamber hovering just above a ruptured oil well in the Gulf of Mexico today in a mission seen as the best chance yet to contain the damaging spill.

The 98-ton structure has been lowered to the seabed almost 1.6km below the surface. The mission requires pinpoint accuracy in the dark and under high water pressure.

The container was suspended just over the leak while crews using remotely operated vehicles prepared the seabed, said the Unified Command Centre, which is coordinating spill-fighting efforts.

"It will hover there until they are ready. They hope to lower to sea floor today, but they need to finish prepping the surface," the Centre said in an update last night.

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BP, which faces major financial losses from the spill, suffered a further blow yesterday when ratings agency Standard & Poor's lowered its outlook on the oil giant to negative from stable.

It is under pressure from the Obama administration to limit the damage. BP has said it will pay all legitimate costs, a bill that is likely to run into billions of dollars.

BP officials hope to attach a pipe to the big metal box to start siphoning oil to a ship next week.

The device has not been tried at that depth, where engineers guiding remotely operated vehicles battle darkness, currents and intense undersea pressure. BP chief executive Tony Hayward warned there was no certainty of success.

BP is drilling a relief well to halt the leak - which began after the Deepwater Horizon rig exploded on April 20th, killing 11 crew members - but it could take up to three months to complete.

They gave up on efforts to close valves on a failed blow-out preventer with nderwater robots, after trying in vain for two weeks, said Doug Suttles, BP's chief operating officer.

Surface containment efforts continue, helped by calm seas. Crews conducted controlled burns for a second straight day.

Forecasts suggest light winds today, although they are expected to shift and come from the south to southwest, which could push the slick towards the Louisiana shore.

About 270 boats deployed protective booms and used dispersants to break up the thick oil yesterday. Crews have laid almost 240km of boom, and spread one million litres of chemical dispersant.

The spill threatens an economic and ecological disaster on tourist beaches, wildlife refuges and fishing grounds in Louisiana, Mississippi, Alabama and Florida. It has forced President Barack Obama to rethink plans to open more waters to drilling.

An estimated 5,000 barrels (795,000 litres) have poured into the Gulf each day since the well ruptured.

But Ian MacDonald, a biological oceanographer at Florida State University, said the estimate was much too conservative.

The real flow rate from the undersea well, based on aerial images of the oil slick and estimates of the thickness of the oil itself, is probably closer to 25,000 barrels (4 million litres) per day, Mr MacDonald said. .

A sheen of oil has engulfed much of the Chandeleur Islands, barrier islands that are part of Louisiana's Breton National Wildlife Refuge, the first confirmation of the oil slick hitting land. Some oiled birds have been found in recent days.

The Breton refuge was closed to the public after a silver sheen and emulsified oil reached the shoreline, the US Fish & Wildlife Service said. Altogether, crude from the spill could hit 24 national wildlife refuges.

US authorities yesterday modified and expanded the boundaries of the area closed to fishing as a result of the spill, and extended restrictions for another 10 days, to May 17th. The closed area represents almost 4.5 percent of Gulf of Mexico federal waters, up from slightly less than 3 percent included in the original ban.

Standard & Poor's, in announcing the negative outlook, indicated a ratings downgrade was likely. Moody's said the spill raised the spectre of credit pressure for the five primary companies involved in the project.

S&P cut its outlook for Anadarko Petroleum Corp, which has a 25 per cent stake in the ill-fated well, to stable from positive, saying it is "potentially liable for significant costs and liabilities relating to the clean-up”.

Other companies involved are Transocean, owner of the rig; Cameron International, which supplied the failed blow-out preventer for the well; and Halliburton, which helped cement in place the blown-out well.

Hayward said a $75 million legal cap on its cleanup and compensation liabilities under federal law, which some US lawmakers now want to raise, would not be a limit for BP.

BP shares dropped 2.3 per cent in London yesterday. In New York, BP's American Depository Receipts fell 2.7 per cent.

Reuters