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MN: Oil spill cleanup costs top $3B
 
NEW ORLEANS, Louisiana — Efforts to clean up the Gulf of Mexico oil spill gathered steam on Monday after Hurricane Alex prompted a five-day shutdown, amid new questions over how BP would pay for the mounting costs.

Cleanup workers arrived back on Grand Isle, Louisiana by the hundreds, spilling off school buses that shuttled them in from around the state.

In the wake of Hurricane Alex, beaches, shorelines and marshes lay smeared with thick patches of oil and the sky was still filled with ominous, gray clouds.

“This is definitely the most oil I’ve seen. So far,” said one worker who declined to give his name.

Skimming operations resumed in Louisiana but rough seas kept vessels tied up in harbor in three other southeastern US states and no controlled burns were being carried out.

But officials said other operations to fend off the spill, including laying protective boom, were back on track.

Skimming was suspended last week as Tropical Storm Alex, which later became the first Atlantic hurricane of the 2010 season, entered the Gulf.

Following the storm, tar balls and tar patties were reported on the beaches in Waveland and Bay Saint Louis, Mississippi. Approximately 20 tar balls were also found on West Belle Fontaine beach in the same state.

BP revealed on Monday that its costs arising from the devastating oil spill have rocketed to US$3.12-billion dollars.

As it faces a massive bill, the company is turning to rival oil groups and sovereign wealth funds to fend off a possible hostile takeover bid, reports said.

The National, an Emirati newspaper based in Abu Dhabi, reported that sovereign wealth funds in the oil-rich Middle East have proposed making a strategic investment in BP, which has pledged to place US$20-billion in an escrow account to pay for the cleanup in the Gulf.

The firms were also allegedly mulling buying key assets from BP and financially backing any capital the oil company might plan to raise after the British energy giant lost over half of its stock market value and saw its shares plunge in the wake of the disaster.

Britain’s Sunday Times meanwhile said BP was seeking a strategic investor to buy a five- to 10-percent stake in the embattled firm with a pricetag of up to US$9.1-billion dollars.

BP now hopes the giant Taiwanese supertanker “A Whale” can exponentially boost the amount of oil and water mix being scooped up from the surface of the gulf.

The tanker should be able to vacuum up 21 million gallons of oily water a day, separate it and spit the seawater back out.

Only 28.2 million gallons have been collected by smaller skimming boats over the past 10 weeks since the April 20 explosion that ripped through the BP-leased Deepwater Horizon rig triggered the worst environmental disaster in US history.

Tests on the 275-metres tanker-turned-skimmer were expected to be completed by Monday before officials decide whether to deploy it.

Seventy-five days into the spill, the oil has fouled some 715 kilometres of shoreline in four southeastern U.S. states, killed wildlife and put a big dent in the region’s multi-billion-dollar fishing industry.

The National Oceanic and Atmospheric Administration meanwhile expanded the area closed to fishing in the Gulf beyond the current northwestern boundary off Louisiana, bringing to the closure to 210,258 square kilometres.

That represents about 33.5% of the Gulf’s federal waters.

The spill has endangered livelihoods throughout the region and even put a damper on Independence Day celebrations Sunday.

In Grand Isle, American flags were flying, but instead of a day on the beach and fishing rodeos, families were filling inflatable swimming pools just yards from shuttered seafood restaurants.

“I haven’t stepped on the beach in weeks now,” said Amy Lafourt, a bartender at Artie’s, a beachfront bar and music club.

Kenneth Feinberg, the administrator of BP’s escrow fund told Fox News Sunday he would try to “maximize” payouts.

“You have to look at each and every case,” said Mr. Feinberg, a prominent lawyer who also oversaw a fund for victims of the September 11, 2001 attacks.

“I’m working for the people in the Gulf. I want to try and maximize as much compensation as I can do fairly and consistently to the people I’m trying to serve down there.”

Estimates suggest between 35,000 and 60,000 barrels of oil per day are gushing into the sea. An operation to permanently cap the ruptured well on the seafloor far below the surface cannot begin until engineers finish drilling relief wells, in mid-August at the earliest.

But despite its role in the oil spill, BP remained a key supplier of fuel to the Pentagon, The Washington Post reported late Sunday.

Citing data from the Defense Logistics Agency, the newspaper said BP had contracts with the US Defense Department worth at least US$980-million in the current fiscal year.

In fiscal 2009, BP was the Pentagon’s largest single supplier of fuel, providing 11.7% of the total purchased, and in 2010, its contracts amount to roughly the same percentage, the report said.



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