Vitol and Helios Investment Partners confirm they are in exclusive negotiations with Shell for the potential acquisition of equity in Shell’s downstream businesses in 19 countries in Africa

Geneva, 21st July, 2010

Today the Vitol Group (“Vitol”) confirmed that it is in exclusive negotiations with Shell Oil Products Africa (Shell) for the potential acquisition of equity in their downstream businesses in 19 countries in Africa, subject to final negotiations and any necessary regulatory and final company approvals. Vitol’s potential acquisition of equity will be in partnership with Helios Investment Partners (“ Helios”), a major investment firm focusing on Africa and one of the few independent pan-African private equity investment firms to be founded and managed by Africans.

The scope of the negotiations is Shell’s downstream businesses (Retail, Commercial Fuels, Lubricants, Liquefied Petroleum Gas (LPG), Bitumen, Aviation and Marine) in Morocco, Tunisia, Egypt (excluding lubricants), Cote d’Ivoire, Burkina Faso, Ghana, Togo, Senegal, Mali, Guinea, Cape Verde, Kenya, Uganda, Tanzania, Botswana (excluding LPG), Namibia, Madagascar, Mauritius and La Reunion.

The scope of the business includes 1300 retail sites, retail sales of around 3,500,000 cubic metres, and 1,200,000 cubic metres of terminal storage. There are around 2500 employees currently employed in the various businesses in the 19 countries.

Under the terms of the exclusivity agreement, Shell will not be holding discussions with any other third party other than Vitol and Helios for the time being. In addition, under the scope of a potential deal between the three companies, it is envisaged that Shell would retain a shareholding and the Shell brand would remain across all marketing businesses, including retail and lubricants. With the exception of Egypt, Shell’s lubricants businesses in all 19 countries would also be in scope.

Further details regarding negotiations, bids and scope is commercially sensitive and confidential at this time.

About Vitol:

The Vitol Group was founded in 1966 in Rotterdam, the Netherlands. Since then the company has grown significantly, to become a major participant in world energy markets and is now the world’s largest independent energy trader.

Its trading portfolio includes crude oil, oil products, LNG, natural gas, coal, power and carbon emissions. Vitol trades with all the major national oil companies, the integrated oil majors and the independent refiners and traders. Globally Vitol trades over 5.5 million barrels of crude oil and products per day. It has been doing business in Africa for more than 40 years.

In addition to its trading business, and its 50% share in the storage and terminals business, Vitol Tank Terminals International, with 11 terminals on 5 continents, Vitol has an exploration and production business which includes interests in Ghana, Cameroon, Philippines, Kazakhstan, Russia and Azerbaijan.

Further details on the Vitol Group can be found at href=”http://www.vitol.com”>www.vitol.com and on VTTI at href=”http://www.vtti.com”>www.VTTI.com.

About Helios:

Helios Investment Partners is an Africa-focused private investment firm. Helios operates a family of funds and their related co-investment entities, aggregating more than $1.2 billion in capital commitments, pursuing a full range of investment types, including business formations, growth equity investments, structured investments in listed entities and large scale leveraged acquisitions across Africa. The firm also managed the $110 million Modern Africa Fund on behalf of a range of investors which included the U.S. government’s Overseas Private Investment Corporation and several leading U.S. corporations.

Established in 2004 and led by co-founding partners Tope Lawani and Babatunde Soyoye, Helios is one of the largest investment firms focusing on Africa and is among the few independent pan-African private equity investment firms to be founded and managed by Africans.

Helios’ portfolio companies operate in more than 20 countries, and in various industrial sectors, across the African continent. The firm has significant experience in private equity investing across a broad range of industries and investment types – leveraged buyouts, recapitalizations, joint ventures, seed-stage venture capital, restructurings, and strategic public equity investments.

Limited partners in Helios’ funds include several leading global investment funds, corporate entities, family offices, high net-worth individuals and development finance institutions, the latter of which include the UK’s CDC, the US government’s Overseas Private Investment Corporation, and the IFC, the private sector arm of the World Bank.

Further details on Helios Investment Partners can be found at www.heliosinvestment.com

NEWS SOURCE

Wednesday, July 21, 2010

THE Corrib gas project has been delayed by at least another three years with gas now not expected to be brought ashore before 2013 at the earliest.

The Western People has learned that Shell’s tunnel through Sruwaddacon Bay will take up to two years to construct. The tunnel is a key component in the revised plans submitted by the exploration company to An Bord Pleanála in response to concerns about the safety of its preferred pipeline route from the landfall at Glengad to the terminal at Bellanaboy.

The protests have lost their intensity in recent months but Ms Harrington has vowed they will continue until gas is developed “properly and safely”. She’s aware that laying the onshore pipe in the water will make it more difficult for protesters to disrupt works but says “while the wrongdoing continues so will the resistance”.

Opponents of the new route will have a chance to air their views at next month’s oral hearing into the project. In an unusual move, the deadline for submissions had not passed last week when An Bord Pleanála announced that it would open its inquiry on August 24 next.

Fishermen back Shell

Two fisherman’s representative groups in Erris have agreed to facilitate Shell’s offshore works programme for the Corrib project for the next two years.

Working practices to minimise disturbance and maximise safety, ongoing inspection of water discharge facilities at the Bellanaboy terminal, the continuation of a €1.3m marine fund and financial compensation to the fishermen have all been agreed with members of the Erris Inshore Fishermen’s Association and the Erris Lobster Conservation and Restocking Association.

“Our members are happy that this agreement acknowledges our members’ fishing rights in Broadhaven Bay area,” said chairman of the Erris fishermen’s group, Éamonn Ó Duibhir. “It allows all parties to work together during the final phases of the Corrib offshore works programme over the next two years.”

Chairman of lobster conservation group, Willam Walker, said the agreement was a “reflection of the strengthening relationship with Shell”.

SOURCE ARTICLE

BP acknowledges it posted on its website an altered photo that exaggerates the activity at its Gulf oil spill command center in Houston.

ASSOCIATED PRESS

By DAVID DISHNEAU (AP) – 21 July 2010

NEW ORLEANS — BP acknowledges it posted on its website an altered photo that exaggerates the activity at its Gulf oil spill command center in Houston.

The picture posted over the weekend showed workers monitoring a bank of 10 giant video screens displaying underwater images.

Spokesman Scott Dean says Tuesday that two screens were blank in the original picture and a staff photographer used Photoshop software to add images.

Dean says the company put the unaltered picture up Monday after a blogger for the website Americablog wrote about telltale discrepancies.

He says the photographer was showing off his Photoshop skills and there was no ill intent.

Dean says BP has ordered workers to use Photoshop only for things like color correction, cropping and removing glare.

Copyright © 2010 The Associated Press. All rights reserved.

SOURCE

Quoting sources close to BP, the Times reported that his exit is expected before 1 October if the ruptured well is sealed and his exit could be announced alongside a new strategy being hammered out for the group called Future BP. An insider said Hayward’s departure formed part of the group’s defence against any attempted buyout by ExxonMobil or Royal Dutch Shell.

• Chief executive expected to leave before 1 October
• BP plans to sell $7bn of assets for clean-up fund
• Fears oil still leaking despite containment cap
• Oil spill discussed by Barack Obama and David Cameron

Dan Milmo: Wednesday 21 July 2010 08.23 BST

BP chief executive Tony Hayward is set to step down by 1 October, the Times reports. Photograph: Suzanne Plunkett/Reuters

BP chief executive Tony Hayward is preparing to step down within the next 10 weeks, according to a report this morning, as the embattled oil giant announced plans to sell $7bn (£4.6bn) of gas assets for its Gulf of Mexico clean-up fund.

Hayward was heavily criticised for his reaction to the Deepwater Horizon disaster including the statement, “I want my life back”, that led to accusations of insensitivity. The beleaguered chief executive may get his wish soon, amid a growing expectation that the 53 year-old will announce his departure in late August or September.

Quoting sources close to BP, the Times reported that his exit is expected before 1 October if the ruptured well is sealed and his exit could be announced alongside a new strategy being hammered out for the group called Future BP. An insider said Hayward’s departure formed part of the group’s defence against any attempted buyout by ExxonMobil or Royal Dutch Shell.

Robert Dudley, the American who runs BP’s Gulf Coast Restoration Organisation, has been heavily tipped to succeed Hayward.

A spokesman for BP, however, told Reuters that Hayward “has full support from the board and will remain in place”.

Speculation about Hayward’s future coupled with news about disposals by the oil giant, helped shares in BP open up 10.55p at 398p, a rise of almost 3%.

The Gulf of Mexico spill, which could be discharging 70,000 barrels a day, has featured high on the agenda in a meeting between Barack Obama and David Cameron in Washington this week. Cameron said yesterday that BP should not be blamed for the “completely wrong” decision to release the Lockerbie bomber, Abdelbaset al-Megrahi, amid reports that the oil company pushed for his transfer to Libya in a bid to ease access to oil fields.

Obama effectively pronounced sentence on Hayward and his less than convincing public performance last month when he said: “He wouldn’t be working for me after any of those statements.”

Standoff

A standoff between the company and the US government has developed over the past few days, after BP installed a new containment cap on the ruptured well ahead of its permanent plugging next month. While the cap seems to have stemmed the flow, there is growing anxiety among government officials about the continued seepage of hydrocarbons from the seabed.

The government fears oil may be leaking below the surface, and that if left unchecked this process could cause graver problems, including the collapse of the well.

Earlier in the week Thad Allen, the official appointed by Barack Obama to lead the federal response to the disaster, warned BP that the US government reserved the right to reopen the well if worries about seepage intensified.

The spill has forced the company to look at asset disposals to raise cash to pay for the rising cost of the clean-up, which has already reached almost $4bn.

BP has already agreed to set aside $20bn to pay for the clean-up and has revealed plans to sell $10bn worth of assets. It has taken a significant step towards hitting that $10bn target by announcing the sale of onshore gas assets in the US, Canada and Egypt to US-based company Apache in a $7bn deal.

The assets represent 2% of BP’s reserves and produce an estimated 331m cubic feet of gas a day. The first $5bn of the purchase price will be paid at the end of the month.

Steven Farris, Apache’s chief executive, said: “We seldom have an opportunity like this in one of our core areas, let alone three.”

BP added that it will sell most of its assets in Vietnam and Pakistan, which are valued at $1.7bn. One analyst said BP could reach $10bn “quite easily” by selling non-core assets that would have been sold within five years anyway. Other potential sale assets include a $9bn stake in Argentina’s Pan American Energy and fields in Colombia and Venezuela.

SOURCE ARTICLE

THE WALL STREET JOURNAL

JULY 21, 2010

By ANGEL GONZALEZ

Agence France-Presse/Getty Images: An undated photo of a drilling rig in the Gulf of Mexico.

The recent transfer of two deepwater drilling rigs from the Gulf of Mexico to waters elsewhere prompted critics of a government drilling ban to repeat predictions of a mass flight that would wreck the region’s economy and severely curtail U.S. energy production.

But nearly eight weeks after Interior Secretary Ken Salazar announced a six-month moratorium on deepwater drilling, 31 of the 33 rigs that were operating in the Gulf when the Deepwater Horizon exploded remain there.

While at least one other rig could be moved soon, several experts say an exodus is unlikely. Oil companies have found few other promising reservoirs where they could immediately transfer their rigs. Moreover, an expected surplus of newly built rigs next year will make it easier to replace rigs that do leave.

“The dire predictions will not come to pass,” said Amy Myers Jaffe, head of the Baker Institute Energy Forum at Rice University.

Oil companies are finding formulas to keep leased rigs in the area, such as agreeing to pay standby fees to drilling contractors or doing maintenance or other work unrestricted by the ban. Two oil-industry analysts predict that only about one-fourth to one-third of the Gulf’s deepwater rigs will end up leaving, and many will eventually return or be replaced.

Joe White discusses why BP is considering yet another method to kill its ruptured Gulf of Mexico oil well amid concerns that the cap it installed last week could allow oil and gas to seep out the sides.

“There’s no reason rigs won’t migrate back,” said Tom Kellock, a consultant for ODS-Petrodata, a company providing market intelligence to the oil and gas industry.

The equation could change if drilling is restricted beyond November, or if oil companies find the new regulations unpalatable. But right now oil companies are taking a wait-and-see attitude before changing drilling plans, even as they vehemently oppose the moratorium. The Gulf’s rich deepwater reservoirs are critical to the growth plans of behemoths such as Chevron Corp. and Royal Dutch Shell PLC. So they are working with drilling companies, which own the rigs, to try to keep many of them in the Gulf.

“We will resume our activities in the Gulf when we can,” said Statoil ASA spokesman Ola Morten Aanestad.

The suspension of drilling activities and strengthening of oversight have become key issues for the Obama administration, which saw an initial moratorium from May 27 struck down by federal courts. A new moratorium, expiring on Nov. 30, was put in place July 12, riling oil-industry executives and Gulf Coast officials who say it will cost the region thousands of jobs.

“We’ve already seen rigs leaving, and heard talk of others making plans to move units,” said Mike Killalea, a spokesman for the International Association of Drilling Contractors, a trade group. “We’ll export an entire high-technology industry.”

U.S. authorities say a pause in drilling is needed until the causes of the catastrophic April BP PLC well blowout are known. The explosion killed 11 people and unleashed the worst offshore oil spill in U.S. history.

At lease rates of about $500,000 a day, drilling contractors and oil companies have strong incentives to find work for idle rigs elsewhere. The departure to Egypt and Congo of two Diamond Offshore Drilling Inc. rigs in the past two weeks, which stirred concerns of moratorium critics, and the idling of other units is prompting the company to cut 250 jobs, Chief Executive Larry Dickerson said.

The Houston-based drilling contractor, which sued the federal government over the moratorium, is trying to market other idle Gulf rigs abroad, Mr. Dickerson said. “We’re having a smaller and smaller Gulf presence,” he said. Diamond has four other deepwater drilling rigs in the Gulf.

Noble Corp. is also marketing an idle deepwater rig abroad, Chief Executive David Williams said in an earnings call Tuesday. Another drilling contractor and an oil company are in talks to transfer a rig abroad under an existing contract, said ODS-Petrodata’s Mr. Kellock.

But vessels come and go. Four rigs have actually arrived since the May 27 moratorium announcement, Mr. Kellock said.

Some oil and gas companies have struck deals with drilling contractors to keep rigs close by while they wait out the moratorium. Shell, which has four leased deepwater rigs in the Gulf, or about 40% of its global deepwater fleet, is paying standby fees to Noble and Transocean Ltd. to keep critical staff employed and to allow for a quick restart of its drilling program. “These are high-performing rigs with great people and we have a clear desire to keep them in our fleet,” Shell said in a statement.

Australia-based BHP Billiton Petroleum, a unit of BHP Billiton Ltd., also agreed to a standby fee with Transocean.

Smaller companies are in on the act as well. Noble Energy Inc. reached an agreement to pay Noble Corp. $145,000 a day to keep a drilling rig in the Gulf for as long as restrictions last. (The companies are not related.)

Other companies are playing hardball to negotiate cheaper rates, said Joe Hill, an analyst with energy investment bank Tudor Pickering Holt. Statoil, Eni SpA, Anadarko Petroleum Corp. and Chevron have sought to cancel their normal obligations on some contracts. Such force majeure declarations are opposed by drilling contractors.

“It’s all negotiation,” Mr. Hill said.

The fate of Gulf deepwater drilling may ultimately depend on whether oil companies perceive that the ban will be extended, or that they’ll be subjected to unreasonable rules. If so, more flight is likely, Mr. Hill said. But if the price of crude rises and political pressure subsides after the spill stops, recovery will be quick, he said.

—Jason Womack contributed to this article.

Write to Angel Gonzalez at angel.gonzalez@dowjones.com

Gale Norton “sent a clear message: the priority was more drilling first, safety second,” Waxman said.

Associated Press

Published July 20, 2010

WASHINGTON

Two former Interior secretaries told Congress Tuesday they did not anticipate an accident as large as the BP oil spill in the Gulf of Mexico.

But Gale Norton and Dirk Kempthorne say no one else did either — including members of Congress who are now blaming the Bush administration for failing to prevent the tragedy.

Kempthorne, who served as Interior secretary from 2006 to January 2009, while George W. Bush was president, said he did not recall being asked at his confirmation hearing or in later congressional testimony about major oil spills.

In fact, Kempthorne said, the opposite occurred. In testimony before the House Energy and Commerce Committee, he recalled being pointedly asked why Interior wasn’t doing more to expand offshore energy development, not less. Those concerns were driven by $4 per gallon gas prices, Kempthorne said.

Norton, who served from 2001 to 2006, also under Bush, said the industry had a remarkable safety record, including during Hurricanes Katrina and Rita in 2005.

Before the Deepwater Horizon rig exploded April 20, killing 11 men, “there was a 40-year record of environmental protection in offshore drilling,” Kempthorne said. Since the 1969 oil spill near Santa Barbara, Calif., natural cracks in the sea floor had caused oil seeps larger than oil spilled due to offshore drilling, he said.

Interior Secretary Ken Salazar, who took office in January 2009, acknowledged that long safety record and said he and other members of the Obama administration “were lulled into a sense of safety” that proved to be false.

“Prior administrations and this administration have not done as much as we could have done relative to making sure that there was safer production in the Outer Continental Shelf,” Salazar said, referring to coastal areas where offshore drilling occurs.

In the wake of the Gulf oil spill — which has dumped as much as 184 million gallons of oil into the sea — Salazar has imposed a six-month ban on deepwater drilling.

The moratorium, in effect through Nov. 30, could be modified or lifted in specific cases if drillers can answer questions about drilling safety, oil containment and adequacy of response in case of an oil spill, Salazar said.

Rep. Henry Waxman, D-Calif., chairman of the Energy and Commerce panel, said the Interior Department made serious mistakes under both President Bush and President Barack Obama.

“The cop on the beat was off-duty for nearly a decade. And this gave rise to a culture of permissiveness,” Waxman said.

Waxman said the agency’s problems escalated dramatically under a “secretive task force” on energy organized by former Vice President Dick Cheney in 2001. The task force gave Interior marching orders to provide incentives to oil and gas companies to increase domestic production, while reducing regulatory impediments that may slow production, Waxman said.

He told Norton that under her watch, it appeared that the mission of the Minerals Management Service — the Interior agency responsible for offshore drilling — was mainly to serve the oil and gas industry by helping to expand deepwater drilling.

Her decisions “sent a clear message: the priority was more drilling first, safety second,” Waxman said.

Norton, now a lawyer for Royal Dutch Shell oil company, called that unfair. Interior took numerous steps to increase safety, including reducing areas where drilling was permitted off the coast of Florida, she said.

Norton said the 2001 terrorist attacks brought the need for domestic energy production “shockingly into focus,” adding that the attacks transformed the need for more domestic energy “into a matter of grave national security.”

Norton and Kempthorne urged Congress to take a balanced approach, increasing safety while not unnecessarily impeding domestic drilling.

Both said they opposed the six-month moratorium on deepwater drilling imposed by the Obama administration.

“In my mind you don’t ground all the airplanes because there was one problem” with a plane crash, Norton said.

“The important thing is to address the (safety) issues, not send the drilling rigs overseas where they may not return for several years,” with the result that thousands of jobs are sent to other countries, she said.

Kempthorne called an initial safety review appropriate after the initial explosion, but said the moratorium now is causing more harm than good. A former Idaho governor and senator, Kempthorne is now a business consultant in Idaho and Washington, D.C.

SOURCE ARTICLE

On multiple occasions, reports prepared for the Minerals Management Service (MMS) warned that the blowout preventers (BOPs) used on offshore wells were unreliable. The Department never acted on these warnings.

THE HUFFINGTON POST

Interior Secretaries Under Bush And Obama Exposed By House Panel For Lax Oversight Of Oil Drilling

07-20-10

A tough new memo from a House committee probing the Gulf oil spill exposes the Interior Department under Presidents Bush and Obama for its failure to properly oversee offshore oil drilling operations. The three most recent Interior Secretaries — Gale Norton (2002-2006), Dirk Kempthorne (2006-2009), and Ken Salazar (2009-present) — all come in for withering criticism and are due to testify at congressional hearing on Tuesday, where they are sure to be asked tough questions about their tenure.

The memorandum from the House Energy and Commerce Committee’s Democratic majority staff takes perhaps the toughest stance on Norton’s controversial tenure (she was recently the subject of a Justice Department probe into whether she acted improperly by granting Royal Dutch Shell several valuable oil shale leases on federal land shortly before she took a job with the oil giant — DOJ has reportedly closed its probe as of last week).

Just two weeks after Bush was sworn into office in 2001, he asked Vice President Dick Cheney to head a task force to develop energy policy. The much-criticized task force met privately with oil and gas executives and Cheney repeatedly refused to disclose their identities. In May 2001, the group issued its report, which stated that “exploration and production from the OCS [Outer Continental Shelf] has an impressive environmental record.” It also stated that existing environmental permitting laws and regulations, at the federal and state level, were creating “delays and uncertainties [that] can hinder proper energy exploration and production projects.”

As the federal official responsible for implementing much of the administration’s new energy policy, Norton encouraged offshore drilling with incentives for oil companies but she “imposed few new safety standards on offshore drilling operations,” according to the memo.

“On multiple occasions, reports prepared for the Minerals Management Service (MMS) warned that the blowout preventers (BOPs) used on offshore wells were unreliable. The Department never acted on these warnings. The Department also rejected efforts begun in the Clinton Administration to strengthen federal regulation of offshore well cementing practices.”

Kempthorne didn’t perform much better — after the sale of a lease for the Macondo well, the site of the Deepwater Horizon disaster, to BP for $34 million in 2008, he crowed that the agency had “won the championship.” In addition, the memo describes the extent to which the agency underestimated the extent of any spill: “The environmental assessments prepared by the Department for the lease area found that the most likely size of a large spill would be just 4,600 barrels, less than 1% of the amount of oil that has been spilled from the Macondo well since April 20, 2010.”

Under Kempthorne, the agency was also embroiled in an embarrassing scandal in 2008, in which it was revealed that government employees accepted gifts, used drugs with and had sex with oil industry officials.

Though the memo notes that Salazar has instituted some reforms and some needed regulations for the agency’s Minerals Management Service, which oversees offshore oil and gas drilling, it takes the agency to task for its decisions regarding the Deepwater Horizon. Specifically, MMS granted BP a “categorical exclusion” from the need to conduct a thorough site-specific environmental review. The agency also allowed BP to make several key revisions to the drilling site, changes which have been shown to have potentially played a major role in the rig’s disastrous explosion on April 20, 2010.

READ THE MEMO: DOI+Track+Record+%26+Oil+Spill+Hearing+Memo

SOURCE ARTICLE

REUTERS

HOUSTON/WASHINGTON (Reuters) – British energy giant BP Plc said on Tuesday it reached a $7 billion deal with Apache Corp as part of a series of asset sales to raise money to pay for the worst oil spill in U.S. history.

BP said Apache would pay a $5 billion cash deposit on July 30 as part of the deal for upstream assets in North America and Egypt. The company said the deal, worth a total of $7 billion, would include Permian Basin assets in New Mexico, natural gas in western Canada and concessions in Egypt.

Earlier in the day, BP announced it would sell $1.7 billion worth of assets in Vietnam and Pakistan.

Rig operator Ensco Plc filed a lawsuit on Tuesday challenging the Obama administration’s new deepwater oil drilling moratorium, saying it was mostly the same as the first ban that a U.S. court already put on hold.

The Interior Department “did not analyze the situation anew and with an open mind when deciding to impose the second moratorium,” Ensco said in a complaint filed with the U.S. District Court for the Eastern District of Louisiana.

The BP asset sales were announced exactly three months after an explosion on an offshore rig killed 11 workers and caused millions of barrels of crude to spill into the Gulf of Mexico.

The spill has caused an economic and environmental disaster in five states along the Gulf Coast, hurt President Barack Obama’s approval ratings and complicated traditionally close ties with Britain.

BP has committed to raise $10 billion in the coming year to pay for damage claims, the cleanup and legal costs related to the leaking well.

BP, which said on Monday it had spent about $3.95 billion so far on the oil spill, agreed under intense pressure from U.S. authorities last month to set up an independently administered $20 billion escrow fund for damage claims from the spill.

The Obama administration has stressed that the amount is not a cap on the company’s liabilities.

During a visit to Washington, British Prime Minister David Cameron praised the company for the steps it has been taking to plug the leak and to pay for damages suffered by people in the Gulf, where the vital tourism and fishing industries have been devastated.

During a visit with Obama, Cameron said he understood U.S. anger at BP over the oil spill. But he said it was also important to both the U.S. and British economies that the company stay strong and stable.

TEST TO CONTINUE, “STATIC KILL”?

The U.S. government on Tuesday approved another 24-hour extension of a pressure test of the well.

The broken well was capped last week — at least temporarily — after spilling up to 60,000 barrels a day of crude for three months.

The well test, which has been extended in 24-hour increments by the U.S. government, will continue until Wednesday afternoon and then be reevaluated for a possible further extension.

Scientists are now weighing another option — a so-called “static kill” to help smother and plug the leak.

The top U.S. oil spill official said BP could have a plan to proceed with the static kill option within 24 hours.

This would involve pumping heavy drilling mud and possibly cement into the well, much like BP’s failed “top kill” in May.

(Additional reporting by Doina Chiacu and Tabassum Zakaria in Washington, Matthew Lynley in New York, Kristen Hays and Chris Baltimore in Houston; Writing by Deborah Charles and Sitaraman Shankar; Editing by Eric Beech)

REUTERS ARTICLE