BP appears to have finally brought the Deepwater Horizon oil well leak to a permanent halt, with the well being cemented closed. However, the disaster has cost the company dearly in lives, environmental damage, compensation and now it's CEO.
After completing cementing operations on well MC252, which exploded more than four months ago, BP believes it has finally put the lid on the company's - and one of the US's - most costly oil spills. The company stated that since July 15, when a second cap was placed over the damaged well, no new oil has flowed into the Gulf of Mexico. Now, a cement plug, combined with continued relief well drilling which is just a few feet away from entering the well, will ensure the leak is permanently sealed.
The Deepwater Horizon explosion and subsequent leak has been one of the largest ever clean-up operations involving the oil industry, local and national agencies and communities. More than 47,000 people and 7,000 vessels plus aircraft and millions of feet of absorbent boom have been employed in helping to clean up the Gulf waters and coastline. Reports indicate that the majority of the oil has dispersed and evaporated or has been burned, skimmed or recovered directly from the leaking wellhead.
BP's Operation's chief, Doug Suttles, said the focus remains on the response effort rather than the future of the well, before he relinquished his on-the-ground duties to return to his COO role at BP's Houston HQ. The future of CEO, Tony Hayward, was also clarified with BP announcing that Hayward will be stepping down in October after 30 years with the company, making way Bob Dudley - a 54 year-old, US-born main board director.
Hayward will receive a £1m ($1.56m) payoff, plus a lifetime pension of about half that sum annually. BP Chairman, Carl-Henric Svanberg, said the board was "deeply saddened to lose a CEO whose success over some three years in driving the performance of the company was so widely and deservedly admired." He also claimed that "BP remains a strong business...But it will be a different company going forward, requiring fresh leadership supported by robust governance and a very engaged board."
In his own statement, Hayward added: "The Gulf of Mexico explosion was a terrible tragedy for which – as the man in charge of BP when it happened – I will always feel a deep responsibility, regardless of where blame is ultimately found to lie....I believe the decision I have reached with the board to step down is consistent with the responsibility BP has shown throughout these terrible events."
The response to the spill has already cost BP around $6.1bn and the company is set to pay the financial cost for some considerable time yet. The company has so far paid out in excess of $300m in claims to more than 40,000 businesses and individuals affected by the spill. In addition, a $3bn initial deposit has been paid into the promised $20m BP Escrow Trust which will continue to pay for clean up operations and legal claims. A further $2bn will be paid in Q4 of 2010 and $1.25bn deposited quarterly until the final figure is reached.