BP shares down, spill-related legal battles rage



On Thursday June 24, 2010, 11:00 pm EDT

By Ernest Scheyder

VENICE, Louisiana (Reuters) – The Gulf of Mexico oil spill entered its 67th day on Friday with BP’s New York share price at year lows and bad weather looming that could hamper clean-up and containment efforts.

The Obama administration was pursuing its legal options after a setback on Thursday when a judge refused to put on hold his decision lifting a ban on deepwater oil drilling imposed in response to the spill, the worst in U.S. history.

After striking down the moratorium on Tuesday, a federal judge in New Orleans rejected a request to allow the six-month ban to stand while the government appeals his decision.

Judge Martin Feldman issued an order denying the stay. The government has appealed to the U.S. Court of Appeals for the Fifth Circuit and can ask it to stay Feldman’s decision.

The government imposed the moratorium after a well owned by BP ruptured on April 20, unleashing millions of gallons of crude into the sea and killing 11 workers.

BP’s share price, which has roughly halved since the rig explosion, was to be in investor focus again on Friday after losing more ground on Thursday.

BP’s U.S.-listed shares closed down 3.13 percent at $28.74 in New York trading on Thursday, hitting a new low for the year. The company’s stock lost 2.47 percent in London.

Analysts said investors were reacting to news that the U.S. government was reviewing the environmental impact of BP plans to drill in Alaska.

More generally, investors are concerned about the ultimate costs to BP as it faces more than 200 spill-related lawsuits and has agreed under political pressure to set up a $20 billion fund to pay damages to oil spill victims.

BP was forging ahead with its efforts to capture or burn off oil as it gushes from the well on the bottom of the sea.


It was mindful of the weather, which could put the brakes on its efforts. A tropical wave over the western Caribbean Sea has a high chance of developing into a tropical depression over the next couple of days, the U.S. National Hurricane Center and other weather forecasters said. (nN24131749)

Most weather models see it hitting the coast near the Texas/Mexico border in a few days but some expect the wave to turn northeast toward Florida and the eastern Gulf of Mexico near where BP’s clean-up operations are in high gear.

The disaster threatens an ecological and environmental catastrophe in the U.S. Gulf and President Barack Obama has faced criticism and falling poll ratings because of perceptions that his handling of the crisis has been slow.

“Obama better get off his ass and get something done,” Billy Nungesser, president of Plaquemines Parish (county), told Reuters at a shrimp boil in Venice, a Louisiana fishing hub.

“But he better get some people around him who … can get it done. He still has a chance to save this coast and his presidency,” he said.

(Additional reporting by Scott DiSavino in New York; writing by Ed Stoddard, editing by Stacey Joyce)




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