USA > History > 2010 > Environment (IV)

It Adds Up:

This Was New York’s

Hottest Summer

August 31, 2010
The New York Times
By PATRICK McGEEHAN

With one final, fitting blast of 96-degree heat on Tuesday, the summer of 2010 went down in the National Weather Service’s record books as the hottest ever in New York City.

Hotter than the previous high of 77.3 degrees set in 1966, when more than 1,100 deaths were attributed to heat that repeatedly exceeded 100 degrees. Hotter than 2006, when a heat wave set off a blackout in northern Queens that left more than 100,000 residents without power for days.

But in this record-breaking season — defined by the Weather Service as June through August — there was no cataclysm, no singular event that was likely to define a three-month period when the temperature averaged 77.8 degrees. Instead, the summer of 2010 might be more properly measured in more subtle ways.

For Sal Medina, a newsstand operator from the Bronx, it could be measured by the number of frozen water bottles that he slipped into his pants this week to stay cool (three).

For John Natuzzi, it could be all the ice cubes used during the first day of the United States Open tennis tournament on Monday (80,000 pounds).

For lifeguards, it could be the number of total visitors to the city’s beaches (17.2 million).

For executives at Consolidated Edison, it would surely be the number of 90-degree days the utility struggled through without any widespread disruptions of its power network (34).

Tally it all up and the sum of the last three months is a rarely interrupted stretch of hot days that forced New Yorkers to keep cool in ways both traditional and creative.

Mr. Medina, 56, who lives in Pelham Bay, could barely stand to be inside his metal-jacketed newsstand at Clinton and Delancey Streets on the Lower East Side of Manhattan. To cool off, he devised a system using frozen pint-sized bottles of Poland Spring water.

He would tuck three inside the waistband of his pants. A fourth he would sling in a plastic bag whose handles he would knot just under his chin, holding the icy cylinder against the back of his neck.

Even with that gear, Mr. Medina said he had quit early a few days this summer, heading home at 3 p.m. on the hottest days, instead of the usual 6. The heat, he said, “affects your whole nervous system, makes you grouchy; it makes you so you can’t stand your customers.”

At Natuzzi Brothers Ice Company in Queens, the phones ring nonstop once the temperature hits 90, Mr. Natuzzi said. This summer, he said, his company has been supplying dry ice to ice-cream stores to keep their products frozen, a request he said he rarely got last summer.

The shortage of orders during the cool early months of last summer led to significant losses, Mr. Natuzzi said, but this summer has been a different story. The company, whose warehouse holds 40 tons of ice, sold out its supply during the heat wave that started on the July 4 weekend. It has been running its delivery trucks up to 15 hours a day since then.

“It’s been quite a ride this summer,” Mr. Natuzzi said.

Exhausted as he is, it is not quite over. His company supplies ice to the food-service operations at the United States Open, which runs for two weeks. On the first day, the Open used about 20,000 pounds more than usual, he said. “I’ll look back and say that this is one summer I’ll never forget,” Mr. Natuzzi said.

At Con Edison, the summer of 2010 will be memorable for what did and did not happen. In the past three months, the utility’s customers drew more power off its grid than during any previous three-month period, according to data compiled by the company. But through successive heat waves, the electric distribution system held up, with only occasional localized disruptions.

“For two days we suffered,” said Theo Trilivas, 65, a retired plumber who lost power in his home in Astoria, Queens, in July. “No power. No cooking. No A.C. No lights. Nothing. We had to throw out everything in the freezer.”

The growing demand for power from residential customers has been one of the bigger surprises to Con Ed officials this summer. Of the company’s 36 distribution networks, 14 — all in residential areas — exceeded the forecast for peak demand, said John F. Miksad, a senior vice president who oversees the company’s electric operations. Reflecting the weak state of the economy, power usage by commercial customers declined this summer, he said.

The increased use of air-conditioning has been one constant of life in the metropolitan region. According to Con Ed’s estimates, 6.6 million air-conditioners are in use in its service area, and that number is rising by at least 170,000 a year.

Sam Sharma and his wife tried placing buckets of ice cubes on window sills and in front of fans in their apartment on the second floor of a house in Woodside, Queens. But eventually they broke down and did what so many other New Yorkers have done: they bought an air-conditioner.

“We have it in the living room and only run it when it is extreme heat, and then only for a few hours,” said Mr. Sharma, an immigrant from Nepal who works as a parking lot attendant. “Maybe we used it 10 days this whole summer. It’s expensive.”

In search of relief, some people actually sought out the city. On Monday, Sharon Fredman, 38, a Web consultant from Tenafly, N.J., had run out of suburban options to entertain her daughter, Margot, 8, and keep her cool at the same time. So she drove in for the day to let Margot splash around in a sprinkler in Tompkins Square Park. “When it’s 90 degrees,” Ms. Fredman said, “it’s equally hot everywhere.”

When New Yorkers sought to escape the heat indoors, they flocked to the beaches, particularly Coney Island. According to the city’s parks department, total attendance at Coney Island’s beach slightly exceeded 12.8 million people, more than triple the total from 2009.

“There were tremendous increases at all the beaches,” said Adrian Benepe, the parks commissioner. “The beaches were our natural air-conditioners.”

Many of those beachgoers were repeat visitors, like Stephen Fybish, who said he went to Coney Island or neighboring Brighton Beach to swim in the ocean 11 times this summer. He said that he found the sand to be crowded some days but that he always had ample room to swim.

A weather historian who has kept detailed records on temperatures in the city for many years, Mr. Fybish was already looking ahead to September and calculating what sort of weather it would take to extend the hottest-ever distinction. By his reckoning, the average temperature for the month has to be higher than 71 degrees for New York to have its hottest June-through-September period on record.


C. J. Hughes and Rebecca White contributed reporting.

It Adds Up: This Was New York’s Hottest Summer, NYT, 31.8.2010, http://www.nytimes.com/2010/09/01/nyregion/01summer.html

Banks Grow Wary of Environmental Risks

August 30, 2010
The New York Times
By TOM ZELLER Jr.

Blasting off mountaintops to reach coal in Appalachia or churning out millions of tons of carbon dioxide to extract oil from sand in Alberta are among environmentalists’ biggest industrial irritants. But they are also legal and lucrative.

For a growing number of banks, however, that does not seem to matter.

After years of legal entanglements arising from environmental messes and increased scrutiny of banks that finance the dirtiest industries, several large commercial lenders are taking a stand on industry practices that they regard as risky to their reputations and bottom lines.

In the most recent example, the banking giant Wells Fargo noted last month what it called “considerable attention and controversy” surrounding mountaintop removal mining, and said that its involvement with companies engaged in it was “limited and declining.”

The bank was a small player in the sector, representing about $78 million in bonds and loan financing for such companies from 2008 to April of this year, according to data compiled by the Rainforest Action Network, an environmental group tracking the issue.

But the policy shift by Wells Fargo follows others over the last two years, including moves by Credit Suisse, Morgan Stanley, JPMorgan Chase, Bank of America and Citibank, to increase scrutiny of lending to companies involved in mountaintop removal — or to end the lending altogether.

HSBC, which is based in London, has curtailed its relationships with some producers of palm oil, which is often linked to deforestation in developing countries. The Dutch lender Rabobank has applied a nine-point checklist of conditions for would-be oil and gas borrowers that includes commitments to improve environmental performance and protect water quality.

In some cases, the changing policies represent an attempt to burnish green credentials in areas where the banks had little interest, and there is no indication that companies engaged in the objectionable practices cannot find financing elsewhere.

Still, banking analysts and others suggest that heated debate over climate change, water quality and other environmental considerations is forcing lenders to take a much harder — and often uncomfortable — look at where they extend credit, and to whom.

“It’s one thing if your potential borrower is dumping cyanide in a river,” said Karina Litvack, the head of governance and sustainable investment with F&C Investments, an investment management firm based in London. “But if they’re dumping carbon dioxide into the air, which is not exactly illegal — what do you do? Banks are in kind of a quandary, because they are competing for business, and if they get holier-than-thou and start to play policeman, they risk allowing other banks to take that business.”

Environmental risk has been on the radar for lenders since the 1980s and early 1990s, when courts began forcing some measure of responsibility on banks for the polluting factories, superfund sites and other environmental problems that had, to one degree or another, been facilitated by their financing.

Congress passed a law in 1996 that limited the exposure of lenders on this front, but since then, most major banks have developed environmental risk management divisions as part of their commercial banking due diligence efforts.

Now, the rise of murkier issues like global warming, along with increasing scrutiny by environmental groups of banks’ investments in many other industries — like oil and gas development, nuclear power, coal-fired electricity generation, oil sands, fuel pipeline construction, dam building, forestry and even certain types of agriculture — are nudging lenders into new territory.

“We’re taking a much closer look at a much broader variety of issues, not all of which are captured under state and local laws,” said Stephanie Rico, a spokeswoman for the environmental affairs group at Wells Fargo.

Ms. Litvack, of F&C Investments, pointed to large protests last week by many climate activists outside the Royal Bank of Scotland in Edinburgh. At least a dozen protesters have been arrested in demonstrations against the bank’s financing of oil sands development in Canada.

The Royal Bank of Canada, meanwhile, responding to intense pressure from environmental advocates denouncing the bank’s financing of oil sands projects, hosted 18 international banks in Toronto in February for “a day of learning” on the “regulatory, social and environmental issues” surrounding the oil sands.

Globally, banks and environmental advocates are seeking to make things easier by developing best practices and other voluntary standards. Citigroup, JPMorgan Chase and Morgan Stanley helped initiate the Carbon Principles, which aim to standardize the assessment of “carbon risks in the financing of electric power projects” in the United States. Several international financial institutions — including HSBC, Munich Re and others — have formed the Climate Principles, which aim to encourage the management of climate change “across the full range of financial products and services,” according to the compact’s Web site.

In the United States, mountaintop removal mining has become both increasingly common and contentious, as coal companies vie to feed the nation’s appetite for inexpensive electricity. An expeditious and disruptive form of surface mining, it involves blasting off the tops of mountains and dumping the debris in valleys and streams below.

A report published in May by the Sierra Club and the Rainforest Action Network estimated that nine banks were the primary lenders for companies engaged in mountaintop removal mining in Appalachia, and that they had provided nearly $4 billion in loans and bond underwriting to those companies — chiefly Massey Energy, Patriot Coal, and Alpha Natural Resources — since 2008.

The Rainforest Action Network, which has headed a campaign to highlight financial institutions with connections to the mining, said this month that the policy shifts were chipping away at the financing.

Citing Bloomberg data, for example, the group noted that Bank of America — listed as recently as 2008 as one of the “syndication agents” on a $175 million revolving line of credit to Massey Energy — has eliminated that and all other connections to the company. The group also pointed to JPMorgan, which had previously underwritten $180 million in debt securities to Massey, but no longer has any financial ties to that company. In May, the bank said it would be subjecting all future engagements with companies involved in mountaintop removal mining to “enhanced review.”

Some environmental groups have criticized that and other policies as providing too much wiggle room — and whether any of it has any real impact is an open question. Mining industry representatives say such policies often fail to consider laws already in place requiring coal companies to limit their environmental impact, and to restore former mine sites when they are finished.

Carol Raulston, a spokeswoman for the National Mining Association, an industry group, said that most of the policies in question position the banks to phase out lending over time — and only to companies that primarily engage in mountaintop removal mining. “Companies are still getting financing for their projects,” she said.

Roger S. Hendriksen, the vice president for investor relations for Massey Energy, suggested that environmentalists were overstating things, and that his company was having no trouble securing financing.

“While some banks no longer provide financing for companies conducting surface mining, there are many who will,” Mr. Hendriksen said. “We have and will continue to replace their services with alternate bank providers with little difficulty.”

But Rebecca Tarbotton, the executive director of the Rainforest Action Network, said in a published statement that the banks’ moves nonetheless send “a clear signal that these companies have a high risk profile and that other banks should beware.”

“Bottom line,” she added, “as access to capital becomes more constrained it will be harder for mining companies to finance the blowing up of America’s mountains.”

    Banks Grow Wary of Environmental Risks, NYT, 30.8.2010, http://www.nytimes.com/2010/08/31/business/energy-environment/31coal.html

Hurricane Danielle Becomes Category 3 Storm

August 27, 2010
Filed at 2:10 a.m. ET
The New York Times
By THE ASSOCIATED PRESS

MIAMI (AP) -- Forecasts say Hurricane Danielle has reached major hurricane status.

National Hurricane Center forecasters said early Friday that Danielle had strengthened to a Category 3 storm. It has maximum sustained winds of 120 mph (195 kph).

Forecasters say swells churned up by Danielle could reach parts of the U.S. East Coast by the weekend and that dangerous surf conditions are expected in Bermuda, though the eye will likely move well east of the island.

Farther east, Tropical Storm Earl is racing west over the Atlantic with winds near 45 mph (75 kph). Forecasters expect Earl to become a hurricane by early Saturday. Another system is following Earl's tract and could become a depression soon.

In the Pacific off Mexico's coast, Hurricane Frank has winds of 85 mph (140 kph).

    Hurricane Danielle Becomes Category 3 Storm, NYT, 27.8.2010, http://www.nytimes.com/aponline/2010/08/27/us/AP-Tropical-Weather.html

Rumor to Fact in Tales of Post-Katrina Violence

August 26, 2010
The New York Times
By TRYMAINE LEE

NEW ORLEANS — In the days after Hurricane Katrina left much of New Orleans in flooded ruins, the city was awash in tales of violence and bloodshed.

The narrative of those early, chaotic days — built largely on rumors and half-baked anecdotes — quickly hardened into a kind of ugly consensus: poor blacks and looters were murdering innocents and terrorizing whoever crossed their path in the dark, unprotected city.

“As you look back on it, at the time it was being reported, it looked like the city was under siege,” said Russel L. Honoré, the retired Army lieutenant general who led military relief efforts after the storm.

Today, a clearer picture is emerging, and it is an equally ugly one, including white vigilante violence, police killings, official cover-ups and a suffering population far more brutalized than many were willing to believe. Several police officers and a white civilian accused of racially motivated violence have recently been indicted in various cases, and more incidents are coming to light as the Justice Department has started several investigations into civil rights violations after the storm.

“The environment that was produced by the storm brought out what was dormant in people here — the anger and the contempt they felt against African-Americans in the community,” said John Penny, a criminologist at Southern University of New Orleans. “We might not ever know how many people were shot, killed, or whose bodies will never be found.”

Broken levees left 80 percent of New Orleans submerged, but in unflooded Algiers Point, for instance, a mostly white enclave in a predominantly black neighborhood on the west bank of the Mississippi River, armed white militias cordoned off many of the streets.

They posted signs that boasted, “We shoot looters.” And the sound of gunfire peppered the hot days and nights like thunderclaps of a second storm.

Reginald Bell, a black resident, said in a recent interview that he was threatened at gunpoint by two white men there a few days after the storm. The men, on a balcony a few blocks from his home, yelled at him, “We don’t want your kind around here!”

Then one of the men racked his pump-action shotgun, aimed it at Mr. Bell and dared him to be seen again on the streets of Algiers Point, Mr. Bell said. The next day, he said, the men confronted him on his porch while he sat with his girlfriend. They shoved guns — a shotgun and a long-nose .357 Magnum — in the couple’s faces and reiterated their demand.

“There was no electricity, no police, no nothing,” said Mr. Bell, 41, sitting on his porch on a recent afternoon. “We were like sitting ducks. I slept with a butcher knife and a hatchet under my pillow.”

The West Bank area of the city was spared any flooding, but in the days and weeks after the storm, it was littered with fallen trees and, according to witnesses, with the bodies of several black men — none of whom appeared to have drowned.

“I done seen bodies lay in the streets for weeks,” said Malik Rahim, who lives around the corner from Mr. Bell and came to his aid. “I’m not talking about the flooded Ninth Ward, I’m talking about dry Algiers. I watched them become bloated and torn apart by dogs. And they all had bullet wounds.

“We’ve been screaming it from the top of our lungs since those first days, but nobody wanted to listen.”

Mr. Bell said that he went to the police not long after the confrontation with the two gun-wielding white men but no report or action was taken. It was not until last year when he was interviewed by a federal grand jury looking into civil rights violations in post-Katrina New Orleans that people seemed to pay attention, he said.

Some of the most serious accusations surfaced after investigations by The Times-Picayune and the nonprofit news organization ProPublica, which spotlighted much of the police violence and racially motivated violence around Algiers Point.

One case is that of a former Algiers resident, Roland J. Bourgeois Jr., who is white and was accused of being part of one of the vigilante groups. He was recently indicted by the federal government on civil rights charges in the shooting of three black men who were trying to leave the city. According to the indictment, Mr. Bourgeois, who now lives in Mississippi, warned one neighbor that “anything coming up this street darker than a brown paper bag is getting shot.”

The highest-profile case involving the police is the Danziger Bridge shooting in eastern New Orleans, where six days after Katrina, a group of police officers wielding assault rifles and automatic weapons fired on a group of unarmed civilians, wounding a family of four and killing two, including a teenager and a mentally disabled man. The man, Ronald Madison, 40, was shot in the back with a shotgun and then stomped and kicked as he lay dying, according to court papers.

Mayor Mitch Landrieu in May invited the Justice Department to conduct a full review of the city’s Police Department. The Justice Department has also begun several civil and criminal investigations into post-Katrina violence involving the police and civilians.

Thomas Perez, an assistant attorney general, said the federal government was investigating eight criminal cases involving accusations of police misconduct. Many people in the city — including activists, victims and witnesses — had long contended that racial violence was being ignored by local law enforcement.

“We were dismissed as kooks for the last four years,” said Jacques Morial, a co-director of the Louisiana Justice Institute, a nonprofit advocacy organization, and the son of New Orleans’ first black mayor. “I think what we are seeing now recalibrates the reality of Katrina, and I think it vindicates lots of folks.”

The city’s police superintendent, Ronal Serpas, who took over the department in May, said he was troubled by what has come to light since the storm.

“We have to confront this and look at it head on,” Mr. Serpas said. “There have been far too many examples of men who have worn this badge and admitted in court to behavior that is an absolute insult to this city and to the men and women of this department who wear this badge with dignity and pride.”

On a recent afternoon, Mr. Rahim, 62, walked through the streets of Algiers and pointed out where, block by block, the militias had set up barricades and stood guard. He walked along the levee where the charred remains of Henry Glover were found in the trunk of a burned-out car, precipitating the indictment of three current and two former police officers.

“How can you remove the scars from the eyes of all the children who witnessed these atrocities?” Mr. Rahim asked.

General Honoré said that he had been asking himself questions, too.

“I think, every year there is more time for people to reflect on it,” he said. “I came out of Katrina with one perspective on it. And there isn’t a month that goes by that I don’t talk to someone who survived it who gives me a different perspective than I had before.”

    Rumor to Fact in Tales of Post-Katrina Violence, NYT, 26.8.2010, http://www.nytimes.com/2010/08/27/us/27racial.html

Behind Scenes of Gulf Oil Spill, Acrimony and Stress

August 26, 2010
The New York Times
By CLIFFORD KRAUSS, HENRY FOUNTAIN and JOHN M. BRODER

This article is by Clifford Krauss, Henry Fountain and John M. Broder.

HOUSTON — Richard Lynch was walking down the hall in BP’s crisis command center in early May when some engineers rushed up, bearing bad news.

“We’ve lost the cofferdam,” they said.

In fact the cofferdam, a 100-ton, four-story-high steel dome that the company had lowered to try to contain the flow of oil from its out-of-control well, had become clogged with icelike crystals and was rising in the water, full of flammable gas and oil.

“I said: ‘What the hell do you mean you’ve lost the cofferdam? How did you lose it? Don’t give me that!’ ” Mr. Lynch, a BP vice president and a leader of the effort to kill the well, recalled. “This thing has taken off like a damn balloon.”

Had the dome hit one of the work ships, another inferno like the one that destroyed the Deepwater Horizon drilling rig might have resulted, with more lives lost. But eventually the engineers managed to maneuver it to safety.

“The last thing you’d want is this thing filled with ice rushing up to the bottom of the vessel,” Mr. Lynch said.

The official death of the now-notorious Macondo well in the Gulf of Mexico is expected after Labor Day, with the completion of a relief well. Whether the four-month effort to kill it was a remarkable feat of engineering performed under near-impossible circumstances or a stumbling exercise in trial and error that took longer than it should have will be debated for some time.

But interviews with BP engineers and technicians, contractors and Obama administration officials who, with the eyes of the world upon them, worked to stop the flow of oil, suggest that the process was also far more stressful, hair-raising and acrimonious than the public was aware of.

There were close calls, the details of which were not released to the public, like the panic over the rising dome. Sleep-deprived men and women neglected family birthdays and watched long-planned summer vacations vanish. Inside the command center here and at the well site, 40 miles off the coast of Louisiana, tempers flared — in one heated argument, a senior engineer on a ship threatened to throw another senior engineer overboard — and blood pressures rose.

The dome was only the first public debacle. As failure followed failure, the relationship between BP executives and administration officials deteriorated, resulting in disputes that some oil industry experts say delayed the killing of the well.

Looking back, administration officials said that they became concerned that BP could not handle the crisis and that at crucial junctures the company made serious errors of judgment. “There was an arc of loss of confidence,” said Interior Secretary Ken Salazar. “I was not comfortable they knew what they were doing.”

Those on the industry side saw it differently. “The only benefit I see is they actually challenged us to a level of detail and communication,” Mark Mazzella, BP’s top well-control expert, said of the government scientists who stepped in to supervise the effort. “They didn’t offer anything that changed anything we actually did.”

A decision by Energy Secretary Steven Chu to turn to BP’s competitors for advice was viewed as an insult by many at the company, said a technician who insisted on anonymity because he was not authorized to speak about the matter.

The tensions above filtered down to the command center — a series of rooms on the third floor of a tower on BP’s campus in Houston’s Westlake section — where the seasoned well experts faced a challenge of unparalleled scale and difficulty: to apply techniques used often on land to an out-of-control well 5,000 feet underwater.

“If ever there was a ‘war,’ this would qualify,” one contractor wrote in a letter to BP.

The walls of the center were papered with notes from well-wishers: “You are heroes, may God lead, direct and protect you all,” read a poster sent by BP workers in South Africa. BP offered the scores of exhausted workers services including massages, “stress therapy” and information on sleep hygiene and ergonomic techniques to reduce physical strain.

But by mid-August, when the oil was finally contained, the well was cemented and all that remained was the completion of the relief well, the intensity of the experience was becoming clear to many of those who worked to stop the worst marine oil spill in American history.

“It’s been one of those sort of very profound periods in your life,” said Paul Tooms, BP’s vice president for engineering. “I’m not quite sure what normal is going to feel like after this.”

Mounting Frustrations

Mr. Mazzella, the BP well-control expert, who ropes and rides at rodeos in his spare time, was at a practice rodeo in early June when the wife of a friend confronted him.

“You’re not doing a very good job, are you?” she said.

Even Mr. Mazzella’s elderly father pointedly asked him one day when BP would finally get the well plugged.

“We are tired of hearing about it on the TV,” he told his son.

Mr. Mazzella said he and his colleagues struggled to shrug off the criticism and stay focused on their task. But the humiliation peaked over Memorial Day weekend, when the procedure called the top kill also met with failure.

Senior BP executives and government officials, once again, had publicly offered optimistic predictions about the success of the technique, which involved pumping in heavy drilling mud and, in a process known as a junk shot, assorted objects including golf balls. Privately, it turned out, some engineers with BP and with Wild Well Control, a contractor, were far less confident that the top kill would work.

For three days, engineers worked high-powered pumps on two surface ships to overcome the oil and gas belching out of the well.

At one point, technicians said in interviews, a plumbing problem on one of the pump ships forced a delay in the operation. Then a screaming match over the radio between two senior engineers ended in one of them threatening to come over and throw the other overboard.

At the Houston command center, officials assembled to monitor the top kill. A BP technician called out pressure readings. Dr. Chu, in shirtsleeves, performed his own calculations with paper and pen.

As they watched, the pressures started to decrease — a sign that the pumped-in drilling mud was succeeding in overcoming the pressure of the oil spewing out of the well. There were high-fives around the room, and government officials sent text messages to the White House saying that victory might be near.

But an hour later, the pressure readings leveled off. The attempt had failed.

The next day, Dr. Chu, concerned about putting too much pressure on the well, ordered an end to the operation. It was a turning point: the government was now in charge, and with greater frequency, Energy Department officials and scientists were conferring with Exxon Mobil and Shell engineers, asking for advice about what to do next.

For BP’s engineers and technicians, it was one more thing to be depressed about. Mr. Mazzella recalled the faces of his crew members when they returned from the ships by helicopter to Houma, La., after the top kill had failed.

“They were down, they were,” he said. “It impacted everybody when we had to walk away from that thing and the oil was still flowing.”

“Everybody came up to me,” Mr. Mazzella said, “and they were almost apologetic — ‘We’re sorry we didn’t get this done.’ ”

His voice trailed off. “We didn’t get this done,” he repeated softly.

Learning From Failures

With the top kill abandoned, “it was quite obvious that this was going to keep going for some time,” Mr. Tooms recalled. The problems facing the team seemed overwhelming.

“I didn’t feel like I had the answers,” he said.

For the most part, Mr. Tooms said, he was able to ignore the news clippings sent by friends back home in Britain. But reports in the American news media would send him ranting to his boss.

At the same time, government scientists were starting to press BP for more data and more analysis.

Dr. Chu told his Energy Department associates he was no longer willing to settle for half-measures or wishful thinking. “I wanted to make sure this thing is really killed dead, dead, dead,” he said in an interview.

But Kent Wells, a BP senior vice president who early on became the effort’s public face, said in an interview that looking back, the Houston engineers had learned something from the failures. The experience with the cofferdam, for example, had taught them a better way to cap the well — avoiding the formation of the icelike crystals by first lowering the capping device to the seabed off to the side, away from the plume of oil, then sliding it into place. This paid off less than a month later, he said, when engineers installed a loose-fitting “top hat” cap on the well.

The top hat was the first modest success, eventually funneling about 15,000 barrels of oil a day for surface collection. But it was viewed only as a stopgap; what was needed, many on the team were convinced, was a more radical approach, one that had been proposed only a few days after the blowout on the Deepwater Horizon rig, when the team brainstormed solutions to the disaster: a tight-fitting cap.

“To meaningfully go forward in any rational way required a pretty bold step, which was to open up the flow again and put a device on that that would give you some pressure control,” Mr. Tooms said. “That was for me the defining moment.”

A Pressing Question

As bolts go, this one was enormous: nearly a foot and a half long and tipping the scales at 51 pounds. With five identical ones, it held what remained of the broken riser pipe atop the well’s crippled blowout preventer at the seabed.

If there was to be any hope of putting on the cap and shutting off the flow of oil before the relief well did the job later in the summer, the bolts had to be removed. But no one knew how stuck they might have become by sitting in the deep for so long.

To the public, their expectations dulled by the repeated failures, a tight-fitting cap was just one more hill on a four-month roller coaster ride. But engineers were focused on a single pressing question: Could the bolts could be loosened by remotely operated submersibles, the high-tech marionettes that did the work in the crushing pressures and frigid temperatures 5,000 feet down?

The engineers scrounged around and came up with the biggest subsea torque wrench they could find, and watched from the Houston command center as a remotely operated submersible used it to easily loosen one of the bolts.

That seemingly simple act was a game-changer, said Mr. Lynch, the BP vice president.

“Suddenly,” he said, “I’ve got a pressure containment device I can put on this, and it’s real and it works. Now I’ve got an opportunity to close the well in.”

Which is what the engineers did several days later, bolting on the new device, called a capping stack, and preparing to conduct an “integrity test” by slowly closing valves on the stack and raising the pressure in the well.

Yet the test was delayed, a fact that BP and government officials publicly attributed to a benign request by the government for more information. In fact, a dispute had erupted. BP wanted to go ahead with the tests. Dr. Chu and his advisers were blocking them. Closing the valves, they argued, could force the oil out of the well and make a bad situation much worse.

The government team convened a conference call with hydrologists and geophysicists from universities and other oil companies. They raised alarms to Mr. Wells, Andy Inglis, BP’s chief executive for exploration and production, and James Dupree, a BP senior vice president, who continued to insist that the procedure was safe, administration sources say.

“Chu raised his concerns about the subsea geology with the BP people and they couldn’t answer his questions,” an aide to the energy secretary said. “The result was that the plan to conduct the integrity test was halted for 24 hours.”

Some BP executives, a government official said, were furious, skipping some of the scheduled engineering meetings over the next several days.

“It was like, ‘Where the hell are they?’ ” the official said. “It was frustrating to them that people were still asking questions.”

Eventually, BP engineers persuaded the government to continue with the test, and on July 15, Mr. Tooms stood in the engineering room, watching the valves being closed on video feeds.

The room was hushed, except for the background radio chatter between technicians in Houston and out in the gulf, calling out pressure readings and the number of turns as the final valve was dialed closed. “And then there was almost kind of a pause,” Mr. Tooms said, “kind of like a realization that it stopped.”

At two news conferences on July 16 — the tension between the government and BP had long before led them to hold briefings separately — Mr. Wells and Thad W. Allen, the retired Coast Guard admiral who led the federal government’s response to the spill, announced that the test had started. Oil was no longer flowing into the gulf. On BP’s live video feed, the torrents of oil and gas gave way to images of small white particles drifting lazily through the water past a quiet metal hulk.

Yet how long the respite would last was uncertain. The government scientists were still skeptical about leaving the cap closed, while BP engineers were convinced that the well could handle the pressure.

The issue came to a climax at a meeting the next morning in the 20th-floor boardroom at the BP office tower. Mr. Tooms’s team took up many of the 22 seats around the long conference table. They were joined by government scientists. Dr. Chu was dialed in by speaker phone, as were Carol Browner, President Obama’s adviser on environmental issues, and Admiral Allen.

“We just laid out our technical case of why we believed what we believed,” Mr. Tooms said. “When you have the level of intellectual you are talking to, they are going to ask you questions about why your technical case is correct. And we went through all that.”

It would prove a pivotal moment. After hours of discussion, the government agreed to keep the cap closed. The pressure held, the flow of oil remained shut off and BP could eventually proceed with plans to seal the well permanently.

“Had we opened it up at that point that would have been, I think, probably the darkest moment in my career,” Mr. Tooms said.

One More Twist

In the weeks after the oil was shut off, the well offered up one final surprise.

The story had gradually receded from the headlines — a comfort to BP executives, who had watched the company’s stock price plummet, and to the Obama administration, which had been criticized for the speed of its response to the leak.

But on Aug. 2, as workers prepared to pump mud into the well to kill it permanently, an engineer stuck his head into office of Mr. Lynch, the BP vice president.

“Richard, we’ve got a problem,” the engineer said.

A hydraulic leak had caused a critical valve on the cap to open up again. A second, fail-safe valve behind it was being kept closed by little more than friction. If that second valve opened, oil and gas would again start pouring into the gulf.

In the end, the valve held, and a renewed nightmare was averted.

But as Mr. Lynch recalled, “The difference between us having the well shut and everything going swimmingly well and the fact that we could have been flowing hydrocarbons back into the sea was that close.”

    Behind Scenes of Gulf Oil Spill, Acrimony and Stress, NYT, 26.8.2010, http://www.nytimes.com/2010/08/27/us/27well.html

Math Lessons for Locavores

August 19, 2010
The New York Times
By STEPHEN BUDIANSKY

Leesburg, Va.

IT’S 42 steps from my back door to the garden that keeps my family supplied nine months of the year with a modest cornucopia of lettuce, beets, spinach, beans, tomatoes, basil, corn, squash, brussels sprouts, the occasional celeriac and, once when I was feeling particularly energetic, a couple of small but undeniable artichokes. You’ll get no argument from me about the pleasures and advantages to the palate and the spirit of eating what’s local, fresh and in season.

But the local food movement now threatens to devolve into another one of those self-indulgent — and self-defeating — do-gooder dogmas. Arbitrary rules, without any real scientific basis, are repeated as gospel by “locavores,” celebrity chefs and mainstream environmental organizations. Words like “sustainability” and “food-miles” are thrown around without any clear understanding of the larger picture of energy and land use.

The result has been all kinds of absurdities. For instance, it is sinful in New York City to buy a tomato grown in a California field because of the energy spent to truck it across the country; it is virtuous to buy one grown in a lavishly heated greenhouse in, say, the Hudson Valley.

The statistics brandished by local-food advocates to support such doctrinaire assertions are always selective, usually misleading and often bogus. This is particularly the case with respect to the energy costs of transporting food. One popular and oft-repeated statistic is that it takes 36 (sometimes it’s 97) calories of fossil fuel energy to bring one calorie of iceberg lettuce from California to the East Coast. That’s an apples and oranges (or maybe apples and rocks) comparison to begin with, because you can’t eat petroleum or burn iceberg lettuce.

It is also an almost complete misrepresentation of reality, as those numbers reflect the entire energy cost of producing lettuce from seed to dinner table, not just transportation. Studies have shown that whether it’s grown in California or Maine, or whether it’s organic or conventional, about 5,000 calories of energy go into one pound of lettuce. Given how efficient trains and tractor-trailers are, shipping a head of lettuce across the country actually adds next to nothing to the total energy bill.

It takes about a tablespoon of diesel fuel to move one pound of freight 3,000 miles by rail; that works out to about 100 calories of energy. If it goes by truck, it’s about 300 calories, still a negligible amount in the overall picture. (For those checking the calculations at home, these are “large calories,” or kilocalories, the units used for food value.) Overall, transportation accounts for about 14 percent of the total energy consumed by the American food system.

Other favorite targets of sustainability advocates include the fertilizers and chemicals used in modern farming. But their share of the food system’s energy use is even lower, about 8 percent.

The real energy hog, it turns out, is not industrial agriculture at all, but you and me. Home preparation and storage account for 32 percent of all energy use in our food system, the largest component by far.

A single 10-mile round trip by car to the grocery store or the farmers’ market will easily eat up about 14,000 calories of fossil fuel energy. Just running your refrigerator for a week consumes 9,000 calories of energy. That assumes it’s one of the latest high-efficiency models; otherwise, you can double that figure. Cooking and running dishwashers, freezers and second or third refrigerators (more than 25 percent of American households have more than one) all add major hits. Indeed, households make up for 22 percent of all the energy expenditures in the United States.

Agriculture, on the other hand, accounts for just 2 percent of our nation’s energy usage; that energy is mainly devoted to running farm machinery and manufacturing fertilizer. In return for that quite modest energy investment, we have fed hundreds of millions of people, liberated tens of millions from backbreaking manual labor and spared hundreds of millions of acres for nature preserves, forests and parks that otherwise would have come under the plow.

Don’t forget the astonishing fact that the total land area of American farms remains almost unchanged from a century ago, at a little under a billion acres, even though those farms now feed three times as many Americans and export more than 10 times as much as they did in 1910.

The best way to make the most of these truly precious resources of land, favorable climates and human labor is to grow lettuce, oranges, wheat, peppers, bananas, whatever, in the places where they grow best and with the most efficient technologies — and then pay the relatively tiny energy cost to get them to market, as we do with every other commodity in the economy. Sometimes that means growing vegetables in your backyard. Sometimes that means buying vegetables grown in California or Costa Rica.

Eating locally grown produce is a fine thing in many ways. But it is not an end in itself, nor is it a virtue in itself. The relative pittance of our energy budget that we spend on modern farming is one of the wisest energy investments we can make, when we honestly look at what it returns to our land, our economy, our environment and our well-being.


Stephen Budiansky is the author of the blog liberalcurmudgeon.com.

    Math Lessons for Locavores, NYT, 19.8.2010, http://www.nytimes.com/2010/08/20/opinion/20budiansky.html

Mexican Guest Workers, Laid Off, Want BP’s Help

August 5, 2010
The New York Times
By TAMAR LEWIN

NEW ORLEANS — Soon after the oil from the Deepwater Horizon began gushing into the Gulf of Mexico, business at the Ramada Plaza Beach Resort in Fort Walton Beach, Fla., dried up — and so did the jobs of five Mexican housekeepers who were guest workers at the hotel under contracts guaranteeing them work until Nov. 1.

“On June 30, they told us our jobs were over, and that we had to leave our housing and go back to Mexico,” Salvador Luna Espinoza, one of the housekeepers, said in a telephone interview conducted with a translator. “I’m staying with friends now, but I don’t know how long they’ll put up with me.”

While thousands have lost their jobs as a result of the oil spill, the layoffs present special hardships for guest workers, mostly hotel workers and those working in shellfish processing.

Under their H-2B visas, they are allowed to work only for the employer who arranged their visa, and they must leave the United States within 10 days of losing their job.

Most took on debt of $1,000 or more to pay for the trip to the United States, planning to pay it back with their earnings.

Mr. Luna Espinoza, who has a wife and five children at home in El Tizate, Mexico, said that without the $7.75-an-hour hotel job, he had no hope of repaying his debt — and unless he could do so, no one would back him in arranging another visa or another job.

So he is still in the United States, awaiting compensation.

“What they face is basically a guillotine the moment they’re laid off,” said Saket Soni, executive director of the Alliance of Guestworkers for Dignity, a grass-roots New Orleans organization that is helping the laid-off housekeepers, and other guest workers laid off from a Baton Rouge seafood processor, file claims with BP. “We would like to see them treated not as disposable workers, but as people who deserve relief in a disaster.”

In theory, guest workers have the same rights to compensation from BP as anyone else who lost income due to the oil spill. But as a practical matter, getting that compensation is far more difficult for workers from another county, who speak little English and may not understand the claims process or have the documentation from employers to file a claim.

With the help of Mr. Soni’s alliance, Mr. Luna Espinoza filed a BP claim for lost wages of $5,498.63, backed up by a letter from Ramada saying that his layoff was due to the oil spill. He has not yet received compensation, though. On July 9, the alliance filed a petition with the Labor Department, asking that it issue a formal policy directing those in the spill zone who employ guest workers to pay all the wages due under the contract, as well as the guest workers’ fare home.

“It shouldn’t be on the guest workers’ shoulders to bear the costs of the spill,” Mr. Soni said. “The employers are in a much better position to get BP to reimburse them.”

Indeed, guest workers are in a tenuous position, usually living in labor camps or other housing run by their employers, with little connection to the surrounding community, and little understanding of their legal rights. Many fear retaliation from employers or immigration authorities if they make complaints. And when their jobs end suddenly, many have no idea where to turn, and, like Mr. Luna Espinoza, drift off to stay with someone from their home country.

The alliance petition said many guest workers would no longer be in the United States when any compensation was issued. If BP does issue Mr. Luna Espinoza a check, it will be sent to the alliance, since he has no fixed address.

At the Labor Department, a spokeswoman for Nancy Leppink, deputy administrator of the Wage and Hour Division, would say only that the division would “respond appropriately” to the alliance’s petition.

At the Ramada, business is still depressed, said Joseph Guidry, the general manager. Mr. Guidry declined to comment on the petition or the issue of requiring employers to pay out the contract and then await reimbursement from BP.

Mr. Luna Espinoza said he had been a guest worker before, working on a tobacco farm in Virginia. So which did he prefer?

“It was much better in tobacco,” he said. “They had more hours of work for me.”

    Mexican Guest Workers, Laid Off, Want BP’s Help, NYT, 5.8.2010, http://www.nytimes.com/2010/08/06/us/06guest.html

BP Done Pumping Cement Into Well

August 5, 2010
The New York Times
By CLIFFORD KRAUSS

HOUSTON — For more than three months, an oil-weary nation has waited for the moment when engineers would begin pumping cement into BP’s runaway well, in hopes of plugging its flow for good.

That moment arrived quietly on Thursday, with cement following the tons of mud already poured into the well in the operation called a static kill. Because no significant amount of oil has leaked since the well was tightly capped on July 15, the start of the cementing was almost anticlimactic. BP did not even hold its regular daily briefing, saying that Kent Wells, the senior vice president who usually explains the technical details to reporters, was traveling. When the cement operation was completed in the afternoon, the company put out a brief announcement.

Television newscasts, for months fixated on the spectacle of oil gushing from the broken riser pipe on live underwater video, barely covered the transition.

Thad W. Allen, the retired Coast Guard admiral who heads the federal spill response effort, told reporters at the government’s midday briefing that once the cement job was completed, “We can all breathe a little easier.” He added, “This is not the end, but it will virtually assure us there will be no chance of oil leaking into the environment.”

By applying cement to the well from a surface vessel, technicians can plug most, if not all, of the drill pipe and oil reservoir below.

Although the static kill is likely to seal the volatile well permanently, final victory will not be declared until a relief well is completed and it intercepts the well in the middle to later part of August, according to both Admiral Allen and senior BP executives.

The first of two relief wells is still 100 feet from intersecting the Macondo well. It will take five to seven days to complete once the cement applied during the static kill dries by the weekend’s end. A second relief well is being drilled in case the first misses the mark.

Since blowing out on April 20, killing 11 workers aboard the Deepwater Horizon platform, the well has spewed nearly five million barrels of crude oil into the Gulf of Mexico. The tight-fitting capping device that stopped the leak three weeks ago was considered a temporary solution.

Because the static kill is not guaranteed to pour cement through the annulus, the portion of the drill pipe between the inner piping and the outer casing, leakage may still remain after the kill, according to officials. But the 18,000-foot relief well can penetrate the entire pipe, after which technicians can test to see how much more cement is needed to kill the well completely.

Technicians working on the static kill said that they could not guarantee that the well was now fully plugged. They said they had not been able to determine whether any oil and gas remained trapped in the casing, drill pipe or annular areas that might have been bypassed by the injection of mud and cement.

“It’s almost like a mystery you are trying to unravel,” Admiral Allen said. “The question is: what is the path of the cement to the bottom?”

Admiral Allen said the mystery would be solved conclusively only by the relief well, and by a final pumping of mud and cement into any areas not reached by the static kill.

But Greg McCormack, program director of the Petroleum Extension Service at the University of Texas Austin, said, that the fact that the cementing was finished so quickly “means they had a good cement job, which means that they probably cemented all the way down to the bottom in the production casing and reached the reservoir.”

He added, “If there aren’t any leaks anywhere else, that means this well is done.”

    BP Done Pumping Cement Into Well, NYT, 5.8.2010, http://www.nytimes.com/2010/08/06/us/06spill.html

Oil Spill Cleanup Workers Include Many Very, Very Small Ones

August 4, 2010
The New York Times
By WILLIAM J. BROAD

Among the hidden stars of the gulf cleanup is an oil-hungry bacterium that Dr. Seuss could have named — Alcanivorax. It and fellow microbes are breaking down a significant amount of the oil that gushed into the environment from BP’s runaway well, scientists say. The microbial feasting is known as biodegradation.

On Wednesday, a report released by the National Oceanic and Atmospheric Administration said early observations showed that the oil from the Deepwater Horizon spill “is biodegrading quickly,” adding that scientists were working to measure how quickly and how much of the escaped oil the microbial hordes could consume.

“Until it is biodegraded, naturally or chemically dispersed oil, even in small amounts, can be toxic to vulnerable species,” the report says in pointing to the importance of the microbes.

The report said the swarms were dining on most remaining aspects of the spill — dispersed oil as well as oil forming a sheen on or just below the surface.

“Colleagues who have been sampling tell me that the intrinsic biodegration rates are high,” said Ronald M. Atlas, a microbiologist at the University of Louisville and past president of the American Society for Microbiology. “I believe that most of the oil will not have a significant impact. That’s been the story with spills that stay offshore.”

Dr. Atlas cautioned, however, that microbe degradation in polluted marshes “should be considerably slower.”

And other scientists warn that the sudden appearance of swarms of oil-hungry microbes in the Gulf of Mexico could have drawbacks, saying they might consume so much oxygen that oxygen levels drop precipitously, threatening other sea life.

Samantha B. Joye, a marine scientist at the University of Georgia, told a House science subcommittee this year that drops in oxygen could especially threaten an unusual class of creatures that also live on oil: communities of clams, mussels and tube worms that flourish in the sunless depths of the gulf.

The gulf proper has an enormous ability to break down oil because thousands of natural seeps in the seabed leak oil and gas at a fairly steady rate, and have for millions of years. None are close in size to the Deepwater Horizon leak. But over the ages, swarms of microbes and other creatures have learned how to live on petrochemicals flowing from the fissures, giving the gulf some powers of natural recuperation.

Scientists say a star of the feasting is Alcanivorax — its name alluding to its voracious appetite for alkanes, some of the main chemicals of natural gas and petroleum. In unspoiled environments around the world, the marine bacterium exists in limited numbers. But it rapidly multiplies in oil-contaminated waters, as scientists portray the usual state of the gulf.

“It’s preadapted to crude oil,” said Roger Sassen, a gulf specialist recently retired from Texas A&M University who has long argued that natural remediation would cleanse its waters. “The image of this spill being a complete disaster is not true.”

In the report on Wednesday, the federal panel echoed that optimism in diplomatic language.

“It is well known,” the report said, “that bacteria that break down the dispersed and weathered surface oil are abundant in the Gulf of Mexico in large part because of the warm water, the favorable nutrient and oxygen levels, and the fact that oil regularly enters the Gulf of Mexico through natural seeps.”

Wednesday’s report also highlighted the effects of oil dispersion — a strategy that some critics of BP had faulted, especially as the company pumped chemicals into the depths that were meant to scatter the gushing oil. The report said dispersion at the surface and in the deep “increases the likelihood that the oil will be biodegraded” by billions of oil-eating microbes.

Dr. Atlas of the University of Louisville agreed. But he noted that “the extensive use of dispersants has been of toxicological concern.”

Hopes for the natural remediation of oil spills at sea have grown in recent years as scientists have discovered a new class of microbes known as hydrocarbonoclastic, a group that includes Alcanivorax. The name hydrocarbonoclastic denotes the disassembly of hydrocarbons, the building blocks of oil.

A 2003 report by the National Research Council, “Oil in the Sea,” called the biodegradation of hydrocarbons “one of the principal removal mechanisms in the aquatic environment,” as well as “a premiere research area.”

That same year, a team of German scientists reported that it had deciphered the genome of Alcanivorax, shedding light on the microbe’s genetic structure and raising the possibility of enhancing its oil-eating abilities.

Jay Lennon, a microbial ecologist at Michigan State University, said the gene sequencing helped show how Alcanivorax could break down the surface tension in fluids and attack oil.

“Micro-organisms are pretty amazing,” he said. “If there’s a way for them to make a living, they’ll do it.”

    Oil Spill Cleanup Workers Include Many Very, Very Small Ones, NYT, 4.8.2010, http://www.nytimes.com/2010/08/05/science/earth/05microbe.html

In Gulf, Good News Is Taken With Grain of Salt

August 4, 2010
The New York Times
By CAMPBELL ROBERTSON

NEW ORLEANS — There is little celebration on the Gulf Coast.

Even with the news of the tentative plugging of BP’s well, the attention here has largely been focused elsewhere, on a week’s worth of reports, culminating in a federal study released on Wednesday, that the oil in the Gulf of Mexico has been rapidly breaking down and disappearing. These reports have been met, for the most part, with skepticism if not outright distrust.

“It’s not gone,” said George Barisich of the United Commercial Fisherman’s Alliance, who has been making his money these days selling anti-BP T-shirts while also working in the Vessels of Opportunity program, a BP effort created to employ boats to help with the spill cleanup. “Mother Nature didn’t suck it up and spit it out.”

According to federal scientists, about a third of the oil was captured or mitigated by recovery efforts, a quarter naturally dissolved or evaporated and 16 percent was dispersed into microscopic droplets. Just over a quarter remains on or below the surface or has washed ashore, and is either being collected or is degrading naturally.

But many here have grown skeptical after the false assurances following Hurricane Katrina, the early flow rate estimates from BP and federal agencies that turned out to be drastically low and cautionary tales from Alaska about the Exxon Valdez disaster.

The skepticism has been stoked by environmental groups that came to the gulf in droves, lawyers who have been soliciting clients from billboards along roads leading south, a sensation-hungry news media and politicians who have gained broad popularity for thundering in opposition to response officials.

But it has also been fed by continued discoveries of oil clumped in marshes, stratified underneath fresh sand or exposed in the surf at low tide. These sightings do not contradict the scientific reports, which acknowledge millions of gallons of residual oil, but they fuel a broadly held fear: that the oil is merely hidden, liable to appear in a thick, brown ooze at any time.

Federal scientists and coastal residents agree in at least one respect: that the long-term effects of the spill are unknown, and that it is too early to make any conclusions about the true scale of the damage. That uncertainty leads to perhaps the most potent source of skepticism: a deep anxiety about the region’s economic future.

The anxiety begins in the short term. Billions of dollars have poured into the gulf during the response, supporting coastal communities that have had a dreary summer but also enriching contractors involved in the cleanup. Any news of dissipating oil hints at a looming end to that.

BP has promised full compensation, but that has not stopped officials and residents from pursuing lawsuits or seeking billions more in restoration payments.

Just as the problems were being ironed out in the Vessels of Opportunity program, which had left many hurting commercial fishermen on the outside, recoverable oil started disappearing on the surface.

Plenty are worried that there will be no revenue to take the program’s place as it wraps up.

“Even if it is true,” Mr. Barisich said of the reports of dissipating oil, “and I can go catch some shrimp right now, I can’t sell it. I don’t have a dealer or processor who can take it right now.”

Commercial fishing waters are being opened all along the coast, which can be done only with the approval of the Food and Drug Administration and after a variety of tests. But many fishermen, who early on were angered at what they saw as premature closings of water where little oil was visible, are now among the most concerned that the waters are being opened too quickly.

The perception of healthy seafood is nearly as important for the business as the reality, and reassuring consumers can be a long and tricky process.

“Alaska, it took them almost five years to overcome their perception challenges,” said Ewell Smith, the executive director of the Louisiana Seafood Promotion and Marketing Board.

And while BP has recently highlighted its efforts to speed up the claims process, more than two-thirds of claims have not been paid, mostly because adjusters are waiting on documentation that may be hard to come by for many in the largely cash-driven fishing business.

But the economic worries still come back to a fundamental disagreement: many residents simply do not believe that the oil is going away anytime soon, whatever scientists are saying.

“Smell that?” asked Forrest A. Travirca III, driving along the beach at Port Fourchon, La., on Monday. He climbed out of his cart and waded into the surf, where low tide had exposed mud flats, thick and dark with oil to a depth of three inches. The sight could be found up and down the beach.

Mr. Travirca, the field inspector for the Edward Wisner Donation, a nonprofit land trust, said that the oil had probably accumulated since late May, left by subcontracted cleanup crews that had done an incomplete job.

Both BP and federal response officials repeat that the cleanup will not be over until the beaches and marshes are clean, and that crews will not leave until local officials are satisfied. Mr. Travirca said the cleanup had been improving and gave high marks to the Coast Guard.

But the oil-caked mud flats provoked concern about the oil that may be unseen, buried all along the beach or sitting on the seabed offshore. Federal scientists said they had found that oil was not gathering on the floor of the gulf, but Mr. Travirca said he had a hard time believing that.

Fishermen are also keenly concerned about shrimp, crab and finfish larvae. If the larvae are in jeopardy, it may not be known until future fishing seasons, even after the cleanup ends.

Scientists have found hydrocarbons and possibly dispersant in samples of crab and fish larvae, but say that it is premature to draw any conclusions about the long-term effects.

That uncertainty is not reassuring, and to many here it is, in its own way, proof of deception. Response officials acknowledge that the use of dispersants was a trade-off, exposing marine life to risk but preventing a thorough oiling of the beaches and fragile marshes. And for such a huge spill, it has had a relatively small coastal impact.

But others say it was also convenient that the dispersant kept most of the oil out of public view.

“I think probably in the long term the application of the dispersants, at least at the wellhead, probably was the right thing to do,” said Dr. William E. Hawkins, director of the Gulf Coast Research Laboratory of the University of Southern Mississippi. “But cynically I might say BP might have done it for the wrong reasons.”

    In Gulf, Good News Is Taken With Grain of Salt, NYT, 4.8.2010, http://www.nytimes.com/2010/08/05/us/05gulf.html

Oil Spill Capped for a Second Day, Offering Some Hope

July 16, 2010
The New York Times
By CAMPBELL ROBERTSON and HENRY FOUNTAIN

NEW ORLEANS — The hemorrhaging well that has spilled millions of gallons of oil into the Gulf of Mexico remained capped for a second day Friday, providing some hope of a long-term solution to the environmental disaster.

Live video from the seabed Friday morning showed that all was quiet around the top of the well, suggesting the test assessing the integrity of the well was continuing. Earlier in the week, Kent Wells, a senior vice president for BP, had said that the longer the test continued the better, because it would indicate that the pressure inside the well was holding.

The oil stopped flowing around 2:25 p.m. Thursday when the last of several valves was closed on a cap at the top of the well, Mr. Wells said.

The announcement that the oil had stopped flowing into the Gulf came after a series of failed attempts to cap or contain the runaway well that tested the nation’s patience. Mr. Wells emphasized that pressure tests were being conducted to determine the status of the well, which is now sealed like a soda bottle. BP and the government could decide to allow the oil to flow again and try to collect all of it; they could allow the oil to flow and, if tests show the well can withstand the pressure from the cap, close the well during hurricanes; or they could leave the well closed permanently.

The last option seems unlikely, but whatever the decision, the cap is an interim measure until a relief well can plug the leak for good.

“I am very pleased that there’s no oil going into the Gulf of Mexico,” Mr. Wells said, “but we just started the test and I don’t want to create a false sense of excitement.”

That was not much of a risk along the Gulf Coast, where countless livelihoods have been put in jeopardy and fishermen frequently and gloomily remark that Prince William Sound has never been the same since the Exxon Valdez disaster.

“It’s like putting a Band-Aid on a dead man in my opinion,” said Jeff Ussury, 48, who considers his days as a crabber over for good. He doubted the news of the capping was even true.

“I started out kind of believing in them,” he said, “but I don’t believe in them at all anymore.”

Whether it was just the eye of the hurricane or the morning after the storm, the moment was a time to take stock of just how much damage had already been done since the deadly explosion on the Deepwater Horizon oil rig on the night of April 20.

For weeks, the BP spill camera — which along with terms like “top kill,” “containment dome” and “junk shot” made up a growing list of phrases that many people wish they had never learned — had shown a horrible chocolate plume of oil pouring upward from the broken blowout preventer, a symbol of government and corporate impotence. The plume has been a constant presence in the corner of TV screens, mocking reassurances from officials on the news programs who describe the latest attempt to stop the gushing.

But the view on Thursday afternoon was eerily tranquil, just the slate blue of the deep interspersed with small white particles floating across the screen. Though the exact amount of the oil that has poured out of the well may never be known, it was suddenly and for the first time a fixed amount. The disaster was, for a little while at least, finite.

At the White House, President Obama called the development a “positive sign,” though he cautioned that the operation was still in the testing phase.

In statements, Louisiana officials, including Gov. Bobby Jindal, said they were “cautiously optimistic.”

Officials at all levels played down expectations. Thad W. Allen, the retired Coast Guard admiral who is coordinating the spill response, told reporters on Thursday that the cap was primarily meant to be used to shut the well during extreme weather.

“The intention of the capping stack was never to close in the well per se,” he said. “It creates the opportunity if we have the right pressure readings to shut in the well. It allows us to abandon the site if there is a hurricane.”

He said that after the test, the cap would be used to capture oil through surface ships — two that are on the site now and two more that will be in operation in a week or two. With all four collection ships in place, BP could capture all of the oil, estimated at 35,000 to 60,000 barrels per day.

Mr. Wells cautioned that the test could take 48 hours or more, as scientists study pressure readings from the cap. If pressure rises and holds, that would be a sign that the casing — the 13,000-foot string of pipe that lines the well bore — is undamaged.

But if the pressure stays low or falls, that would suggest the well is damaged. In that case, Mr. Wells said, the test probably would be stopped well ahead of schedule, valves would be reopened and collection systems that had been shut down for the test would start again.

“Depending on what the test shows us, we may need to open this well back up,” he said.

The test had been delayed by about two days, first when the government ordered a last-minute review of the procedure out of concern that, by allowing the buildup of pressure, the test itself might harm the well. A particular fear, experts said, was that it might cause a shallow blowout — damaging the well lining close to the seabed, which could allow oil and gas to escape into the gulf outside the well, making the spill worse.

By Wednesday afternoon, those concerns had been allayed and preparations were made to begin the test. But late that night, a hydraulic leak was discovered in part of the choke valve equipment, and the test was scrubbed.

Thursday afternoon the test began again, first with the shutting down of pipes that funneled oil and gas to two surface ships.

In even the most optimistic case, the BP oil spill is far, far from over.

There are still millions of barrels of oil out in the gulf and months of work missing for fishermen and shrimpers; inestimable harm is still being inflicted on wildlife throughout the food chain; and anger still seethes along the Gulf coast.

“What’s to celebrate?” asked Kindra Arnesen, the wife of a shrimper from Plaquemines Parish, La., who has become a recognizable voice of outrage over the past two and a half months.

“My way of life’s over, they’ve destroyed everything I know and love,” she said, before going on to explain, in detail, why she believes the pressure tests are likely to fail.


Liz Robbins contributed reporting from New York.

    Oil Spill Capped for a Second Day, Offering Some Hope, NYT, 16.7.2010, http://www.nytimes.com/2010/07/17/us/17spill.html

Animal Autopsies in Gulf Reveal Only a Mystery

July 14, 2010
The New York Times
By SHAILA DEWAN

GAINESVILLE, Fla. — The Kemp’s ridley sea turtle lay belly-up on the metal autopsy table, as pallid as split-pea soup but for the bright orange X spray-painted on its shell, proof that it had been counted as part of the Gulf of Mexico’s ongoing “unusual mortality event.”

Under the practiced knife of Dr. Brian Stacy, a veterinary pathologist who estimates that he has dissected close to 1,000 turtles over the course of his career, the specimen began to reveal its secrets: First, as the breastplate was lifted away, a mass of shriveled organs in the puddle of stinky red liquid that is produced as decomposition advances. Next, the fat reserves indicating good health. Then, as Dr. Stacy sliced open the esophagus, the most revealing clue: a morsel of shrimp, the last thing the turtle ate.

“You don’t see shrimp consumed as part of the normal diet” of Kemp’s ridleys, Dr. Stacy said.

This turtle, found floating in the Mississippi Sound on June 18, is one of hundreds of dead creatures collected along the Gulf Coast since the Deepwater Horizon oil rig exploded. Swabbed for oil, tagged and wrapped in plastic “body bags” sealed with evidence tape, the carcasses — many times the number normally found at this time of year — are piling up in freezer trucks stationed along the coast, waiting for scientists like Dr. Stacy, who works for the National Oceanic and Atmospheric Administration, to begin the process of determining what killed them.

Despite an obvious suspect, oil, the answer is far from clear. The vast majority of the dead animals that have been found — 1,387 birds, 444 turtles, 53 dolphins and one sperm whale — show no visible signs of oil contamination. Much of the evidence in the turtle cases points, in fact, to shrimping or other commercial fishing, but other suspects include oil fumes, oiled food, the dispersants used to break up the oil or even disease.

The efforts to finger a culprit — or culprits — amount to a vast investigation the likes of which “CSI” has never seen. The trail of evidence leads from marine patrols in Mississippi, where more than half the dead turtles have been found, to a toxicology lab in Lubbock, Tex., to this animal autopsy room at the University of Florida in Gainesville. And instead of the fingerprint analysis and security camera footage used in human homicides, the veterinary detectives are relying on shrimp boat data recorders and chromatographic spectrum analysis that can tell if the oil residue found in an animal has the same “chemical signature” as BP crude.

The outcome will help determine how many millions BP will pay in civil and criminal penalties — which are far higher for endangered animals like sea turtles — and provide a wealth of information about the little-known effects of oil on protected species in the Gulf.

“It is terribly important to know, in the big scheme of things, why something died,” said Moby Solangi, the director of the Institute for Marine Mammal Studies in Gulfport, Miss., where the initial turtle necropsies and some dolphin necropsies were performed.

“We might be doing what we can to address the issues of today and manage the risk,” he said. “But for tomorrow, we need to know what actually happened.”

Searching for a Smoking Gun

In a laboratory at Texas Tech University in Lubbock, Jennifer Cole, a graduate student, was slicing a precious chunk of living dolphin tissue into .3-millimeter sections.

Supervised by Céline Godard-Codding, an endangered species toxicologist, Ms. Cole was studying cytochrome P450 1A1, an enzyme that breaks down hydrocarbons.

Tissue samples are one of the only ways to learn more about toxins in marine mammals and sea turtles, whose protected status limits the type of studies that can be done — researchers cannot do experiments to determine how much oil exposure the animals can withstand.

Oil — inhaled or ingested — can cause brain lesions, pneumonia, kidney damage, stress and death. Scientists working on the BP spill have seen oil-mired animals that are suffering from extreme exhaustion and hyperthermia, with the floating crude reaching temperatures above 130 degrees, Dr. Stacy said.

Far less is known about the effects of dispersants, either by themselves or mixed with oil, though almost 2 million gallons of the chemicals have been used in the BP spill.

Studies show that dispersants, which break down oil into tiny droplets and can also break down cell membranes, make oil more toxic for some animals, like baby birds. And the solvents they contain can break down red blood cells, causing hemorrhaging. At least one fresh dolphin carcass found in the Gulf was bleeding from the mouth and blowhole, according to Lori Deangelis, a dolphin tour operator in Perdido Bay.

Investigators plan to take skin and mouth swabs, slices of organ tissue and vials of bile from animals that have died and test them for disease and hydrocarbons, as well as for dispersants, before a final report on the cause of death is written. But no samples have yet been sent to labs, because NOAA scientists are still debating what types of results will prove most useful.

Jacqueline Savitz, a marine biologist with Oceana, an environmental group, said there was no excuse for any delay in testing.

“It’s absolutely urgent that it should be done immediately,” she said, because the findings could influence response measures like BP’s experimental use of dispersants underwater.

In the meantime, at places like the Tech institute, the oil spill has set off a mad scramble to fill in the gaps in knowledge. In one laboratory, jars of BP crude in various stages of weathering await analysis to determine their relative toxicity. In another lab, graduate students paint precise amounts of oil on incubating duck eggs. Tanks of fiddler crabs awaited a shipment of Corexit 9500, the dispersant being used by BP in the Gulf.

In the end, Dr. Godard-Codding said, scientists will not find a single smoking gun. The evidence — results of laboratory tests, population counts, assessments of how well oil-drenched animals survive after rehabilitation — will all be circumstantial.

Suspicions Fall on Shrimpers

When Lt. Donald Armes of the Mississippi Marine Patrol heard about the rash of dead sea turtles littering the state’s shores, his first thought was not of oil but of shrimp boats.

“Right off the bat, you figure somebody’s gear was wrong,” he said recently, after patrolling for shrimpers in the Mississippi Sound, a few days before floating islands of oil forced officials to close it. By gear, Lieutenant Armes meant turtles excluder devices, which shrimp trawlers are supposed to have. Without them, trawls can be one of the biggest dangers for turtles, which can get trapped in the nets and drown. The devices provide an escape hatch. Another kind of shrimp net, called a skimmer, is not required to have an excluder device — instead, the length of time the skimmers can be dragged is limited to give trapped turtles a chance to come up for air.

When shrimp season began in Mississippi on June 3, the marine patrol inspected all the boats and found no violations involving the excluders, Lieutenant Armes said. But on June 6, 12 dead turtles were found in Mississippi in a single day. Similar spikes have occurred when parts of Louisiana waters were opened to shrimpers, and since most of the waters in the spill area have closed, the turtle deaths have subsided.

Shrimpers emerged as a prime suspect in the NOAA investigation when, after a round of turtle necropsies in early May, Dr. Stacy announced that more than half the carcasses had sediment in the airways or lungs — evidence of drowning. The only plausible explanation for such a high number of drowning deaths, he said, was, as he put it, “fisheries interaction.”

Environmentalists saw the findings as confirmation of their suspicions that shrimpers, taking advantage of the fact that the Coast Guard and other inspectors were busy with the oil spill, had disabled their turtle excluder devices.

The devices are so contentious that Louisiana law has long forbidden its wildlife and fisheries agents to enforce federal regulations on the devices. Last month, Gov. Bobby Jindal vetoed legislation that would have finally lifted the ban, citing the “challenges and issues currently facing our fishermen.” By contrast, Mississippi officials strengthened turtle protections by decreasing the allowable tow time for skimmers, posting observers on boats, and sending out pamphlets on turtle resuscitation.

Officials in both states say that turtles die in shrimp season even when shrimpers follow the law, from boat strikes and other accidents. They also say there have been far fewer shrimpers working since the spill, in part because many have hired out their boats to BP. That should mean fewer, not more, turtle deaths.

But there has also been illegal activity. In Louisiana, agents have seized more than 20,000 pounds of shrimp and issued more than 350 citations to commercial fishermen working in waters closed because of the oil spill. In Mississippi in June, three skimmer boats were caught exceeding legal tow times -- one just hours after the shrimper had been given a handout explaining that the maximum time had been reduced, Lieutenant Armes said.

As for the piece of shrimp that Dr. Stacy found lodged in the turtle’s throat during the necropsy, it, too, pointed to shrimpers. A turtle is normally not quick enough to catch shrimp, Dr. Stacy said. Unless, of course, it is caught in a net with them.

Diagnosing Difficulties

In the necropsy lab in Gainesville, Dr. Stacy was slitting open the turtle’s delicate windpipe, looking for traces of sediment, a tell-tale sign of drowning. He finds none there, so he examines a crinkled papery membrane barely recognizable as lungs. Nothing.

“Drowning can be a difficult diagnosis,” he said. He has requested data that will show the level of commercial fishing in the area. But, he cautioned, “A lot of times our evidence is fairly indirect.”

In a sense, the necropsies so far have posed more questions than answers, demonstrating how oil has become just another variable in an already complex ecosystem. Late in June, a dolphin examined at the Institute for Marine Mammal Studies in Gulfport, Miss. showed signs of emaciation, but its belly was full of fish, suggesting that it may have gorged itself after a period of difficulty finding food.

Another dolphin, its ribs broken, was hit by a boat, a catastrophe that dolphins are normally nimble enough to avoid. The veterinarian, Dr. Connie Chevis, found a tar-like substance in the dolphin’s throat. The substance will be analyzed to see if it is oil, but one theory is that the animal could have been disoriented by oil exposure, which can have a narcotic effect, rendering it incapable of avoiding a boat strike. Ms. Deangelis said the dolphins on her recent tours have been “acting like they’ve had three martinis.”

The results raise questions about oil’s indirect effects. Is crude, for example, responsible for what anecdotal reports say is a steep increase in turtles in Mississippi and Louisiana waters? The population of Kemp’s ridleys has been rebounding thanks to years of protective measures. But some scientists have speculated the spill is driving wildlife toward the coast, crowding areas where there is more boat traffic and setting the stage for fatal accidents.

In a normal year, one or two turtles might get snagged on the hooks of recreational fishermen at the piers. Now, the institute in Gulfport is caring for 30 such turtles, a possible indication that they are desperate for food. In recent weeks, Dr. Chevis said, she has begun to see elevated white blood cell counts and signs of pneumonia in rescued turtles, both of which are symptoms of oil exposure, but could easily have other explanations.

In Gainesville, Dr. Stacy returned the jumbled remains of the turtle that ate the shrimp to its plastic wrapper and sent it back to the freezer. There, it will be stored indefinitely, just one piece of evidence among thousands.

    Animal Autopsies in Gulf Reveal Only a Mystery, NYT, 14.7.2010, http://www.nytimes.com/2010/07/15/science/earth/15necropsy.html

From a Gulf Oyster, a Domino Effect

July 13, 2010
The New York Times
By DAN BARRY

BAYOU GRAND CAILLOU, La.

In Gulf of Mexico waters deemed safe, at least for now, the two metal claws of a weather-beaten flatboat rake the muck below for those prehistoric chunks of desire, oysters. Then the captain and his two deckhands, their shirts flecked with the pewter mud of the sea, dump the dripping haul onto metal tables and begin the culling.

They hammer apart the clumps of attached oysters and toss back the empty shells and stray bits of Hurricane Katrina debris. They work quickly but carefully; a jagged oyster will slice your hand for not respecting its beautiful ugliness.

The men sweep their catch onto the boat’s floor, not far from a pile of burlap sacks. Their day will be measured by the number of full sacks their boat, the Miss Allison, carries to shore. Each 100-pound sack means $14 for the captain and $3 apiece for the deckhands.

The rocklike oyster and the burlap sack. As basic as it gets in the gulf, yet both are integral to a complex system of recycling and ingenuity, a system now threatened, along with most everything else, by the continuing oil-spill catastrophe in the gulf.

The disaster’s economic fallout has had a sneaky domino effect, touching the lives of everyone from the French Quarter shuckers who turn oyster-opening into theater to the Minnesota businessman who grinds the shells for chicken-feed supplement. Some victims were unaware that they were even tiles in the game, so removed were they from the damaged waters.

Take the burlap sacks on this oyster boat, for example, bearing the markings of Brazilian, Costa Rican and Mexican coffee companies. They come from a simple business, Steve’s Burlap Sacks, run out of a hot warehouse in Waveland, Miss., 120 miles away. And if you were to go there today, you would find the warehouse quiet, and the work-hardened owner trying very hard to keep it together.

“I don’t think the Lord’s looking this way no more,” he says.

Before a distant and fatal oil-rig explosion nearly three months ago, here is how the symbiotic sack-and-oyster system worked:

Coffee companies in Florida, Louisiana and Texas would unload the raw beans shipped from around the world, then sell their sacks in bulk to just about the only person who wanted them, a callused former oysterman from Louisiana named Steve Airhart.

Burlap sacks have long seemed almost divinely designed to hold oysters. Resilient, ventilated, able to handle the wet, and when past their use, they even burn well enough to keep the docks free of the pesky bugs called no-see-ums. But two decades ago, when Mr. Airhart was still raking for oysters, he could never find enough sacks.

After a friend’s relative helped him get some sacks from a large coffee importer, Mr. Airhart sensed opportunity. Within a year, he was harvesting sacks rather than oysters, sorting and stacking them in his driveway and then reselling them to oyster operations. From Bayou La Batre, Ala., to Galveston, Tex., he became known as the burlap-sack guy.

He had to start all over after Hurricane Katrina, living in a tent for several months while building a new warehouse in Waveland. But soon his employees were unloading truckloads of sacks, then laying the undamaged ones into a baler, 500 to a bale, each a ragged postcard from some faraway place.

“Produce of Indonesia.”

“Produce de Cote D’Ivoire.”

“Cafes do Brasil.”

Mr. Airhart’s six employees — Ben, Clyde, Jessica, Paula, Tommy and Tyler — would work from 7 a.m. until whenever, breathing in the fine coffee dust, sweeping up the stray green beans, taking in the smell that was like wet dog, earning $13 a bale. Then a trucker would deliver the baled sacks to Misho’s Oyster Company, in San Leon, Tex., or to Crystal Seas Seafood, in Pass Christian, Miss., or to Motivatit Seafoods, in Houma, La.

Motivatit is owned by two brothers, Mike and Steve Voisin, whose family has dedicated several generations to the pursuit of a living thing in a forbidding shell; a thing that poses a faint risk when consumed raw, yet evokes the wildness of the ocean.

“You’re getting a real bite of the sea,” Mike Voisin says.

Motivatit is one of the gulf’s dominant oyster operations. Before the spill, it managed 10,000 acres of oyster beds and processed 60,000 pounds of oysters a day. But to collect these craggy surprises of nature, the company hires boats like the Miss Allison.

Several times a week, the Miss Allison pulls away from a dock near a small place called Theriot, La., bound for where porpoises sometimes provide escort. Its captain, Santos Rodriguez, sun-baked and 44, has churned these waters for 26 years, long enough to wonder whether he’s raking up the same shells and bottles; long enough to measure a bag’s weight by hand rather than by scale.

And yes, the captain eats oysters. Using a short knife, he pops the seal of a just-harvested oyster with safecracker élan, makes a cut, and slurps the wild goop down.

But with the oil spill forcing the shutdown of oyster beds throughout the gulf — including about 60 percent of Motivatit’s acreage — he has never seen the catch so low. Yes, the price for a sack is up, but the total number of sacks is down. Normally, he and his crew will return to shore with about 60 sacks; now, a good day is 35.

His two muck-spattered deckhands, Luis Gomez, 24, and Cesar Badillo, 23, reflect the changed life, having recently moved to Houma after oyster beds elsewhere in Louisiana shut down. Mr. Gomez wears a cross around his neck, Mr. Badillo wears a burlap sack for an apron, and both wear gloves over their shell-scarred hands.

After a piece of machinery breaks, the Miss Allison turns around. By the time it reaches shore, to a dock paved with crushed oyster shells, the crew has 30 sacks filled and knotted — about $90 each for the deckhands, and about $420 for the captain, who has paid for the gas and food and must now fix the broken equipment.

Early the next morning, amid the din of the Motivatit plant in Houma, a stocky woman in a blue construction hat weighs these bags and others by hook. She then dumps their contents, which look like bits of construction debris, onto a conveyor belt to begin a process that involves tumblers, washers and dozens of employees. Wearing hairnets and aprons adorned with their first names and hand-drawn hearts, they shuck and shuck.

But because the oil spill has forced the shutdown of so many of Motivatit’s oyster beds — most of them out of precaution, some of them because of the presence of oil — these workers are processing about half the normal number of oysters. “With the lower amount of product, we’re having to cut most of the orders,” Mike Voisin says. “We’ve had to minimize.”

This means that Motivatit now employs about 80 workers, two dozen fewer than usual. The entire night shift has been suspended.

This means that the weekly deliveries to Los Angeles, by way of El Paso, Tucson and Phoenix, have stopped, as have the deliveries to Las Vegas, where clients prefer smaller oysters from beds that are now off limits.

This means that Warehouse Shell Sales, in Newport, Minn., may have to adjust. Several times a year, it has 1,500 tons of gulf oyster shells, including many from Motivatit, barged up the Mississippi River to be crushed and sold as poultry feed mix; chickens draw calcium from the oyster-shell bits sitting in their gizzards, hardening the shells of the eggs they produce.

But the oil spill has the shell company’s owner, Gary Lund, worried about supply. He says he is now exploring other options.

Finally, this means disaster for the burlap-sack guy, Steve Airhart.

Four months ago, his hot and dusty warehouse in Waveland was humming, with loose sacks coming in and baled sacks going out: 135,000 sold in March, 139,000 in April, and the busy summer season coming up. Then it stopped.

Mr. Airhart, 49, did what he could for a few weeks, but finally he had to lay off Paula, Jessica and the others. “One of the hardest days of my life,” he says. “But they knew it was coming. They heard me on the phone, begging to make sales.”

Now the warehouse is mostly empty, save for the few stacks of bales no one wants, and a boat that Mr. Airhart suddenly had the time to finish. He says that BP, the oil company responsible for the spill, has paid him $20,000 so far for lost business, but that is nowhere near enough to cover the $320,000, plus sweat equity, that he has invested in the company.

The former oysterman is looking forward to sliding this boat he’s built into the damaged waters. He wants to help clean up what has broken so many fragile systems.

    From a Gulf Oyster, a Domino Effect, NYT, 13.7.2010, http://www.nytimes.com/2010/07/16/us/16land.html

In BP’s Record, a History of Boldness and Costly Blunders

July 12, 2010
The New York Times
By SARAH LYALL

This article was reported by Sarah Lyall, Clifford Krauss and Jad Mouawad and written by Ms. Lyall.

Hurricane Dennis had already come and gone on July 11, 2005, when a passing ship spotted a shocking sight in the Gulf of Mexico: Thunder Horse, BP’s hulking $1 billion oil platform, was listing precariously to one side, looking for all the world as if it were about to sink.

Towering 15 stories above the water’s surface, Thunder Horse was meant to be the company’s crowning glory, the embodiment of its bold gamble to outpace its competitors in finding and exploiting the vast reserves of oil beneath the waters of the gulf.

Instead, the rig, which was supposed to produce about 20 percent of the gulf’s oil output, became a symbol of BP’s hubris. A valve installed backward had caused the vessel to flood during the hurricane, jeopardizing the project before any oil had even been pumped. Other problems, discovered later, included a welding job so shoddy that it left underwater pipelines brittle and full of cracks.

“It could have been catastrophic,” said Gordon A. Aaker Jr., a senior engineering consultant on the project. “You would have lost a lot of oil a mile down before you would have even known. It could have been a helluva spill — much like the Deepwater Horizon.”

The problems at Thunder Horse were not an anomaly, but a warning that BP was taking too many risks and cutting corners in pursuit of growth and profits, according to analysts, competitors and former employees. Despite a catalog of crises and near misses in recent years, BP has been chronically unable or unwilling to learn from its mistakes, an examination of its record shows.

“They were very arrogant and proud and in denial,” said Steve Arendt, a safety specialist who assisted the panel appointed by BP to investigate the company’s refineries after a deadly 2005 explosion at its Texas City, Tex., facility. “It is possible they were fooled by their success.”

Indeed, there was a great deal of success to admire. In little more than a decade, BP grew from a middleweight into the industry’s second-largest company, behind only Exxon Mobil, with soaring profits, fat dividends and a share price to match.

From its base in London, the company struck bold deals in politically volatile areas like Angola and Azerbaijan and pushed technology to the limit in the remotest reaches of Alaska and the deepest waters of the Gulf of Mexico — “the tough stuff that others cannot or choose not to do,” as its chief executive, Tony Hayward, once put it.

The company also led an industry wave of cost-cutting and consolidation. It took over American competitors like Amoco and Atlantic Richfield and eliminated tens of thousands of jobs in several rounds, streamlining management but forcing the company to rely more heavily on outside contractors.

For a long time, BP’s strategy seemed to pay off. But on April 20, the nightmare situation occurred: the Deepwater Horizon drilling rig exploded, killing 11 workers and sending millions of gallons of oil gushing from BP’s Macondo well like so much black poison.

Although the accident is still under investigation, preliminary findings by Congressional investigators indicate that BP made a series of decisions that compounded the chances of disaster.

BP declined to make Mr. Hayward or other executives available for this article. But in an interview last month, Robert Dudley, the BP board member now in charge of the gulf spill response, denied that the accident reflected a corporate disregard for safety.

“I think we will find that this was an incredibly complicated set of events with individual decisions and equipment failures that led to a very complicated industrial accident,” he said.

BP is hardly the only oil company that has taken on difficult projects with a shaky safety net. But the company’s attitude toward risk stands in contrast to that of its competitors, most notably Exxon Mobil, whose searing experience with the Exxon Valdez spill in 1989 spurred a wholesale change in its approach to safety.

“You can have the best intentions in the world, you can have the best equipment in the world, but it’s a combination of intentions, equipment and judgment that keeps accidents out of the workplace,” said Joseph H. Bryant, who ran BP’s operations in Angola from 2000 to 2004 and who is now chief executive of Cobalt International Energy. “If you are going to ask people to innovate, you’d better make sure that they know that any risks they take are manageable.”

A Focus on the Basics

When Tony Hayward became BP’s chief executive in May 2007, he promised to get the company back to basics.

One of his first moves was to remove the modern art adorning the company’s swanky London headquarters, including an endless video of gently waving corn projected onto one wall. In its place went prosaic photographs of BP service stations, platforms and pipelines.

A plain-spoken geologist and longtime company man, Mr. Hayward dispensed with the limousine used by his socially prominent predecessor, John Browne, and closed the concierge desk in the lobby that had helped employees with dry cleaning and theater tickets.

“BP makes its money by someone, somewhere, every day putting on boots, coveralls, a hard hat and glasses, and going out and turning valves,” Mr. Hayward said in a speech at Stanford Business School last year. “And we’d sort of lost track of that.”

Mr. Hayward also pledged to fix the safety problems that contributed to the downfall of his predecessor. Though the company would continue doing the “tough stuff,” he declared, it would make safety its “No. 1 priority.”

In the realm of personal safety, Mr. Hayward expanded on Mr. Browne’s initiatives. Visitors today see signs at company offices exhorting workers not to walk and carry hot coffee at the same time, to stick to marked walkways in parking lots and to grasp banisters while climbing the stairs. Employees with company cars must take defensive driving courses.

Mr. Hayward also set up a new companywide management system to evaluate risks, standardize safety practices and improve decision-making.

In a memorandum to employees on Friday, he noted that before Deepwater Horizon, the company’s safety record had been improving. “This accident has been a terrible exception to that trend and we must learn the lessons from it,” he wrote. “But at the same time, it does not invalidate all the hard work you have put in to improve our safety standards around the world. Safety is our first priority. It will remain so.”

But American regulators and some members of Congress say that despite such talk, the company continues its risky behavior.

“The way safety is measured is generally around worker injuries and days away from work, and that measure of safety is irrelevant when you are looking at the likelihood that a facility like an oil refinery could explode,” said David Michaels, assistant secretary of labor for occupational safety and health. “This is comparable to saying that an airline is safe because the pilots and mechanics haven’t been injured.”

A Story Begun in Persia

BP was born in 1908 when a rich Englishman named William Knox D’Arcy struck oil in Iran and formed the Anglo-Persian Oil Company. Treating the locals as little more than imperial subjects, the company, partly owned by the British government, expanded across the region, its fortunes intertwined with those of the British Empire.

But as oil-rich countries around the world began nationalizing their oil fields, British Petroleum, as it later became known, was forced to retreat and find new strategies along with the rest of the industry.

In 1995, the British government sold the last of its stake in the company and the charismatic Mr. Browne took over.

A highly visible supporter of the Royal Opera House, the National Gallery and Prime Minister Tony Blair, Mr. Browne transformed the company into a global behemoth, boldly acquiring properties around the world and rechristening it BP.

Unlike some of his more cautious competitors, Mr. Browne ignored small projects and went after the riskiest, most expensive and potentially most lucrative ventures — “elephants,” in industry jargon. Under him, BP’s share price more than doubled and its cash dividend tripled, making it a darling of investors.

But even as he became the toast of Britain’s business world and was made a knight and member of the House of Lords, Mr. Browne was ruthlessly slashing costs. He outsourced many operations and fired tens of thousands of employees, including many engineers.

Tom Kirchmaier, a lecturer in strategy at the Manchester Business School, said that Mr. Browne tried to run BP like a financial company, rotating managers into new jobs with tough profit targets and then moving them before they had to deal with the consequences. The troubled Texas City refinery, for example, had five managers in six years.

Mr. Browne, now advising Britain’s coalition government on its cost-cutting campaign, declined to comment for this article. In his new autobiography, “Beyond Business,” he said, “I transformed a company, challenged a sector, and prompted political and business leaders to change.”

Mr. Browne resigned under pressure in 2007, his reputation tarnished by a lie he told in court papers about his relationship with a male companion.

However, Mr. Browne’s fall from grace really began on March 23, 2005, when 15 people died and more than 170 were injured in America’s worst industrial accident in a generation: a huge fire and explosion at Texas City.

A Troubled Workplace

Acquired by BP in the Amoco purchase, the Texas City plant was America’s second-largest refinery, turning 460,000 barrels of crude oil a day into gasoline. But the facility, built in 1934, was poorly maintained and long starved of capital investment.

“We have never seen a site where the notion ‘I could die today’ was so real,” the Telos Group, a consulting firm hired to examine conditions at the plant, said in a report two months before the accident.

The explosion occurred when a 170-foot tower was being filled with liquid hydrocarbons. Because of poor communication among several workers who had been on 12-hour shifts for more than a month straight, no one noticed that the tower was filled too high.

A 20-foot geyser of unstable chemicals shot into the sky, and the vapor ignited when a contractor, trying to get away, repeatedly tried to start the engine on his stalling pickup truck.

The subsequent investigations were scathing. The explosion was “caused by organizational and safety deficiencies at all levels of BP,” the United States Chemical Safety Board concluded in one report.

The government ultimately found more than 300 safety violations, and BP agreed to pay a then record $21 million in fines.

A year later, there was a new calamity: 267,000 gallons of oil leaked from BP’s network of pipelines in Prudhoe Bay, Alaska.

It was the worst spill ever on the North Slope, and once again, the cause was preventable. Investigators found widespread corrosion in several miles of under-maintained and poorly inspected pipes. BP eventually paid more than $20 million in fines and restitution.

While these two accidents drew most public attention, serious problems were also brewing offshore, at BP’s Thunder Horse platform.

Mr. Aaker, the engineering consultant who worked on it, said BP’s bosses rushed construction of the intricately designed vessel, moving it to the gulf before it was ready to “demonstrate to their shareholders that the project was on time and on schedule.”

Once the rig was at sea, several hundred people at a time frantically worked to complete it, sleeping in cramped, chaotic conditions on board a temporary encampment of ships.

“It was like having the plumbers, the electricians and the bricklayers come to a construction site at the same time as they are laying the concrete,” said Mr. Aaker, who is now assisting the House Energy and Commerce Committee in its investigation of Deepwater Horizon. “This was not methodical.”

Nor was it safe.

The near sinking of Thunder Horse in 2005 was caused by a shockingly simple mistake: a check valve had been installed backward, and that caused water to flood into, rather than out of, the rig when it heated up during the hurricane.

After costly repairs to fix that damage, BP discovered a more significant problem: rudimentary mistakes in the welding of pipes in the underwater manifold, which connects dozens of wells and helps carry the oil back to the platform, had caused dangerous cracks and breaks.

Had the well been active, the damaged pipes would have caused a major oil spill. As it was, the company had to remotely rip out, retrieve and fix dozens of complex and heavy pieces of equipment lying on the sea floor, some weighing more than 400 tons.

Altogether, the blunders cost BP and its minority partner, Exxon Mobil, hundreds of millions of dollars in repairs and set back production, today at 300,000 barrels of oil and oil equivalents a day, by three years.

Although the Deepwater Horizon accident involved an exploration rig, not a production platform, a similar carelessness and disregard for safety was evident in BP’s decisions there, according to preliminary findings by the House Energy and Commerce Committee. “In effect, it appears that BP repeatedly chose risky procedures in order to reduce costs and save time and made minimal efforts to contain the added risk,” wrote Henry A. Waxman, the committee chairman, and Bart Stupak, chairman of its subcommittee on oversight and investigations.

BP took a different sort of risk in Russia, forming a 50-50 joint venture in 2003 with that nation’s unpredictable oligarchs to gain access to the vast resources beneath the Siberian taiga.

The deal, which accounted for about one-quarter of BP’s global oil reserves, nearly collapsed in 2008, when the Russian government sought tighter control over its energy sector. After a nasty public fight, BP was forced to hand over operational control of the venture to its Russian partners, although it continues to reap vast profits from it.

BP stepped into another tricky political situation last year, when Iraq offered foreign companies $2 a barrel to help it increase production from its oil fields, which had suffered from years of war and neglect. BP’s competitors blanched at the low price, but Mr. Hayward teamed up with a Chinese state-owned company and accepted the deal.

The chairman of a rival company was so enraged that he called Mr. Hayward and demanded: “Tony, have you gone mad?” BP’s move forced other companies to agree to similar terms. As one analyst noted, it was “disastrous to profitability” for the industry.

Old Habits Die Hard

Time and again, BP has insisted that it has learned how to balance risk and safety, efficiency and profit. Yet the evidence suggests that fundamental change has been elusive.

Revisiting Texas City in 2009, inspectors from the Occupational Safety and Health Administration found more than 700 safety violations and proposed a record fine of $87.4 million — topping the earlier record set by BP in the 2005 accident. Most of the penalties, the agency said, were because BP had failed to live up to the previous settlement fully.

In March of this year, OSHA found 62 violations at BP’s Ohio refinery, proposing $3 million more in penalties.

“Senior management told us they are very serious about safety, but we observed that they haven’t translated their words into safe working procedures and practices, and they have difficulty applying the lessons learned from refinery to refinery or even from within refineries,” said Mr. Michaels, the OSHA administrator.

BP is contesting OSHA’s allegations, saying it has made substantial improvements at both facilities.

Accidents have also continued to plague BP’s pipelines in Alaska. Most recently, on May 25, a power failure led to a leak that overwhelmed a storage tank and spilled about 200,000 gallons of oil — the third-largest spill on the Trans-Alaska Pipeline System.

Mr. Dudley, the BP executive overseeing the gulf response, said it was unfair to blame cultural failings at BP for the string of accidents.

“Everyone realized we had to operate safely and reliably, particularly in the U.S., to restore a reputation that was damaged by the accident at Texas City,” he said. “So I don’t accept, and have not witnessed, this cutting of corners and the sacrifice of safety to drive results.”

Mr. Waxman, whose committee is investigating the Deepwater Horizon accident, has a very different view. When Mr. Hayward testified a month ago, the representative upbraided him: “There is a complete contradiction between BP’s words and deeds. You were brought in to make safety the top priority of BP. But under your leadership, BP has taken the most extreme risks.”

“BP cut corner after corner to save a million dollars here and a few hours there,” Mr. Waxman said. “And now the whole Gulf Coast is paying the price.”

    In BP’s Record, a History of Boldness and Costly Blunders, NYT, 12.7.2010, http://www.nytimes.com/2010/07/13/business/energy-environment/13bprisk.html

Some Oil Spill Events From Sunday, July 11, 2010

July 11, 2010
Filed at 2:41 p.m. ET
The New York Times
By THE ASSOCIATED PRESS

A summary of events Sunday, July 11, Day 82 of the Gulf of Mexico oil spill that began with the April 20 explosion and fire on the drilling rig Deepwater Horizon, owned by Transocean Ltd. and leased by BP PLC, which is in charge of cleanup and containment. The blast killed 11 workers. Since then, oil has been pouring into the Gulf from a blown-out undersea well.

SPEWING OIL

Oil spewed largely unchecked once again into the Gulf of Mexico as BP crews worked to replace a leaky cap with a new containment system they hope will finally catch all the crude from the busted well. Robotic submarines removed the cap Saturday that had been placed on top of the leak in early June. BP says it's possible the new, tighter cap would be in place Monday, but it could take more time. On Sunday, officials said the work was going according to plan. BP hopes the capping operation will be done within three to six days.

NO GUARANTEES

There's no guarantee that such a delicate operation nearly a mile below the water's surface will go according to plan. ''It's not just going to be, you put the cap on, it's done. It's not like putting a cap on a tube of toothpaste,'' Coast Guard spokesman Capt. James McPherson said. And the hurricane season that lasts through November could interfere. There are no storms forecast now, but if one blows through, the ships collecting the oil may have to leave and crude would spew again for days into the water.

NEW CAP, NEW HOPE

If the new cap withstands the pressure of the oil, the Gulf region could get its most significant piece of good news since the explosion. But it would be only a temporary solution. Hope for permanently plugging the leak lies with two relief wells, the first of which should be finished by mid-August.

CONFIDENCE

Obama adviser David Axelrod says the administration is confident that BP's latest effort to contain the gushing oil will work. He acknowledged BP's engineers are in ''uncharted waters'' when it comes to dealing with the leak. Axelrod appeared on ''Fox News Sunday'' and ABC's ''This Week.''

SPEEDY OIL SPILL CLAIMS

The man in charge of providing compensation for victims of the Gulf oil spill says he's ready to give those eligible a full six months' worth of emergency payments on a single request. Ken Feinberg, who's administering the $20 billion fund established by BP, says that speeding up the claims process is part of the effort to help people feel an added degree of financial certainty. He was speaking on CNN's ''State of the Union.''

BP ASSETS

A British newspaper reported that BP is talking about possibly selling $18 billion worth of assets. The Sunday Times said Houston-based Apache Corp. was discussing the possibility of acquiring BP assets including a stake in the Prudhoe Bay field in Alaska. The newspaper did not cite a source for its report. The company refused comment. BP is thought to be considering some asset sales to raise cash to cover its oil spill liability. The company agreed to set aside some assets as security while it builds up a $20 billion damage compensation fund.

    Some Oil Spill Events From Sunday, July 11, 2010, NYT, 11.7.2010, http://www.nytimes.com/aponline/2010/07/11/us/AP-US-Gulf-Oil-Spill-Today.html

Obama Asks Court to Reinstate Ban on Deepwater Drilling

July 7, 2010
The New York Times
By JOHN M. BRODER

WASHINGTON — The Obama administration has asked a federal court in Louisiana to reinstate the ban on deepwater drilling in the Gulf of Mexico, saying the moratorium was a rational response to the unparalleled emergency of the BP oil spill.

In a court filing late Tuesday, the Interior Department said that the six-month ban on drilling in more than 500 feet of water, imposed in late May, was necessary to allow time to adopt stricter safety and environmental regulation of deepwater wells.

The action has put hundreds of people who operate and service deepwater wells out of work and has brought long-term uncertainty to the Gulf Coast economy. Politicians all along the coast have called the moratorium a case of federal overkill that threatens the livelihood of the region.

The moratorium was challenged in court by Hornbeck Offshore Services, a Louisiana firm that provides goods and services to offshore drilling and pumping platforms, and by other oil service firms. Judge Martin L. C. Feldman of the United States District Court in New Orleans agreed with the company, and on June 22 issued an order blocking enforcement of the moratorium. He said the Obama administration had failed to justify the need for “a blanket, generic, indeed punitive, moratorium” on deepwater oil and gas drilling.

The May moratorium order halted 33 exploratory drilling projects in deep water and suspended new permits but did not affect platforms that were already in production. Despite Judge Feldman’s ruling reversing the moratorium, work on the wells has not resumed pending appeals.

Interior Secretary Ken Salazar is expected to issue new guidelines for the drilling ban by the end of the week that may allow some deepwater drilling or well maintenance activity to start again, an agency official said Wednesday.

In replying on Tuesday to Judge Feldman’s order, the Interior Department, joined by the Justice Department, stated that the continued suspension of drilling was required because continued operations without new safety measures threatened irreparable harm to the marine and coastal environment across the gulf. The government also said that the BP oil spill had taxed the resources available to respond to and clean up the mess and that government and industry could not cope with a second blowout.

“Because this deepwater spill has been impossible to fully contain,” the government reply said, “Interior had to take immediate action to minimize the risk of another spill, especially while efforts to contain and clean up this one are ongoing. The stakes are even higher now that it is hurricane season.”

The Interior Department, which oversees oil and gas exploration on public lands and offshore, is charged with the “prudent and safe” management of those resources, the court filing said.

“A short-term suspension of deepwater drilling while safety regulations are updated is necessary to achieve that goal,” the document stated.

A three-judge panel of the United States Court of Appeals for the Fifth Circuit, in New Orleans, will hear arguments in the case on Thursday.

    Obama Asks Court to Reinstate Ban on Deepwater Drilling, NYT, 7.7.2010, http://www.nytimes.com/2010/07/08/us/08drill.html

BP Tries to Reassure Shareholders

July 7, 2010
The New York Times
By JAD MOUAWAD

For more than 10 weeks, BP has focused on the challenge of plugging its gushing oil well a mile below the surface of the Gulf of Mexico. It has also struggled to placate angry gulf residents and government officials and reassure a public frustrated by the company’s inability to stop the spill.

Now — as it appears BP might complete drilling its relief wells by late July or August — the company is beginning the equally difficult job of regaining the confidence of its stockholders and business partners.

In recent days, BP’s chief executive, Tony Hayward, whose leadership has been roundly criticized by some in the United States, has been busy talking to the company’s top shareholders to convince them that BP can pay for the spill without jeopardizing growth.

Mr. Hayward recently met with officials in Russia and Azerbaijan, and on Wednesday, he was in the United Arab Emirates to seek support from the region’s rich investors and reassure government officials that BP would continue to be a reliable partner.

The company has also begun to talk to potential buyers for the $10 billion of assets it intends to sell to help pay for the costs of the spill.

Although no deals or big investments have been announced, investors have begun crawling back into the battered stock. This week, BP’s American shares have risen 13 percent, although they are still down 45 percent since the April 20 explosion of the Deepwater Horizon rig.

“I think the company has turned a corner here,” said Thomas S. Hull, chief investment officer of Lowry Hill Investment Advisors, a Minnesota money manager, which has sold much of its BP stake. “What I’m hearing and seeing from BP now is they’re being more conservative in terms of their estimates of the size of the damage.”

Of course, many unknowns remain, including how much BP will ultimately have to pay out for the spill. So far, BP says, it has spent $3.12 billion on relief efforts and cleanup operations.

Analysts currently estimate BP’s total liability in the accident at $20 billion to $70 billion, an unusually wide range.

A continued drop in the price of oil could also hurt BP’s finances. Each $1-a-barrel drop in the price of oil cuts BP’s profits by $70 million. Oil prices in New York have lost $10 a barrel in the last two months, and now trade at $74 a barrel.

Still, the company’s prospects appeared to stabilize after top BP officials met with President Obama three weeks ago and agreed to establish a $20 billion escrow fund to pay claims, analysts said.

The deal defused tensions between the administration and the company. It also gave BP the chance to spread out costs related to the spill. BP is expected to make an initial payment of $3 billion in the third quarter of this year. Another payment, of $2 billion, will follow in the fourth quarter. The company will then pay $1.25 billion each quarter until the fund reaches $20 billion at the end of 2013.

The company continues to generate substantial cash flows, which it said would reach $30 billion this year. It discontinued its dividend this year, saving about $8 billion, and will reduce its capital spending by several billion dollars over the next year.

Meanwhile, BP, based in London, has lined up billions of dollars in new short-term credit lines from banks.

It also plans to sell $10 billion worth of nonstrategic assets within the next 12 months. One candidate for sale is BP’s 60 percent stake in an Argentine producer, Pan American Energy, which is valued at $9 billion.

“BP faces this from a position of strong assets, strong balance sheet, strong operating performance, strong cash flows, and is now poised to take the long journey of rebuilding confidence after this terrible accident,” said Andrew Gowers, a company spokesman.

The company plans to outline its new strategy and update investors on its financial health when it reports its second-quarter earnings on July 27.

“They are building up a cash treasure chest,” said Alex Morris, an analyst at Raymond James & Associates. “A company like BP has the cash flow and the assets to handle a hit like this once. Of course, the legal liability remains a huge uncertainty right now, but whatever it may be, proceedings will last for years.”

With energy demand set to expand over the next few decades, BP should have no trouble finding buyers for the assets it decides to sell, said Mr. Morris. “Foreign state-run companies, like the Chinese, are voraciously scooping out energy projects, so there are definitely buyers out there.”

Although BP has ruled out issuing additional shares to new investors, it is encouraging supporters to buy stock in the open market.

The head of Libya’s national oil company, Shokri Ghanem, praised the company this week, telling Bloomberg News that BP’s shares were undervalued and constituted a buying opportunity. BP is one of the largest foreign investors in Libya, where it has pledged to invest about $1 billion.

“With the relief wells appearing to be on track,” Neil McMahon, an analyst at Bernstein Research in London, wrote in a research note to clients, “we may finally be arriving at a point where things could start getting better, rather than worse, for BP.”


Susanna G. Kim contributed reporting.

    BP Tries to Reassure Shareholders, NYT, 7.7.2010, http://www.nytimes.com/2010/07/08/business/global/08bp.html

Louisiana and Scientists Spar Over How to Stop Oil

July 6, 2010
The New York Times
By JOHN COLLINS RUDOLF

With oil hitting Barataria Bay, a vast estuary in southeast Louisiana that boasts one of the most productive fisheries in the country, local parish officials hatched a plan in May to save the fragile ecosystem: they would build rock dikes across several major tidal inlets between the bay and the Gulf of Mexico to block and then capture the oil.

Gov. Bobby Jindal of Louisiana supported the plan, and BP agreed to pay for the project, estimated to cost $30 million. By early June, about 100,000 tons of rock began being loaded onto barges on the Mississippi River for transport to the coast.

But over the weekend, the Army Corps of Engineers denied a permit for the project, citing environmental concerns, in particular the potential for the rock barriers to cause widespread erosion and the breaching of Barataria Bay’s existing barrier islands. The ruling echoed the sentiments of independent experts on coastal wetlands who had strongly objected to the plan.

Now the rock sits on 75 barges on the Mississippi River with no immediate use.

As the gulf oil spill enters its third month, Louisiana officials have grown increasingly enamored of large-scale engineering projects, like sand berms and rock walls, to keep the oil off their coast. But these projects, which demand the swift restructuring of eastern Louisiana’s dynamic and fragile coast, have brought the desires of state and local officials into sharp conflict not only with a complicated federal bureaucracy charged with protecting wetlands and estuaries, but also with an experienced and highly vocal community of local coastal scientists.

“They’re just sitting back criticizing,” said Deano Bonano, the emergency-preparedness director for Jefferson Parish, which borders Barataria Bay. “Where are they when it comes to protecting this bay?”

In a speech on Tuesday in New Orleans, Mr. Jindal said: “No one can convince us that rocks in the water are more dangerous than oil. That is absolutely ridiculous. The only people who believe that are the bureaucrats in Washington, D.C., who can’t see the oil, smell the oil or touch the oil."

The scientists insist the rock plan was misguided.

“There was very strong scientific backing for not doing this,” said Denise Reed, a wetlands specialist and director of the Pontchartrain Institute for Environmental Sciences in New Orleans. “This could really devastate our barrier shoreline, our first line of defense.”

For decades, the independent experts have worked hand-in-hand with the state and the federal government to save and restore Louisiana’s wetlands, which have lostroughly 1.2 million of acres to erosion since the 1930s and continue to disappear at the rate of 25 square miles every year.

It was these experts, along with their scientific peers in federal agencies like the National Oceanic and Atmospheric Administration and the Environmental Protection Agency, who offered the strongest opposition to the proposed rock barrier. Many of those critiques were included in supporting documents released by the Army Corps of Engineers before the official ruling was announced.

The scientists explained to the corps how narrowing the inlets with rock would set the stage for the breaching of existing barrier islands during the region’s frequent storms. They warned that damage to these islands — which have buffered the impact of major storms like Hurricane Katrina — would prove difficult to repair, perhaps impossible, and would most likely outstrip any benefit to the wetlands gained by stopping the oil with the rock barriers.

Having raised their voices in objection, these coastal experts now bristle at the accusation that they are out-of-touch academics or pencil-pushing bureaucrats, as state and local officials have charged.

“It’s really offensive, I think, and not fair, to call the scientific community bureaucrats,” said Dr. Ioannis Y. Georgiu, a professor of marine engineering at the University of New Orleans. “We are being demonized.”

Yet by siding with federal agencies blamed from the beginning of the spill for a slow-footed and chaotic response — and for which resentment still lingers over the failings of the federal response to Hurricane Katrina — these coastal scientists have made themselves easy targets for leaders eager to portray themselves as stopping at nothing in the fight against the oil. For these politicians, swifter action is crucial.

“You don’t wait weeks and weeks for studies and federal permits in the middle of a war,” Mr. Jindal, a Republican, said in a speech on July 2. “You do what you need to do as quickly as possible to protect your land and your people.”

The local scientists argue that quick-fix solutions are being sold to the public with little firm evidence that they will succeed, and with potentially dire side effects being minimized and ignored. A lack of engagement of the scientific community has also bred frustration. On the rock barrier plan, for instance, coastal experts were consulted only after a local engineering firm had drafted the permit application and orders had been placed for thousands of tons of rock to dump in the inlets.

“We’ve got such a coastal brain trust here, and they’re being left out in the cold,” said Dr. Len Bahr, a coastal scientist and former director of the Louisiana Office of Coastal Activities. “To me that’s just unconscionable.”

Some coastal experts concede that the scientific community has been more reactive than proactive regarding the spill, and has often waited to be consulted on solutions rather than offering up its own innovative ideas to keep oil off the coast, a criticism that local officials have echoed.

“We want to prevent the damage — we don’t want to clean it up,” Mr. Bonano, the emergency-preparedness director, said. “That’s the big difference between us and them.”

As charges fly back and forth, the prospect for a détente between the federal government and the coastal science community on the one hand and state and local officials on the other remains cloudy at best. Even with the rock plan soundly rejected by the Army Corps of Engineers, officials in Louisiana, from the governor’s office down, continue to argue that the plan to build the rock dikes was scientifically sound, and vow to carry on their fight to see it carried out.

Mr. Jindal said in a statement Tuesday that officials would resubmit the plan.

“We’ve made countless revisions,” said Garret Graves, the director of the governor’s Office of Coastal Activities. “We jumped through all these hoops to address their concerns, only to wait a month and be rejected.”

Mr. Jindal’s office has also said the governor will keep pressing for the rock barrier.

Coastal scientists, for their part, say they are ready to start investigating other options for stopping the movement of oil into the bay.

“I just wish the energy would go into looking for alternatives, not into just banging on the table,” Dr. Reed, of the Pontchartrain Institute, said. “Laying rock across passes is not the only way to stop the oil from getting into the marshes.”

    Louisiana and Scientists Spar Over How to Stop Oil, NYT, 6.7.2010, http://www.nytimes.com/2010/07/07/science/earth/07rocks.html

Agency Agreed That Spill Risk to Wildlife Was ‘Low’

July 5, 2010
The New York Times
By LESLIE KAUFMAN

The federal agency charged with protecting endangered species like the brown pelican and the Kemp’s ridley sea turtle signed off on the Minerals Management Service’s conclusion that deepwater drilling for oil in the Gulf of Mexico posed no significant risk to wildlife, despite evidence that a spill of even moderate size could be disastrous, according to federal documents.

By law, the minerals service, before selling oil leases in the gulf, must submit an evaluation of the potential biological impact on threatened species to the Fish and Wildlife Service, whose responsibilities include protecting endangered species on land. Although the wildlife agency cannot block lease sales, it can ask for changes in the assessment if it believes it is inadequate, or it can insist on conducting its own survey of potential threats, something the agency has frequently done in the past.

But in a letter dated Sept. 14, 2007, and obtained by The New York Times, the wildlife agency agreed with the minerals service’s characterization that the chances that deepwater drilling would result in a spill that would pollute critical habitat was “low.”

The agency signed off on the minerals service’s biological evaluation, even though that assessment considered only the risks to wildlife based on spills of 1,000 to 15,000 barrels — a minuscule amount compared with the hundreds of thousands of barrels now spewing into the gulf. The assessment also noted that even such modest spills carried up to a 27 percent risk of oil reaching the critical habitat for some endangered species.

Much of the first wave of criticism over the federal government’s part in the Deepwater Horizon disaster has focused on the dual role of the Minerals Management Service (renamed the Bureau of Ocean Energy Management, Regulation and Enforcement last month), which was responsible for both promoting offshore drilling through the sale of leases and for policing it. But environmental groups were also critical of other federal agencies that have watchdog roles and could have exercised their authority to protect the species.

“The Endangered Species Act requires caution, but federal wildlife agencies allowed offshore oil drilling to play Russian roulette with endangered species in the gulf,” said Daniel J. Rohlf, the clinical director of the Pacific Environmental Advocacy Center at Lewis & Clark Law School.

“Would people get on a plane if they knew it had a one in four chance of a major mechanical problem?” Mr. Rohlf asked, adding, “Federal wildlife agencies made conscious choices — under the guise of science — to allow offshore oil drilling with an identical risk of serious harm to endangered species.”

Deborah Fuller, the endangered species program coordinator for the Fish and Wildlife Service’s office in Lafayette, La., led the team that reviewed the minerals service’s biological assessment. She said that her office recognized that a big spill would be disastrous to wildlife and that it made suggestions for increasing preparedness for the cleanup of a spill as part of an informal consultation on the biological review.

But she said her office did not challenge the minerals service’s assessment of the risk.

“We all know an oil spill is catastrophic, but what is the likelihood it will happen?” Ms. Fuller asked. She said her office had considered that any likelihood under 50 percent would not be enough to require the protections of her office.

“Obviously, we are going to relook at all these numbers for upcoming consultations,” she said.

In considering earlier plans by the minerals service to sell oil leases in the gulf, the Fish and Wildlife Service had decided to conduct its own biological assessment, using its own scientists. But in 2007, the Louisiana office chose to write only an informal letter of concurrence with the minerals service’s assessment, the agency’s lowest level of review. While the wildlife agency could not stop a lease sale, formally disagreeing with an assessment by the minerals service could deter buyers worried about possible litigation by environmental groups.

In its 71-page biological assessment, the Minerals Management Service concluded that the chances of oil from a spill larger than 1,000 barrels reaching critical habitat within 10 days could be more than 1 in 4 for the piping plover and the bald eagle, as high as 1 in 6 for the brown pelican and almost 1 in 10 for the Kemp’s ridley sea turtle. When the model was extended to 30 days, the assessment predicted even higher likelihoods of habitat pollution.

The report described in detail the severe consequences for a variety of species if they were to be affected by oil.

“Heavily oiled birds are likely to be killed,” the assessment said, adding that if the birds did not die, they might suffer from pneumonia or infection.

Stacy Small, a scientist with the Environmental Defense Fund, reviewed the biological assessment prepared by the minerals service and the letter in which the wildlife service concurred with the evaluation. “The wildlife risk models apparently weren’t based on large oil volumes and didn’t estimate risk for a worst case, or even really bad case, oil disaster scenario,” she said.

“If they had looked at a 30-day time span for oil reaching shore, the risk would probably have looked a lot higher and maybe triggered a more stringent review under the Endangered Species Act,” Dr. Small said. “Unfortunately, it doesn’t look like anyone at the agencies asked for that.”

    Agency Agreed That Spill Risk to Wildlife Was ‘Low’, 5.7.2010, http://www.nytimes.com/2010/07/06/us/06wildlife.html

BP Wants Partners to Help Shoulder Spill Cost

July 4, 2010
The New York Times
By JOHN SCHWARTZ

BP has said repeatedly that it will pay for the disastrous oil spill in the Gulf of Mexico. But its actions show that it does not intend to go it alone.

Newly released documents show that on June 2, BP sent out demands for nearly $400 million to its partners in the well, Anadarko Petroleum Corp. and Mitsui Oil Exploration Company of Japan, or roughly 40 percent of the $1 billion it had spent in May.

The amounts demanded by BP — $272 million from Anadarko and $111 million from Mitsui — reflect the provisions of each company’s joint operating agreement with BP, which gives a share of liability equal to each company’s share of ownership.

BP owns 65 percent of the well, Anadarko owns 25 percent and Mitsui 10 percent.

The total bill includes costs of drilling the relief wells, responding to the spill, and the reimbursements already sent to the federal government, as well as the claims that BP has already paid out in claims for economic loss to people along the Gulf Coast.

BP has handed also out $25 million checks to several gulf states for various costs, but did not attempt to pass a share of those expenditures on to its partners.

Toby Odone, a spokesman for BP, said, “We would expect the various parties involved in this to live up to their responsibilities.”

The other companies are not so sure. Anadarko has suggested that BP has engaged in “gross negligence” and “willful misconduct” — terms that, if proved in arbitration or court, could allow it to slip the bonds of liability under its joint operating agreement with the oil giant. A spokesman for the company, John Christiansen, said that he would not comment beyond the company’s previous statement, but added, “we are still assessing our contractual remedies.”

Mitsui has not struck as belligerent a pose. In a statement, the company said it was too early to draw conclusions about what happened on the rig, but “as a ten percent minority non-operating investor, MOEX Offshore 2007 is fully cooperating with those investigations.” The company added, “because we do not have the expertise required to fully evaluate the possible causes of the accident, we have decided to retain our own outside engineering experts to advise us on the matter.”

BP has demanded payment “30 days upon receipt,” or as early as Friday. When asked whether Anadarko had mailed a check, Mr. Christiansen, the Anadarko spokesman, reiterated, “we are continuing to assess our contractual remedies.” A Mitsui spokesman said that the company had until the 12th to pay, but did not say whether the company would be doing so.

The invoices were released by the Senate Subcommittee on Federal Financial Management, Government Information, Federal Services, and International Security. They were first described by the website TPMMuckraker.com. The fact that BP was reaching out to its partners for payment was first revealed by Dow Jones Newswires in mid June, but the amounts were not disclosed.

The chairman of the federal financial management subcommittee, Senator Tom Carper of Delaware, said, “We need to make sure that the taxpayer is not left on the hook for the damages associated with this disaster.” Mr. Carper, who is a Democrat, said that the subcommittee “is focused on getting to the bottom of who owes who and what so that the communities and businesses hurt by this disaster are made whole and that the taxpayers are protected.”

A Senate staffer said that it was unclear whether from the documents whether BP was expecting the companies to pay or was simply establishing its position for later battles in arbitration or court, saying “We can’t characterize BP’s intent.” However, the staffer said, “from our perspective, it does look like a real bill” — and “we want to know when these parties are going to pay, and if they don’t, why they feel they shouldn’t.”

The subcommittee has invited the chief executives of Anadarko and Mitsui Oil Exploration to testify.

The subcommittee also released a May 27 “bill for U.S. Government costs” for $1.8 billion from the Coast Guard’s National Pollution Funds Center. The government sent that bill not just to BP, but also to its partners and to Transocean Holdings, the owner of the Deepwater Horizon rig and its insurer, Lloyds Syndicate, stating that under the Oil Pollution Act, “responsible parties and guarantors are jointly and severally liable for the costs incurred.”

    BP Wants Partners to Help Shoulder Spill Cost, NYT, 4.7.2010, http://www.nytimes.com/2010/07/05/us/05liability.html

As Oil Industry Fights a Tax, It Reaps Billions From Subsidies

July 3, 2010
The New York Times
By DAVID KOCIENIEWSKI

When the Deepwater Horizon drilling platform set off the worst oil spill at sea in American history, it was flying the flag of the Marshall Islands. Registering there allowed the rig’s owner to significantly reduce its American taxes.

The owner, Transocean, moved its corporate headquarters from Houston to the Cayman Islands in 1999 and then to Switzerland in 2008, maneuvers that also helped it avoid taxes.

At the same time, BP was reaping sizable tax benefits from leasing the rig. According to a letter sent in June to the Senate Finance Committee, the company used a tax break for the oil industry to write off 70 percent of the rent for Deepwater Horizon — a deduction of more than $225,000 a day since the lease began.

With federal officials now considering a new tax on petroleum production to pay for the cleanup, the industry is fighting the measure, warning that it will lead to job losses and higher gasoline prices, as well as an increased dependence on foreign oil.

But an examination of the American tax code indicates that oil production is among the most heavily subsidized businesses, with tax breaks available at virtually every stage of the exploration and extraction process.

According to the most recent study by the Congressional Budget Office, released in 2005, capital investments like oil field leases and drilling equipment are taxed at an effective rate of 9 percent, significantly lower than the overall rate of 25 percent for businesses in general and lower than virtually any other industry.

And for many small and midsize oil companies, the tax on capital investments is so low that it is more than eliminated by var-ious credits. These companies’ returns on those investments are often higher after taxes than before.

“The flow of revenues to oil companies is like the gusher at the bottom of the Gulf of Mexico: heavy and constant,” said Senator Robert Menendez, Democrat of New Jersey, who has worked alongside the Obama administration on a bill that would cut $20 billion in oil industry tax breaks over the next decade. “There is no reason for these corporations to shortchange the American taxpayer.”

Oil industry officials say that the tax breaks, which average about $4 billion a year according to various government reports, are a bargain for taxpayers. By helping producers weather market fluctuations and invest in technology, tax incentives are supporting an industry that the officials say provides 9.2 million jobs.

The American Petroleum Institute, an industry advocacy group, argues that even with subsidies, oil producers paid or incurred $280 billion in American income taxes from 2006 to 2008, and pay a higher percentage of their earnings in taxes than most other American corporations.

As oil continues to spread across the Gulf of Mexico, however, the industry is being forced to defend tax breaks that some say are being abused or are outdated.

The Senate Finance Committee on Wednesday announced that it was investigating whether Transocean had exploited tax laws by moving overseas to avoid paying taxes in the United States. Efforts to curtail the tax breaks are likely to face fierce opposition in Congress; the oil and natural gas industry has spent $340 million on lobbyists since 2008, according to the nonpartisan Center for Responsive Politics, which monitors political spending.

Jack N. Gerard, president of the American Petroleum Institute, warns that any cut in subsidies will cost jobs.

“These companies evaluate costs, risks and opportunities across the globe,” he said. “So if the U.S. makes changes in the tax code that discourage drilling in gulf waters, they will go elsewhere and take their jobs with them.”

But some government watchdog groups say that only the industry’s political muscle is preserving the tax breaks. An economist for the Treasury Department said in 2009 that a study had found that oil prices and potential profits were so high that eliminating the subsidies would decrease American output by less than half of one percent.

“We’re giving tax breaks to highly profitable companies to do what they would be doing anyway,” said Sima J. Gandhi, a policy analyst at the Center for American Progress, a liberal research organization. “That’s not an incentive; that’s a giveaway.”

Some of the tax breaks date back nearly a century, when they were intended to encourage exploration in an era of rudimentary technology, when costly investments frequently produced only dry holes. Because of one lingering provision from the Tariff Act of 1913, many small and midsize oil companies based in the United States can claim deductions for the lost value of tapped oil fields far beyond the amount the companies actually paid for the oil rights.

Other tax breaks were born of international politics. In an attempt to deter Soviet influence in the Middle East in the 1950s, the State Department backed a Saudi Arabian accounting maneuver that reclassified the royalties charged by foreign governments to American oil drillers. Saudi Arabia and others began to treat some of the royalties as taxes, which entitled the companies to subtract those payments from their American tax bills. Despite repeated attempts to forbid this accounting practice, companies continue to deduct the payments. The Treasury Department estimates that it will cost $8.2 billion over the next decade.

Over the last 10 years, oil companies have also been aggressive in using foreign tax havens. Many rigs, like Deepwater Horizon, are registered in Panama or in the Marshall Islands, where they are subject to lower taxes and less stringent safety and staff regulations. American producers have also aggressively exploited the tax code by opening small offices in low-tax countries. A recent study by Martin A. Sullivan, an economist for the trade publication Tax Analysts, found that the five oil drilling companies that had undergone these “corporate inversions” had saved themselves a total of $4 billion in taxes since 1999.

Transocean — which has approximately 18,000 employees worldwide, including 1,300 in Houston and about a dozen in Zug, Switzerland — has saved $1.8 billion in taxes since moving overseas in 1999, the study found.

Transocean said it had paid more than $300 million in taxes so far for 2009, and that its move reflected its global scope, with only 15 of its 139 rigs located in the United States. “Transocean is truly a global company,” it said in a statement.

Despite the public anger at the gulf spill, it is far from certain that Congress will eliminate the tax breaks. As recently as 2005, when windfall profits for energy companies prompted even President George W. Bush — a former Texas oilman himself — to publicly call for an end to incentives, the energy bill he and Congress enacted still included $2.6 billion in oil subsidies. In 2007, after Democrats took control of Congress, a move to end the tax breaks failed.

Mr. Menendez said he believed the Gulf spill was devastating enough to spur Congress into action. But one notable omission in his bill shows the vast economic reach of the industry. While the legislation would cut many incentives over the next decade, it would not touch the tax breaks for oil refineries, many of which have operations and employees in his home state, New Jersey.

Mr. Menendez’s aides said the senator thought it was legitimate to allow refineries to continue claiming a manufacturing tax credit that he wants to eliminate for drillers because refining is a manufacturing business and because refineries do not benefit from high oil prices. Mr. Menendez did not consult with New Jersey refineries when writing the bill, his aides said.

    As Oil Industry Fights a Tax, It Reaps Billions From Subsidies, NYT, 3.7.2010, http://www.nytimes.com/2010/07/04/business/04bptax.html

Obama Gives $2 Billion to Solar Plants

July 3, 2010
Filed at 9:06 a.m. ET
The New York Times
By THE ASSOCIATED PRESS

WASHINGTON (AP) -- The government is handing out nearly $2 billion for new solar plants that President Barack Obama says will create thousands of jobs and increase the use of renewable energy sources.

Obama announced the initiative in his weekly radio and online address Saturday, saying the money is part of his plan to bring new industries to the U.S.

''We're going to keep competing aggressively to make sure the jobs and industries of the future are taking root right here in America,'' Obama said.

The two companies that will receive the money from the president's $862 billion economic stimulus are Abengoa Solar, which will build one of the world's largest solar plants in Arizona, creating 1,600 construction jobs; and Abound Solar Manufacturing, which is building plants in Colorado and Indiana. The Obama administration says those projects will create more than 2,000 construction jobs and 1,500 permanent jobs.

Obama's announcement came a day after the Labor Department reported that employers slashed payrolls last month for the first time in six months, driven by the expected end of 225,000 temporary census jobs. Meanwhile, private-sector hiring rose by 83,000 workers.

The unemployment rate dropped to 9.5 percent.

Obama said that while it may take years to bring back all the jobs lost during the recession, the economy is moving in a positive direction. He placed some of the blame for the slow pace of recovery on Republicans, saying GOP lawmakers, ''are playing the same old Washington games and using their power to hold this relief hostage.''

Obama has said that to bring the nation's economy back from the brink of a depression, it was necessary to add to the country's debt in the short term.

Republicans have tried to capitalize on that growing sum. Georgia Sen. Saxby Chambliss said in the Republican's weekly address that the country's $13 trillion debt is a national security issue that will leave the U.S. vulnerable and force future generations to ''pay higher taxes to foot the bill for Democrats' out-of-control spending.''

------

Online:

Abengoa Solar: http://www.abengoasolar.com 

Abound Solar Manufacturing: http://abound.com/ 

White House: http://www.whitehouse.gov/

    Obama Gives $2 Billion to Solar Plants, NYT, 3.7.2010, http://www.nytimes.com/aponline/2010/07/03/us/politics/AP-US-Obama-Jobs.html

Where BP’s Money Is Landing

July 2, 2010
The New York Times
By AMY SCHOENFELD

AS the Gulf of Mexico continues to fill with oil this summer, condos and restaurants will sit empty, fishing boats will stay docked, and beaches — even those without a single tar ball — will attract fewer tourists.

Economists estimate that more than seven million businesses will suffer from both the spill and the tarnished reputation it has brought to the region.

BP has now begun reimbursing businesses that rely on the gulf for their revenue. Since May, it has paid just under a third of the more than 90,000 claims it has received, with the checks totaling more than $144 million.

About 80 percent of the payments have gone to self-employed workers — including shrimpers, charter boat captains and beachfront condo owners — who can clearly show that the spill has affected their ability to make a profit. Fewer large businesses have been compensated because their claims are more complex and take longer to process.

So far, payments have been fairly small, averaging about $2,500 a month for a deckhand or $5,000 for a fisherman. BP estimates that about 13,000 people are receiving prepayments, often 30 days in advance.

The total bill is sure to grow exponentially, with more than 2,000 applications coming in each day. After negotiations with President Obama last month, BP promised to set aside $20 billion to continue to pay business claims and handle requests from local governments to cover cleanup and administrative costs.

The company has also set aside $100 million to assist oil rig workers who cannot find work because of the moratorium on drilling in the gulf.

Even so, federal, state and local officials say the payments from BP have fallen short. Checks have been too small, and the company has not disbursed money quickly enough to workers who are desperate to pay bills, critics say. Lawmakers say they are also concerned that the system of tracking claims has not been transparent.

BP says it is doing the best it can to keep up with the sheer volume of claims, which it says it could not have anticipated when it wrote the first check on May 3.

“I’m not sure anybody in this kind of situation meets all expectations, but we’re trying,” said Patricia Wright, a BP spokeswoman. Lawmakers say they are optimistic that improvements will come in August, when Kenneth R. Feinberg, the lawyer known for handling compensation claims for Sept. 11 victims, takes over BP’s claims system.

Mr. Feinberg, who was selected by the Obama administration and BP and will be paid by BP, will work closely with a team already contracted by the oil company. The group consists of some 950 claims adjusters in 35 offices across the region.

One of Mr. Feinberg’s biggest challenges is to determine whether people requesting compensation for indirect effects of the spill will be eligible.

At a Congressional hearing last week, Representative Lynn A. Westmoreland, a Georgia Republican, asked Mr. Feinberg how he would compensate homeowners for depressed real estate values along the gulf’s shores.

“On the one hand, those people are suffering; they deserve some help,” Mr. Feinberg responded. “On the other hand, there’s not enough money in the world to pay every homeowner wherever they live on the Gulf Coast who says my property is down because of the oil spill.”

While Mr. Feinberg has acknowledged that many questions remain about the claims system, he has publicly promised officials that he will provide more transparency and speed up payments. He also wants to provide larger emergency checks — such as a six-month lump sum instead of a single month’s pay.

Eventually, Mr. Feinberg says, he plans to write much larger checks to businesses, once his team is able to calculate the total loss an eligible claimant has faced.

But as long as the oil keeps flowing into the gulf, officials say that there is no way to know how much money businesses will lose or how much financial assistance will ultimately be needed.

“It sure would help if the oil would stop,” Mr. Feinberg said.

    Where BP’s Money Is Landing, NYT, 2.7.2010, http://www.nytimes.com/2010/07/04/business/04metricstext.html

In a Refuge Haunted by Katrina, BP Swirls In

July 2, 2010
The New York Times
By DAN BARRY

ARABI, La.

There stands a building on Aycock Street through which the recent troubles of St. Bernard Parish continue to flow. All the grief and all the hope and all the miseries borne by water run through this unassuming rectangle of window and brick.

The two-story structure was once a parochial school, and the touchstone for a neighborhood boy, long ago. Then Hurricane Katrina filled it halfway with water. Then it became a time-frozen reflection of the surrounding emptiness. Then it became Camp Hope, where volunteers spent their nights after working to restore pockets of St. Bernard, as much as could be done with lawnmowers and drywall.

Now the building has a new purpose. BP, the energy behemoth, is spending an estimated $600,000 to renovate it into a carpeted, air-conditioned dormitory where more than 300 workers can sleep after long days of helping to clean up BP’s catastrophic oil spill in the Gulf of Mexico — a spill that has tainted the waters of this coastal parish, still grappling with its last calamity.

As a result, an air of premature transference has filled the building on Aycock Street. In its cafeteria, BP-hired construction workers have been eating lunch beside Hurricane Katrina volunteers. Then the BP workers have gone back to their renovations, while the volunteers have returned to toil in vacated, damaged houses, often just down the street.

All the while, a heavyset white-haired man with bad knees has taken in the awkwardness unfolding on the terrazzo floors. His name is Mark Madary, and he has many titles and functions: acting director of Camp Hope; real estate investor; former councilman; champion of the community; graduate of this parochial school; child of Arabi.

Mr. Madary, 58, can look across the cafeteria and remember his grammar school crushes, and he can look across the street and imagine the houses that once stood on those grassy lots. Now here comes BP to renovate his old school, motivated more by guilt and necessity than by charity, but promising to leave behind an asset to the community.

“I have mixed feelings,” says Mr. Madary, whose eyes well if he lingers too long on certain subjects. “I am a realist when it comes to the damage. I am living proof that anything floats.”

Mr. Madary was a young boy when he first walked into this building. Back then it was the brand-new parochial school for St. John Vianney Roman Catholic Church in Arabi, a community on the eastern banks of the Mississippi River that was shedding its colorful past as a slaughterhouse center and gambling town.

He remembers when the church and school were renamed St. Louise de Marillac. He remembers every teacher, from Miss Chastant to Sister Angelina. He remembers the girls he admired from afar, Ramona and Thais. On that cafeteria stage, he sang “You Are My Sunshine.” Down those steps, he carried a girl who was having an epileptic seizure, while a nun followed behind, warning him not to drop her.

He remembers Hurricane Betsy in 1965, when hundreds of people were rescued from the roof of this building by boat and helicopter. Most of all, he remembers the vibrancy of the neighborhood. “A glut of people, of first-time homeowners,” he says. “Your playgrounds and schools were bursting at the time.”

Mr. Madary grew up, ran restaurants, bought and sold property, and became a councilman in St. Bernard Parish, just in time for the 2005 hurricane and flood that spared only five of the parish’s 27,000 homes. Arabi was all but destroyed; if you look up in the corner of the building’s cafeteria, maybe 14 feet up, you will see the flood line.

Like so many people here, he has nightmarish stories of the hurricane and its aftermath, stories made no less horrifying by their familiarity: from praying on a rooftop as the waters rose to seeing the fear in the eyes of the old and infirm as they were evacuated to who knows where. His voice trembles in the telling, nearly five years later.

And, like so many people here in St. Bernard — which has about two-thirds of its pre-Katrina population of 66,000 — Mr. Madary has dedicated himself to rebuilding his neighborhood. Since losing a race for state representative, he has bought, rehabilitated and sold several buildings in Arabi, and is working on another.

Still, the sense of absence pervades. The Archdiocese of New Orleans canonically closed St. Louise de Marillac Church two years ago, then tore it down last year, along with a portion of the old parochial school. Sarah McDonald, a spokeswoman for the archdiocese, says that after the hurricane, “there were not enough people to support the parish.”

The archdiocese eventually leased this remaining building to St. Bernard Parish, which opened it in January as a volunteer base called Camp Hope 3, the successor to two other facilities that sheltered volunteers who came to the region to help rebuild. Since it opened, more than 3,000 volunteers from colleges, church groups and nonprofit organizations have paid $25 a day for the privilege of eating and sleeping in an old school building with spare amenities.

Two months ago, Mr. Madary assumed the unpaid position of interim camp director, and he has slept some nights in a glorified storage room next to the old custodian’s office. He becomes emotional when talking of the sacrifices made by these visitors, the young and the not-so, who will be housed in a local motel while BP is in town. He points to ceiling tiles in the cafeteria that some volunteer groups have painted to commemorate their time together. “HOODAT!” one reads, from a group of University of Virginia students. “Katie, Rachel, Kevin, Derek....”

Now, beneath the artwork of those who bonded over the Hurricane Katrina recovery, BP workers prepare to move in. They have installed a gleaming chain-link fence around the property, lugged in new washers and dryers and made headway on a separate dormitory for women.

Upstairs, in the old classroom — once the domain of Sister Angelina and others — hundreds of new bunk beds have been assembled, all with just-unwrapped linens and blankets and pillows. Some stand a few inches from chalkboards that bear no chalk marks.

The first wave of BP workers, as many as 120, are expected to move in this weekend. Most will be working on land, loading boom and decontaminating boom. All will be required to follow strict house rules: lights out at 10 p.m.; no pedestrian traffic to and from camp; random drug testing; zero tolerance for drugs and alcohol.

Someday, BP will return to Arabi a building that is newly restored and available again to house Katrina volunteers, or even to serve as an evacuation site for the next emergency. “It’s going to be a very positive leave-behind for the community,” says Hank Garcia, a BP spokesman.

When that will be, no one knows. Three months? Six? The only certainty is that when BP finally does leave the building on Aycock Street, Katrina will still be waiting.

    In a Refuge Haunted by Katrina, BP Swirls In, NYT, 2.7.2010, http://www.nytimes.com/2010/07/03/us/03land.html

Alex Hits Mexico's Gulf Coast as Cat 2 Hurricane

July 1, 2010
Filed at 1:47 a.m. ET
The New York Times
By THE ASSOCIATED PRESS

SAN FERNANDO, Mexico (AP) -- Hurricane Alex made landfall on Mexico's Gulf coast as a powerful Category 2 storm Wednesday, spawning tornadoes in nearby Texas, forcing evacuations in both countries and whipping up high waves that frustrated oil-spill cleanup efforts and pushed crude onto beaches.

Alex hit a relatively unpopulated stretch of coast in Mexico's northern Tamaulipas state about 110 miles (180 kms) south of Brownsville, Texas, and was pushing inland at 10 mph (17 kph), the U.S. National Hurricane Center said.

Its heavy rains and 110 mph (160 kph) winds lashed Mexican fishing villages, whose residents fled inland to the town of San Fernando on buses and in the back of pickup trucks.

Hundreds of people filled a storm shelter in an auditorium in San Fernando.

''We didn't bring anything but these clothes,'' said evacuee Carolina Sanchez, 21, motioning to two small plastic bags at her feet, as her 3-year-old sister Belen Sanchez Gonzalez clutched a purple and white stuffed toy poodle at the storm shelter. Her father, a fisherman, was one of many coastal residents who stayed behind to keep watch on their homes and possessions.

Engineer Abel Ramirez of San Fernando's Civil Protection and Fire Department said seven fishing villages, with a combined population of about 5,000, were being evacuated.

The civil defense office in Matamoros, across the border from Brownsville, said Alex's rains had already flooded around 30 neighborhoods there and officials were using small boats to rescue some residents.

Alex spawned two tornadoes around Brownsville, including one that flipped over a trailer. Officials also closed the causeway to South Padre Island, a popular vacation getaway off the Texas coast, and 9-foot waves were reported on the island's beach.

But officials in Texas said the U.S. state had been spared a direct hit. No injuries or severe damage were immediately reported.

The National Weather Service downgraded its storm warning for the Texas coast from hurricane to tropical storm strength.

More than 1,000 people in low-lying Hidalgo and Cameron counties fled to storm shelters. More than 1,000 homes were without power late Wednesday, with the biggest outage caused not by the storm but by a car that ran into a utility pole, American Electric Power spokesman Andy Heines said.

At least 100 families took shelter in a Brownsville high school.

Sergio Gonzales, 18, arrived with nine other family members after his father decided their house may not survive the flood.

Gonzales didn't agree with his dad.

''I think it's just going to be a normal one,'' he said.

The main threat as the hurricane begins to fall apart over land will be tornadoes, which could last another day or two, hurricane center meteorologist Chris Landsea said.

The other big threat is rain, Landsea said. Parts of Mexico and Texas are expected to get 6-12 inches of rain, which could cause flash flooding farther west, away from the coast, he said.

The storm was far from the Gulf oil spill, but cleanup vessels were sidelined by the hurricane's ripple effects. Six-foot waves churned up by the hurricane splattered beaches in Louisiana, Alabama and Florida with oil and tar balls.

It was the first June hurricane in the Atlantic since 1995, according to the hurricane center.

Many in the border cities braved the growing rains: Commuters struggled to get to work, pedestrians crossed the bridge connecting Matamoros and Brownsville and newspaper hawkers manned the less-flooded intersections.

Government workers stuck duct tape in X's across the windows of the immigration office at the main downtown bridge in Matamoros on Tuesday. Trucks cruised slowly down residential streets carrying large jugs of drinking water and cars packed supermarket parking lots.

Flash floods also forced hundreds of evacuations in the southern Mexican states of Oaxaca and Guerrero, but hurricane specialist Eric Blake said those rains were only indirectly related to Alex and possibly the residual effects of Hurricane Darby, which has dissipated in the Pacific.

Three people, including a 5-year-old child, were killed when heavy rains and winds brought down a wall over their wooden house in Acapulco, state Civil Protection authorities said.

Texas also watched Alex's outer bands warily. Alex was expected to bring torrential rains to a Rio Grande delta region that is ill-suited -- economically and geographically -- to handle it.

Texas residents had been preparing for the storm for days, readying their homes and businesses and stocking up on household essentials. But concerns eased as the storm headed farther south toward Mexico.

Engineers were watching the levees in south Texas as the storm approached the area.

Scientists in Texas were also monitoring a buoy system that records the Gulf's water directions and velocity every half-hour. That information will determine where the oil could spread, should it approach Texas as tar balls on the beach, said Texas land commissioner Jerry Patterson.

Oil rigs and platforms in the path of the storm's outer bands were evacuated, and President Barack Obama issued a pre-emptive federal disaster declaration for southern Texas counties late Tuesday.

The three oil rigs and 28 platforms evacuated are not part of the Gulf oil spill response.

In Louisiana, the storm pushed an oil patch toward Grand Isle and uninhabited Elmer's Island, dumping tar balls as big as apples on the beach. Cleanup workers were kept at bay by pouring rain and lightning that zigzagged across the dark sky. Boom lining the beach had been tossed about, and it couldn't be put back in place until the weather cleared.

''The sad thing is that it's been about three weeks since we had any big oil come in here,'' marine science technician Michael Malone said. ''With this weather, we lost all the progress we made.''

------

Associated Press Writers Paul J. Weber in Brownsville, Texas and Mary Foster and Tom Breen in Grand Isle, Louisiana, contributed to this report.

    Alex Hits Mexico's Gulf Coast as Cat 2 Hurricane, NYT, 1.7.2010, http://www.nytimes.com/aponline/2010/07/01/us/AP-US-Tropical-Weather.html