‘Second worst’ oil spill ever could last until August

The failure of BP's 'top kill' procedure to plug the Macondo oil well - the source of the Gulf of Mexico spill - means the leak is likely to continue until August, with the risk that the hurricane season, which starts today, could hamper efforts.

BP has spent at least $1bn on containment, clean-up, compensation and plugging efforts so far. That could rise to $3bn as the company now attempts a new operation to collect the oil, while continuing to drill two relief wells designed to bring an end to the spill once and for all.

WHY DID 'TOP KILL' FAIL? 'Top kill' was an attempt to overcome the flow of oil from the Macondo well by injecting a mixture of mud and debris - including shredded golf balls - through the blow-out preventer (BOP) valve, which sticks out into the sea above the well, before permanently sealing it with concrete. Despite using 30,000 barrels of the mud and debris mixture at rates of up to 80 barrels a minute, the pressure of oil coming up from the Macondo oil deposit was simply too strong.

WHAT ARE BP'S OPTIONS NOW? BP will now use submersible robots to cut a broken pipe which extends from the BOP. It will then deploy a funnel over the cleanly cut pipe, a process that will take about four days. This is not a permanent solution since the funnel does not have a watertight seal, but it will capture the vast majority of the escaping oil. If it goes wrong, however, the leak will be made worse, since the bent pipe over the BOP has until now suppressed the leak to some extent.

In the longer term, BP is continuing to drill two relief wells in an attempt to intercept the leaking Macondo well. These will be injected with concrete, plugging the Macondo oil well permanently. However, the most advanced of these wells will not be complete until the end of July.

HOW MUCH IS THIS GOING TO COST BP? The value of BP's shares has fallen 36 per cent since the Deepwater Horizon oil rig exploded in April, causing the oil spill. Today alone, BP shares fell 13 per cent - wiping £12bn off its market capitalisation and suggesting investors think BP's losses over this oil spill could be monstrous.

A widely quoted analysis by Canaccord Genuity suggests that, if BP is found to have been grossly negligent, and if the spill goes on to mid-August - a scenario that's looking increasingly likely - $26bn in civil penalties could be payable. That’s on top of the estimated $3bn clean-up costs.

HOW LONG IS THE SPILL GOING TO LAST? Carol Browner, director of White House energy and climate change policy, told NBC's Meet the Press yesterday: "What the American people need to know is that it is possible we will have oil leaking from this well until August.

"We're going to hope for the best and prepare for the worst. The worst is that we have oil leaking until August, until these relief wells are done."

Any more delays could prove terminal for efforts to plug the leak. The Gulf of Mexico hurricane season has already begun - and August is when the most severe hurricanes are to be expected.

HOW BAD IS THE BP OIL SPILL? President Obama clearly suspects BP of underestimating the extent of the problem. Browner said: "BP has a vested financial interest in downplaying the size of this. They will pay penalties at the end of the day, a per-barrel per-day penalty."

For its part, BP has been casting doubt on the assertions of scientists who say there are vast underwater plumes of oil out in the Gulf of Mexico. "The oil is on the surface," says BP CEO Tony Hayward. "Oil has a specific gravity that's about half that of water. It wants to get to the surface because of the difference in specific gravity."

As for how much oil is out there, based on independent estimates of between 12,000 and 25,000 barrels of oil leaking per day, a total of between 500,000 and 1 million barrels have leaked so far. Even if the spill is finally plugged by the end of July, between 1.2m and 2.5m barrels will have leaked, making it the second worst spill in history. The highest estimate of a 150,000 barrels-a-day leak doesn't bear thinking about.

WHICH IS THE WORST OIL SPILL IN HISTORY? The Gulf War oil spill. In 1991, retreating Iraqi troops blew up Kuwait's oil wells, leaking up to 11 million barrels of oil into the desert before they could be capped. It would take until June next year for the Macondo well to leak this much oil.

WHAT IF THE LEAK WENT ON FOREVER? There are around 50 million barrels of oil in the Macondo deposit - the one BP is attempting to plug. At the current flow rate, it would take seven years to empty. Before then, BP would surely have to consider the nuclear option. ·