The Obama administration’s spill response leader, retired Coast Guard Commander Thad Allen, backed down Monday from earlier demands that BP remove a cap that has shut the flow of oil from the blown out Macondo well. Allen said that the cap, in place since Thursday, could be maintained for another day and that he would reevaluate each day whether or not it could remain fully closed.

 

The decision comes even though a seepage, likely oil and methane, has been found within two miles of the well, along with “undetermined anomalies at the well head,” according to a Sunday letter from Allen to BP. BP spokesman Mark Salt said late Sunday that he had no information regarding the seepage mentioned in Allen’s letter.

 

On Monday afternoon Allen confirmed that oil was also leaking from the new cap, but declared that it was not a cause for concern.

 

The closing of the cap was initially billed by both the Coast Guard and BP as a 48-hour test during which pressure in the well would be gauged. BP had earlier stated that pressure should be at 9,000 pounds per square inch (psi), later revising that down to 8,000 psi and then 7,500 psi. A reading lower than this, it was repeatedly stated, might indicate that the well casing, which descends 13,000 feet below the seabed, could be damaged. If so, capping and pressure testing would have to be aborted for fear of worsening the situation.

 

After five days, the pressure reading has yet to surpass 6,800 psi, far lower than expected. However, the Obama administration has bowed before BP’s demand to keep the cap fully closed.

 

Allen had repeatedly declared that valves in the capping would be released after the initial 48-hour test regardless of the pressure reading so that scientists could evaluate the data. This would have allowed oil to gush out for about three days to relieve well pressure before a series of take-away hoses could be attached to the new capping device, Allen said Saturday.

 

BP had other ideas, simply refusing to remove the cap as originally planned. BP chief operating officer Doug Suttles declared Sunday, openly defying Allen’s announcement made a day earlier, that the valves would not be loosened and that the cap would not be removed. The company has also refused to release data from the tests.

 

“BP PLC capped the nearly mile-deep well Thursday and wants to keep it that way,” according to the AP. “The government’s plan, however, is to eventually pipe oil to the surface, which would ease pressure on the fragile well but require up to three more days of oil spilling into the Gulf ... [T]he government is worried that the cap on the well is causing oil and gas to leak out elsewhere, which could make the sea floor unstable and cause the well to collapse.”

 

Several commentators have pointed to an obvious reason BP may want to keep the cap shut down, regardless of what may be happening under the seabed: to save itself from financial damages, which are ultimately calculated based on the amount of oil spilled. With the cap closed, any oil leaving the Macondo elsewhere cannot be measured.

 

“If the well remains fully shut in until the relief well is completed, we may never have a fully accurate determination of the flow rate from this well,” said Democratic Rep. Ed Markey of Massachusetts. “If so, BP—which has consistently underestimated the flow rate—might evade billions of dollars of fines.”

 

In his letter, Allen also appeared to indicate that BP is not allowing unfettered access of monitoring equipment to the well and the surrounding area. “As a continued condition of the test, you are required to provide as a top priority access and coordination for the monitoring systems, which include seismic and sonar surface ships and subsea ROV [remote operating vehicles] and acoustic systems,” Allen wrote. “When seeps are detected, you are directed to marshal resources, quickly investigate, and report findings to the government in no more than four hours.”

 

According to oil industry experts, there is high probability that the well casing was damaged, perhaps even in the initial explosion.

 

“The biggest concern is the integrity of the well casing,” said John Hofmeister, former president of Shell Oil in a Washington Post online question and answer session. “It is an under designed well. The pressure and the explosive force of the original blowout could have damaged the well casing in one or more locations. Especially at the mouth of the reservoir. If oil is seeping on the outside of the casing because of the cap a lot or a little it cannot be controlled by the cap, that may be the source of the current seepage.”

Hofmeister said that “the near term fix is to release the cap and control the flow of oil to surface ships.” He added that if the well casing is damaged, the relief wells may not stem the flow of oil into the Gulf. “The probability of success is uncertain but it’s still the best option for now,” he wrote.

The strange sequence of events leading up to BP’s decision to attempt to gauge pressure in the well, to temporarily suspend the drilling of relief wells that had been presented for weeks as the only remaining solution, and to continue with the capping in spite of low pressure readings and evidence of seepage, was addressed by industry insider Carl Larry, of Oil Outlooks and Opinions, in an interview with Bloomberg.

 

“There’s a lot of things that need to be questioned here,” Larry said. “Number one, did BP actually know about another leak further down the line [below the sea floor], and what will they do about not just the leak that needs to be capped but about this new leak? So now we’re talking about two leaks which actually causes a much bigger problem than we already know.”

Larry added: “The amount of oil that’s spilled out, and possibly even at the rate that they were saying it was spilling out, was obviously too big for that pipeline … [W]e never got a confirmation of actually how much oil was being spilled out of that pipeline. And that almost raises the question: how did they know or why didn’t they know how much was coming out of that pipeline and maybe they might have known that oil was coming out somewhere else. Very big questions here that really need to be answered.”

 

Larry also said the prospect of a relief well working is now “a very big ‘if.’”

 

Low pressure readings could also be the result of the draining of the oil reservoir, which was believed to contain billions of gallons of oil. According to the AP, this would mean more oil has been released into the Gulf than the 95 million to 185 million gallon range estimated by the government.

 

That the gusher was far larger than has been revealed is also admitted by the containment capacity of the ships BP has slowly put in place above the Macondo. Should the capping process be aborted, another containment ship will shortly bring daily capacity to 80,000 barrels, or 3.4 million gallons, per day. If this were the daily spill rate, then about 260 million gallons were dumped into the Gulf before BP installed its new cap on Thursday.