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US Coast Guard orders Louisiana oil company to stop 14-year old Gulf of Mexico leak

03 December 2018

The United States Coast Guard (USCG) has ordered Taylor Energy Company to contain and clean up an ongoing oil spill in the Gulf of Mexico, which the federal government says has leaked more than a million barrels of oil since 2004. According to the Washington Post the order was issued on 23 October 2018, and the company faces fines of $40,000 per day if it fails to comply.

Stock image
Stock image

Taylor Energy’s MC-20 Saratoga platform was destroyed by Hurricane Ivan in September 2004 when an underwater mudslide snapped the 550-foot-tall platform’s legs and buried a cluster of wells.

Taylor plugged some of the 28 wells and added three containment domes but between 300 to 700 barrels (50,000 to 115,000 litres) of oil per day still spews from wells around the platform, according to a recent government-commissioned study.

Taylor Energy and federal officials have established a $666 million trust to pay for the leak response. Although the company has spent hundreds of millions trying to stop the leak, it has proven difficult to cap the affected wells that are deep underwater and buried beneath 100 feet of mud.

Taylor Energy has mostly ceased to exist as a company and President William Pecue is its last remaining employee. He has argued that because the hurricane was an act of God under the legal definition of the term, the Government should return the $450 million of the trust fund not so far spent and absolve the company of responsibility for stemming the leaks.

Now the Coast Guard has directed Taylor Energy to decide on a new containment plan and a contractor to do the work. The new method of containment “must eliminate the surface sheen and avoid the deficiencies associated with prior containment systems,” the Coast Guard wrote in the administrative order. The company will be fined up to $40,000 per day for failing to comply.

Full containment of the leak could cost upwards of $1 billion, according to Taylor Energy. The company disputes the new leak estimates and the cause of the chronic sheens that often stretch for miles from the well site. According to scientists employed by Taylor Energy, the sheens are caused by oil and gas bubbling up from the oil-saturated seafloor, and not from leaking wells.

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