As thousands of barrels of oil continue to spew into the Gulf of Mexico, economists, environmentalists and government officials on Friday were assessing the damage from a disaster that could last for months and cost billions to clean up.
“It’s starting to look like the financial crisis written in oil,” said Lisa Margonelli, director of the Energy Policy Initiative at the New America Foundation, a Washington, D.C., think tank. “No Drama Obama is going to have to do something dramatic. He’s going to have to show he’s willing to punish the oil companies." The spill already covers an area the size of Connecticut and is spreading. The total cost of the cleanup, plus compensation, legal bills and lost revenue, could be as much as $22.6 billion, according to an estimate by analysts at Barclays Capital.
BP, the oil company that leased the drilling rig that exploded and sank on April 20, has already spent $450 million, Doug Suttles, BP’s chief operating officer, said at a press conference in Louisiana Friday. Analysts have estimated BP’s total costs at $15 billion for cleanup, settlements of class-action lawsuits and other costs. That’s more than twice the highest estimates of Exxon’s costs after the 1989 Exxon Valdez oil spill (a third more even when adjusted for inflation), which the International Tanker Owners Pollution Federation Limited calls the most expensive oil spill in history.
“This tragedy in the Gulf requires immediate attention to offshore drilling,” Aaron Neville, a New Orleans native and Grammy-winning singer, told The Fiscal Times. “The potential devastation is heartbreaking as we continue to rebuild after hurricane Katrina. I am hoping and praying that Louisiana and the entire Gulf fishing industries and coast lines remain safe.”
On Friday, undersea robots tried to thread a small tube into the leaking pipe gushing oil in an effort to stanch the flow. Federal regulators approved the use of a technique that involves shooting chemical dispersants 5,000 feet beneath the sea. In Mississippi, workers have placed more than 350,000 feet of boom along the coastlines to protect sensitive areas .
Loans to Keep Small Businesses Afloat
The Small Business Administration expanded its Economic Injury Disaster Loan declaration on Friday to include six counties in Alabama, 35 counties in Florida and 11 counties in Mississippi, in addition to the 34 counties in Louisiana already included in a previous declaration. The action allows small businesses to apply for up to $2 million in loans at an interest rate of 4 percent, with 30 years to repay. Some 35 loan applications are already being processed.
But it’s not just the government that’s taking action. Two other initiatives show how Americans from every corner of the country are helping.
A new nonprofit corporation, GulfAid, will host a concert on Sunday afternoon and evening in New Orleans to raise funds for wetland recovery, fishermen and their families.
More than 12,000 people from all over the country responded to The National Audubon Society’s request for volunteers to help with recovery efforts. Volunteers are now working to rescue oiled birds and transport them to a rescue center about 10 miles inland. Later, when the oil reaches the shore, volunteers will work on beach cleanup and bring in equipment and supplies. Melanie Driscoll, director of bird conservation for Audubon’s Louisiana Coastal Initiative, says volunteers have been scheduled through the end of June and will probably be needed longer.
“I am frightened,” said David Kennedy of the National Oceanic and Atmospheric Administration. “This is a very, very big thing. The efforts that are going to be required to do anything about it, especially if it continues on, are just mind-boggling.”
--With reporting by Blaire Briody, Jennifer DePaul, Michelle Hirsch, Georgette Jasen and Maureen Mackey
For more coverage of the Gulf oil spill: