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Oil Well Killed, But Legal and Environmental Battles Just Beginning

Transocean Ltd. Development Driller III rig works to drill a relief well; Derick E. Hingle/Bloomberg via Getty Images
The Development Driller III rig used to drill the relief well (Photo: Derick E. Hingle/Bloomberg via Getty Images)

After a weekend of final sealing and testing, the federal government on Sunday declared the Macondo oil well officially dead. The announcement came nearly five months after the Deepwater Horizon oil rig exploded in the Gulf of Mexico, setting off the largest offshore oil spill in U.S. history.

The “well-kill” is an end to one chapter of the Deepwater Horizon story, but other chapters are just beginning. Here’s a roundup of stories to watch:

The Legal Battle | Just last week, Judge Carl Barbier held the first hearing in what’s likely to be a years-long legal fight for the more than 300 lawsuits already filed against BP and others likely to come. The Wall Street Journal explains the legal process that governs these suits:

>The idea is to roll numerous suits of similar nature filed in U.S. district courts into one case before one judge, for efficiency’s sake. The 1968 law that created the process stemmed from a price-fixing case that gummed up federal courts involving more than 25,600 claims against electrical-equipment manufacturers. But critics of the consolidation say these cases become so unwieldy they sometimes drag on for years.

BP could also face penalties under the Clean Water Act — $1,100 or $4,300 per barrel of oil spilled, depending on whether the company is found to have been “grossly negligent” in its actions. That could mean a fine of potentially $21 billion, although many experts say that BP and the government are likely to settle for less than that in the end.

BP has estimated that the spill will cost $32 billion, including $20 billion to compensate individuals and businesses hurt by the spill. It has announced plans to sell $30 billion in assets over the next 18 months to help pay for it.

The Future of Deepwater Drilling | The six-month moratorium on deepwater oil drilling imposed by the Obama administration in the wake of the spill is set to expire Nov. 30. Michael Bromwich, the nation’s chief drilling regulator, told reporters in a conference call last week that it’s “highly unlikely” the moratorium will be extended beyond that date. Bromwich also said that he expects to complete a report by the end of September with recommendations of how and when to end the drilling ban, including new mandates governing deepwater drilling.

The Houston Chronicle reports:

Even when the ban is lifted, drilling won’t begin immediately. Bromwich said Tuesday “it will be up to industry when deep-water drilling can resume, because they will only be able to resume once they’re in compliance with the existing rules” and coming mandates.

Industry analysts say it could take weeks — or longer — for the offshore energy bureau to sign off on new deep-water well applications, given the current slowdown in permitting shallow projects that are not blocked by the moratorium. Confusion about the scope of new requirements has held up some of those approvals. Bromwich said he hoped to prevent a repeat whenever the deep-water drilling ban is lifted.

“We fully understand that with new rules coming down the pike, there is the risk of confusion and uncertainty,” he said. “And I really don’t want that to extend the point where drilling can resume.”

The Ongoing Cleanup and Environmental Effects | The well has been capped since mid-July, but along parts of the Gulf Coast, the oil has not disappeared. On Saturday, Coast Guard Adm. Thad Allen told CNN that the cleanup effort is going to go on “as long as it takes to get the marshes and the beaches clean.”

The New Orleans Times Picayune reports that about 500 miles of Louisiana’s 7,700 miles of tidal coastline were oiled:

That seems a small toll — unless, like [property manager Forrest] Travirca, you manage some of those 500 miles. Then you find yourself in a place where the bullets are still flying and battle is still going on, a battle experts say you could be fighting for years to come.

“There might not be fresh oil coming ashore, but there’s a lot of residual oil that will continue to show up, especially in those places that were hard-hit,” said Ed Overton, an LSU professor who has been studying and fighting oil spills for 30 years. “This is a well-known and common occurrence in spills.”

“I’d say those folks are probably going to be dealing with this certainly for the next year, and very possibly beyond in these hot spots.”

The New York Times reports that many scientists believe that through “a combination of luck (a fortunate shift in ocean currents that kept much of the oil away from shore) and ecological circumstance (the relatively warm waters that increased the breakdown rate of the oil), the gulf region appears to have escaped the direst predictions of the spring.”

But the scientific debate continues about how much oil remains in the Gulf — suspended in the water column or sitting on the sea floor — and what long-term environmental effects it might have.

Last week, for example, University of Georgia researcher Samantha Joye said that her team found a layer of oil on the sea floor up to 80 miles from the well.

NOAA head Jane Lubchenco said last week that the federal government is organizing a long-term monitoring effort to better understand the fate of the leaked oil.