Relief well on target, says BP

TESTS show BP is on target for mid-August completion of a relief well in the Gulf of Mexico, the best hope of stopping the oil that’s been gushing since April, the company said yesterday.

The crew drilling the first of two wells ran a procedure this week to confirm it is on the correct path, spokesman Bill Salvin said.

“The layman’s translation is, ‘We are where we thought we were,’” he said.

Several such tests are needed to determine the relief well’s location relative to the well that blew out on April 20 when the offshore drilling rig Deepwater Horizon exploded. Once the new well intersects the blown-out one, BP plans to pump heavy drilling mud in to stop the oil flow and plug it with cement.

Salvin said the relief well should be done by mid-August, but that didn’t seem to help the company’s stock price, which plunged following the company’s announcement that the price tag for the response has risen to $2.35 billion (€1.9bn)

BP shares fell nearly 4% in New York yesterday. If the decline holds, BP will have lost more than $100bn (€80.9bn) in market value since a rig it operated exploded in the Gulf of Mexico.

BP’s shares closed at $60.48 on April 20, the day of the rig blast.

On Friday, they dipped as low as $27.07 and traded at $27.69 around midday.