Re: Florida: Possible Special Session on Oil Drilling

From:
Sent:
.
To:
-12 May 2010\'6:23.
I

I
~.

.' .
. Page 1 of5

Cc:

~--;--- .~-- -- ---~---~~-- -------------------------------------------------------------------------------------------- ; ---------------- :--~.

Subject: RE:.Action requi~d: Florida: Possible Special S~sion on Oil Drilling

In lieu of an agreed'HMG energy policy; may I suggest we change v,slightiy to keep as short and
simple as pas (i.e.removiJ1g ref to other tech).

Suggested Lines (deployable once proposed amendment becomes public)

..

These are decisions for the Florida legislature. .",

The UK remains" an importer and exporti.r"of oil, including from offshore drilling.
I
It is an important part of our energy mix, but we remain committed to working
towards a low carbon economy to
improve climate and energy. security. .'

I'll incorporate reference to. possible session in today's spill update.

:"" _~, British Em&assy, Washlrigton

. ,. 3100 Massachusetts Ave..NW ..........""G.

From:
Sent!: 12 May 2010
~4:22 To:

w..'",
Subject: RE! Action required: Ro~da: Possible Special Session on 011 Drll\1ng

Thanks.

12/0712010
Ke: r lOnaa: rOSSlDle >::>peCla.l >::>eSSlOn on uu urwmg Page 2 of5 .

would be better.

From:
Sent: 12 May
201012:15 To:

Subject:. ~:~oQ}'f.~ulred: Floiida; POS$lble Special ~esslqn on all

Dn111ng ,

..
Here are ttt.e; lines we've come up with at posl Subject to your yiews, they. can be deployed if approached by
media.

.,
British EmbaSSY washington
...

Suggested Lines (deployable once proposed amendment becomes public)

These are decisions for the Florida legislature.

The UK remains an importer and exporter of oil, including from offshore drilling. It is an important part of our . energy
mix.

But we remain committed to working towards a low carbon economy to improve energy and climate security. This
involves moving away from reliance on fossil fuels towards low carbon energy supplies, such as offshore wind,
renewables, nuclear power, gas, and clean coal.

'\
12/07/20'10. .
Re: Florida: Possible Special Session On Oil Page 3 of 5
Drilling

All,''';'':

.(~ur Dep Press Se,c) ~nd I ~ill circulate draft line~ for comment v.shortly.

..- th~nks fo~ your input"

.. \ '
From:_____
sent:~
To:

....

..
, ;~ . . -,
Sorry to drop this on you, but grateful if YQU can have a quick read ot8118 emaiJ at the bottom of this chain.
Basically we have been asked by.the A2]bo toprovi~ea line on the Possmti special-sessions in Florida
prohibit,jng offshore drilling: Woul~you, m conjunctiqn with pECC, be able to provide this for '

today? '" --- ........, ;, .

My initial thought is that this is an internal US matter (rt is not calling to exclude only foreign companies) and any overt line from us could
be seen as unnecessary meddling at this stage and be counter productive for HMG. However, we do need to make sure
that any line is in accord with our more general messaging on Climate, Change I Green Energy in the US, as well as being

_
supportive of opportunities for British companies.

Happy to discuss further if needed.

Yours

_eu Coordinator and Outreach Officer, North America Team, WH2324, King Char1es Street London SW1A 2AH.

"Visit our blogs at www.fco.gov.uk"

From:____
Sent:~
To: -

Subject: FW: Roricla: Possible Special Session on Oil Drilling

..
Importance: High '

Grateful for you t1:> co-ordinate the bits in red below. I want to send something back to
Miami & Washington today please.

Regards,

12/07/2010
.K.~: r 10flW1: rO:;:;1UU:: "p~l;Ul1 "~:;:;10ll U11 UU .LJnumg Page 4 ot:> .

DSC & Team Leader, US Section, Americas Directorate, WH2.324, King Charles Street,
LO,ndon, SWlA 2AH .. . .. ..,

From:
Sent: 12 May 201014:16
To: .

Cc:

~"willdo. _.

. Sony for not forwarding on bUt my home email doesn't have your address. Can I leave you '.. to pass this and Nigel's
comment on to others in London and BP as necessary' wrap up into the Gulf distribution. This morning's news described the recall as
"could happen" which I am pretty confident meanS will happen.

... Fro~Nigel Sheinwald

Sent ~IO 22:07
To: .

.. and we'd better have a UK line. N

Da~:/:I)1~. II ¥aY~010 22:01:07 -0400

Snb'Ject:'i"loridi: Possible Special Session on Oil
Drilling From:
To:

12/07/2010
Re:Florida: Possible Special Session on Oil Drilling Page 5 of5 "

Comment

..
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12/07/2010
 From:
Sent: 13 M.ay 2610 16:31
DL Washi Private Office (Restricted)
. . Page 1 of3

To:
Cc: Dominick Chilcott * (Restricted); energy

Subject: update

Nigel,
.. You'll want to be aware
of four energy developments:
.
1. UK Energy. Policy. Under Liberal DECC SoS Chris Huhne, ~nergy policy is becoming clearer.
The main difference between LD and Tory manifestos is support for civil nuclear. Huhne said on
BBC R4 today (transcript below) that LD's would not oppose existing Govt plans for new nuclear
in Parliament, if the industry could demonstrate that nuclear was viable witholit new subsidy
(which he said remained to be seen).
. ..,#1
2. Renewables and Energy Efficiency. Huhne said it was "scandalous" that the UK had not done
more on renewables (wind"marine) or on.energy efficiency. He also said HMG needed to do more of
both, to saVe ~oney but also to make the UK more secure, and less .
dependent on imported energy. .

3. Gulf Oil Spill. BP say they hope that the latest containment vessel to cap the main leak will be
tested and operational over the next day or so, but reiterated their caution about its
initial success.' State Department have confirmed to us that Coast Guard may need
more ocean boom. We've asked London (CO) what we might have to offer. Canada, Norway and
Japan are also considering.

Energy attach'. British EmbassY, WashIngton

3100 MassachusettS Ave. NW 20008

From: News Team Washington [m~ilto:newsteam.washlngton@gmall.com] Sent:

13 May 2010 13:05
.

12/07/2010
 Page 2 of3 .

-, ,

Subject:'i1uhrie interview with BBC :tod~y programme" i3: May

2010 ."------------ .....

TRANSCRIPT

Programme(s) . BBC Radio 4 Today

'Date & time Thursday 13 May 2010 08.38
--
SubjecVlnterviewee \ Energy policy - Chris Huhne
t"
Justin Webb, presenter: ChriS'Huhne th~ Energy Secre(ary is on the line. Good morning to you.
Chris Huhne, Secretary of State for Energy and Climate Change: Good moming.
JW: Are we going to get new nuclear power stations or not?

CH: Well that will be entirely up to the nuclear industry in the first instance because they have to decide
whether or not they're able to build nuclear power stations without new public subsidy, and thafs the key.
JW: And if they say they can?
CH: Well they do say they can but that remains to be seen, because no new nuclear p.ower station has been built without new
public subsidy for a very, very long time, so the answer to your question is 11m afraid you have to ask the industry rather than me...
JW: But just to...
CH: ...because, they're the ones.that would be committed to this.

JW: But if they do come up with a plan, a feasible plan that says we don't need public money to do this, then
your objection is then put to one side?
CH: If they come up with a plan which genuinely Involves no public subsidy, and that's the agreement of the coalition Government,
that's... and I think frankly a very credible agreement In current fiscal circumstances, then they \VIII put it through the normal
national planning process under a new national planning statement, thafs in the agreement, and the proposal will go forward In the normal
way, and we are committed In the Uberal Democrat side of the coalition that we will not vote against that. So If there Is a majority in
Parliament in favour of a particular proposal, and there are an awfullat of 'its' here, then new nuclear will go ahead.
JW: But still... yes, well, that's the important point, isn't it, that it is possible at least that you as Uberal Democrat and as
Energy Secretary will be the person who sets.in train the process that/eads to the building of nuclear power stations, and to
an awful lot of Uberal Democrats thafs going to be horrific.
CH: Well this is a coalition agreement which has always involved compromise on both sides, there's no doubt about that at
all.
JW: Irs a pretty big compromise for a lot of people, though, isn't it, who are opposed to nuclear power, not jLlSt on
cost grounds but.on safety grounds, on a whole range of grounds.
CH: Well it is.....J mean, there are a whole series of compromises which have been struck in this agreement
which' J think are obviously unpleasant for each of the parties, but what we have in exchange is I think a real positive chance
to reshape British politics and to make sure that the recovery keeps underway, and to tackle this looming problem of the
largest budget deficit in Europe which we've inhenled from the Labour govemment, and that enormous gap between public
expenditure and tax is somethIng that actually desperately needs to be tackled in the national interest if our 'recovery is to
keep on track. So I don't think you should be... I mean,

12/07/2010
SUMMARY
Oihleak abated, but continues to threaten Gulf 'States and eastern seaboard after
entering a "loop current". Oil could reach Florida's beaches within a week, with
obvious consequences for tourism. BP's $625 costs to date,> with its share price
down 20% since 20 April. The-spill continues to lead the US media, and political
pressure is increasing tension between BP, the Administration and Congress.
.President Obama has announced independent commission to inv~tigate the causes.
US Department of Interior has spflt leasing and revenue from safety, .and plans to
draw on UK experience post Piper Alpha~ Regulation almost certain to be
tightened,'but existing production continues and the incident has not effected on
global oil price. BP emphasise they ,are doing everything they can, but total
liability costs.and reputational damage win be significant. .

1. The Oil Leak. BP teU us. their first priority is capping the weU, and confirm that
they have suCcessfully installed a .pipe into top of the well, which is .<:!irecting ro-
5,OOO bpd of the main leak to storage on the surface. BP is cautiously optimistic that
this method can progressively capture almost of the leaking oil. They expect
preparations to start overthe weeke~ to seal the well permanently, by injecting mud
into the well at high pressure. BP also continues parallel efforts, including relief well
drillingF_to fill
the well from underground as a backup plan, in case the. former are not fully
effective. .
2. Contrary to claims by prominent US scientists suggesting that the "spill must be
far larger," and up to 100,OOObpd, BP disputes the methods used, and while they
admit that the leak is more than the captured 5,OOObpd, have not agreed a new
figure. In line.with BP's environmental spill plan (consistent with US Interior
Department requirements), booms, dispersant and in situ burning efforts have been
maintained, with some success. The State Department is still considering our offer
of dispersant, but say that for now the US Coast Guard's current supplies appear to
be sufficient. .

3. The oil continues to hit many of the islands off of the Louisiana coast, but has not
yet reache~ the beaches of Alabama or Mississippi. In Florida, the Coast Guard
confirmed that tar balls on the beaches had not originated from the incident, but the
result of standard shipping discharges. Containing the spill will now become more
difficult, h9wever, now that National Oceanic and Atmospheric Administration have
. confirmed oil has entered the Gulfs loop cum~nt. I~ has been estimated that oil could

now reach the South Florida coast by 27th May. In response to poteotial demands
from State Attorney Generals for swift reimbursement, BP have already provided .
$170m in grants toLouisiana, Florida, Mississippi and Alabama ($100m contingency
efforts and- $70 promotion of tourism), but the potential loss of revenue from tourism
and trade in the Gulf are unknown.

. - . t :. . . .~..........................................- eo: -. - - I .
I..
_. A pubJic campaignjn the US has beenlaunc~d. on Facebook called
Boycott BP. So far, BPhas spent $6.25m on the overall response. Their share price
has fallen 20.% since 20 April. The Financial Times estimates $3.9bn cost for
cleanup, but the longer term impact on BP is uncertain.Jndustry sources suggest that
combined losses (estimates hover around $15cn) and a further reduced share value
could make them an attractive target for buy-outltakeover.

5. Current riability. Secretaries Salazar (Interior) and Napolitano (Homeland

Security) have written to BP CEO Tony Hayward, seeking confirmation that BP
would waive the current $75m compensation cap, as defined in law, and that BP
would indeed pay "all legitimate claims". BP have told us that they will r~plying
formally, agreeing to pay aU legitimate claims. BP have already paid out $.12m in
claims.

6. Future liability. Despite BP's assurance that they would pay all legitimate claims,
two attempts this week by Senate Democrats to increase oil firms' future spill
liability
(i.e. raise the current cap of $75m) have stalled, despite public support from Obama.
They were opposed on the grounds that they would unfairly advantage large oil
companies by pricing sman companies out of the market. More than $12 million in
claims have already been paid by BP, who are preparing for moFe Congressional
hearings next week. ...

7. Administration.. This -Aeek President Obama announced the formation of an

independent Presidential commission, to look into deep water oil industry practices,
rig safety, and the associated regulation. It may. follow on directly from the joint report
by DOllHomeland Security into the causes of the incident, due to report to Obama
on 28 May. The latter report wi1l also set out the extent of liability attributed to \
cean_(rig own_~ Halliburton (servicecompnycementer).

:f,... ..
8. F.Ollowir~g recent.public revelationsabout BP lobbying the Mineral
Management
SeNiee (001) to waive environmental inspections of the Deepwater Horizon
platform, a senior MMS official has already asreed to retire earty and Salazar
announceq this week that the MMS would bELSCI"'" . .- . . ..
ey'naV~sKea us to share ourexpeiience~following' the:Piper
Alpha d-isaste?and the subsequent reorganisation of UK offshore oversight
and safety t6 help inform their future plans. W,e have put MMS in contact
with DECC and HSE.
Next Steps
9. The story remains headline news in nation;:!1 media. While the leak continues
and the spill grows (hitting island shoreline) so does pressure on BP and the
Administration. Political rhetoric and increasing pressure from' Congress is also
escalating tensions and between the two, as attention shifts from containment efforts
towards blame and liability.

.,:-
":-::,
'. ~ "'"
 10. "Production from existing Gulf platforms is unaffected, and the
spill any apparent eif~~t onjJlobal oil prices, which remain at -$70 a
barrel

",'
/

# .. J
- ..

w
 Page 1 of2

From: _
Sent: 21 May 2010
15:37
To:
Cc:

Subject: RE: Rep. Gutierrez statement on

BP
Follow Up Flag: Follow up
Flag Status: Red

8
Many thanks. As we discussed, it'd be very helpful to have a fuller .<;!Lscussion about
what this (and other instances of BP, rather than just industry, bashing, and links to
Britain and British business in Congress, press and in.the affected States) as part of
DHM's BP
meeting next week (TBC). I:.e asked _toimtite you as well as other PECG colleagues.

You kindly agreed to follow up with Chicago and. investigate what else has been said on.
this point in Congress.

Press and DG colleagues are also looking out for specifically anti-BP and anti-British
sentiment in the media and more broadly.

!!!!!!!6. British Embassy, Washington

3100 Massachusetts Ave. NW 200118

, i,
Fron): .
Sent:" 21 May 2010 14:58.. :"'.
To:__._
sub~tementon BP
_- from time to time I search the Congressional Reoord for references to the UK. Found this one from

. Wednesday:'
(Mr. GUTIERREZ asked and was given permission to address the House for 1 nUnute and to revise
and extend his remarks.) ,
Mr. GUTIERREZ. Yesterday I urged my colleagues to stop drilling leases from going to BP. We need action ..~
.

now. If Congress can stopBP from receiving government leases, then BP can and should stand for Banned~;:~.
.....................................................................................................................................................................................................~:-:-¥
-''<1
~
12/07/2010
 Page 2 of2

Permanently.

But why stop here? We must go further. Today I Ul'ge my colleagues to Join me to cancel all Federal contracts with BP.
How much money are we talking about? In 2009 alone, the Department of Defense paid at
least $1.5 billion to BP-$1.5 billion with a B. In other wC?rds, big profits for them. .

We need to audit and to stop our taxpayer dollars from going to BP, a company pumping millions of barrels of black
poison into our water and towards our shores. Let's ban permanently BP's black poison and eliminate BP's big profits along
with their British pollution.

...
#

<..
12/07/2010 '-or';';
 Page 1 of 1

From:
Sent:
To:
Cc: .. ;
Subject:

. .......................... -.......

.'JM

... ..........

I read"'-recent'report and noticed that Rep. GUTIERREZ tried to link the . BP

si~ritish pollution. " Is there discussion about taking some steps to distance ourselves from
the problem or mount a media response campaign? .At present, we're in a "m.onitor only"
mode but do respond to questions if asked (using
ap~roved lines). If we need to ramp up activity, we can.

~ommUnications .
Politkal, Press & Publk Affairs .
British. Consula1e-Gener.1ll Houston

.for more information elbout the UK'visit: www.ukinusa.fco.lIov.uklhouston

'and our blogs at http://blolls.fco.lIov.ukI

24/071201
0
 Page 1 of 1

From:
Sent:
To:
Cc:
RE: SUBMITIING:QN THE OIL SPILL
Subject: ... .,

We spoke. We'll absolutely keep an eye on timing and content to help inform the update for
-
Lord Howell there's a hearing tomorrow that might provide an early insight, and I'll
also see what can be gleaned from conversations with US 001 and BP.
The President has named an independent Commission to look into the incident, as well as
oversight of all offshore production. So final answers on liability and what it means for US

produ~tion aren't likely until that Commission has reported (in 6 mOllJhs' time).

. You'll see that_ has already given OECC a steer on how their Ministers might playa
. part (and ~ns~~mg we're joiJ:.ed up). .. :: ,

We'll also let you know the outcome of our cross network meeting on Wednesday.

.I'll continue to discuss with_ in the first instance, but will aim to have another quick
call as per your sugge~tion over next day or two.

Subject: SDBMliTING ON 1l-IE OIL

SPILL
eere encoU~ging us to submit on the oil spill. There's an Administration report on the causes due out on
28 May. I think we shol,lId aim to have something in weekend boxes at the latest, highlighting that it's coming
before it hits the press. Would you be happy with that?
We can also highlight what we think are some of the longer term possible implications.
So grateful if Washington could keep a close eye on timing an~ anything they can glean on content. Will BP
.""et an.l8SI1
y copy?

." ' , ,

12/07/2010
 Page 1 of2

I
From: i.' "" .......................... L

Sent: _ 26 May 2010, 1;2:3.1

To:
Cc: ~
Subject: __ - R~~___ For a~~n Oil spili Submission
Follow Up Flag: FolloW up '-- -

good for
_
Flag Status: Red

Thanks
us to be aware.
will do; Nor ~ure Cuba situation is sufficiently top level just yet, but
_

Will'call-if in a pickle.
~--
~, British Embauy, Washington
3100 Massachusetts Ave, NW 20008

Hi_ .
As discussed here's the latest version of the sub. _
now won't get a chance to look at it until tomorrow
and we will su~~~after$he has clea~ed it. Theref'O're,"grat~ful if-¥ou wouldn't send this up to Nigel until"
has approved it (I.e. probably not until tomorrow when he will have left the office unfortunately).

Secondly, as dis9ussed:could you watch developments today and add in any updates you feel should go in?
r have already added a couple of points that I think are worth adding (including your point on the Texas accident) but you
might want to think about the Venezuela/Cuba issue and if you want to get that in if the
- situation de"el~ps - I've only just read the email from_

Happy to discuss if you've got any questions.

Thanks

,
From: ay
Sent:, :.
To:
Cc:

12/07/201
0
 Page 2 of2 .

Hi_

I've produced the attached submission as agreed. OECC and Post have cleared this. Lord Howell's office havl'l said t~at if
we get it up by 3pm tomorrow, he'll see it that day (no boxes to take home and he's not in on ~~ .

-
As we discussed yesterday,l'i::I appreciate your comments on this draft does it cover what you wanted, is the structure
right etc. I can then send to Washington to update overnight with any latest developments (and check theire happy with the
bits I've added - highlighted in yellow), with a vrew to submitting tomorrow morning.

Happy to discuss.

Many thanks

___,
~
Policy Officer US, India and Canada
Team Climate Change and Energy Group I Foreign and Commonwealth Office I King
I
Charles Street I London I SW1A2AH .

Read our climate blogs: htIn:Jlbloos fco cov uk/mller/cllmatel

;'.~:'..-.
Please consider the environment before printing this email

...

From.: _ _n___
Sent: 25 May 201009:38
To: ~ -

_
SUb~: Ri:'~UBMITTING ON THE OIL SPILL
.\.. .~. . .~
_- Tl'anks. We've discussed and agreed that a weekend submission makes sense.

."
.From:-----------------'
. ~l1t:.~
To:

~were encouraging us to submit on the oil spill. There's an Administration report on the causes due out on
28 May. I think we should aim to have something in weekend boxes .at the latest, highlighting that ifs coming
before it hits the press. Would you be happy with that?

..
We can also highlight what we think are some of the longer term possible implications.
So grateful if Washington could keep a close eye On timing and anything they ~n.glean on content. Will BP
get an early copy? .

12/07/2010
 . Page 1 of 1

-,

26 May 201016:56

_
Dominick Chilcott * (Restricted)
-"-------------------------------------- - _.~

RE: rough agenda for oil meeting

this.aftemoon
Dominick,__
1. As pro~ha~e spoken with
'-,.i .

. -.."-" ...-----.------.

I tainted, as opposed to oil companies In general. : -.,.,.

.. .!I,

From:_____
Sent:~
.. . t

To:

..
'.
(cc. all)."... ..
". .
r~@lmeetingthls afternOO~'

'.. \
Rough agenda for meeting \his afternoon (15.45), with suggested lead~ in
-p'. ~ \ ,~. " :.~'.' . ~ t

brackets. Perhaps_co\l1d also send aroUnd call in details please?

.. .
1, State-level perspectives
.2~.Press/media latest_ _ .. ... "
~:PolitiCs - anti BP sentiment and wider 1mpatt on British business and HMG (all)
4. Administration, esp DOl.,. State._ .
5.~P - PR and liability ......................... .'
6. Informing london an~ers_

--
7. Next steps (all) '-'-'- - . '-.,

WII.J \-.

~. ~..,
\
.' Ii. t
~e, BrItISh Embas4y, Washington
31OCUJlassach!lSetis Ave,'NW 20008

~
.\

I
I
-...... ~
IW.
09/07/2010
From:
Sent To:
Su~ject:
energy: Gulf spill latest

'.:.i," ;"

Many thanks,_ Will do. Enjoy the long weekend.

From:
Sent: ".
-,
To:"
c;c

-~
. Subject:

, Thanks for farward.i.ng the :grar1\on as'~ did not come through our usual system.
This came up in over breakfast with Senator LeMieux's Regional Director this morning.

.
I leave you tQ tactor that ~offer" i~to any briefing for Nigel's meeting with Haywood next
week.

Kevin
From:
Sent: To:
Cc

Subject:

Dear all,

Further to yesterday's egram, I wanted to update you on a few thinks before the Bank Holiday
weekend:
1. BP's "top kill" effort to seal the ~ell was suspended temporarily yesterday, but has since resumed. US Coast
Guard has said the technique" has stopped the oil flow, but the challenge will be to sustatn it. BP tell us they
wont be sure of success for another two days or so. They rem~in cautiously
optimistic. The spill leads the US media again today, for the 38th day.

2. The Ambassador's call with BP CEO Tony Hayward has been postponed until next week.

""::"j

~
. .
3. As foreshadowed in the egram, the.initial Us. DOl/Coast Guard investigation into the incident's
causes produced a report that has gone to the White House. 001 tell me that they don't expect the report's
conclusions to be made pubHc, but are likely to be folded into the Presider-lt's Independent
Commission (to report in 6 months).

4. Local hearings into the incident continue, as does investigative media reporting. Cementing failures are a
recurring theme. BP tell"me that their internal investigation has suggested multiple failures of equipment
and technology, but that it is too early to take a final judgement - everyone.is

5. Whilewith
dealing the only
President
partialextended themoment.
data at the moratorium for new deep water drilling permits for another 6
months, late yesterday he and Interior Secretary Salazar addressed the concerns of shallow water
drillers by allowing permits for drilling activities in waters of less than 500 feet. Existing deep water
production in the Gulf will continue, however.

6. A submission on the,spill went to Ministers over the weekend.

We will aim to report again early next week.

Enjoy the long weekend. ..,
...
t

8!!&, British Embassy,

WaShi~n
3100 Ma5$achu$f/tts Ave, NW 20008

L
From: eGram Gateway (Conf)
Sent:
To: ~'. . ~ to stop the Gulf oil leak permanently,
Subject: as Obama signals tlghter:Id=4591895

Scientists estimate th,at the Gulf spill is the largest in US history, approximately double that of Exxon Valdez. BP begins
their attempt at a "top kill" to stop the leak permanently, but final results. won't be known until late Thursday. In the face
of intense pressure to have the leak stopped and make t~e clean up more effective, President Obama tells a news
conference that the Administration have been the decision-takers on the relief effort from the beglMing. The
President also signalled that future oversight of the safety and environmental . aspects of deep water production
will be .muchtighter, although final conclusions will only become apparent once the PresIdent's Independent
Commission reports in six months' time.

From WASHINGTON
Precedence CONFIRMATION 6251/10
eGram No. 28/051201009:14:00 GMT
Despatched

Efforts to contain the leak and stop the spill

1. Oil.continues to spin into the Gulf of Mexico from BP's Macondo well, with only partly successful containment attempts
earlier this week. The spiH continues to dpminate all US med.ia. BP now aim to stop the leak permanently by canying out a "top kill"
operation. This would cap the well by injecting mud into it at high pressure. The process was given the go-ahead by the US Coast
Guard and BP CEO Tony Hayward on Wednesday evening, and the manoeuvre continues today (Thursday),

2
2. Early signs indicate that the operation goes well, but whether it'has succeeded will not be known until late Thursday evening
(Eastern Standard Time). A successful operation would mark a tuming point for BP and Hayward, who has been pilloried for the oil gianfs
handling of the disaster. BP, whose shares rose 6% today, tell us they are cautiously optimistic that it will succeed. BP also continue with parallel
efforts to drill two relief wells, and stand ready with other temporary
ideas to contain the leak if "top kill" fails. .

3. Meanwhile, (;10 Thursday, a team of U.S. scientists raised the estimate'of how much oil has already leaked between -
17-39 million gallons. The figures signal that the disaster is probably bigger than Exxon Valdez, two decades ago. If
accurate, this would make this oil spill the largest in US history. .

4. Along the Gulf coast, booms, dispersant and in situ burning efforts continue to be deployed by the Joint Command, with
some success. BuUhere has been a sharp increase of the visual effects of oil damage to the local environment and
wildlife over recent days. BP and the Coast Guard have also come under pressure for mal-coordinated clean up activities
along the Louisiana beaches. The slick has not yet reached the beaches of Alabama, Mississippi or Florida.

President Obama's news conference

5. In a press conference Thursday aftemoon, President Obama emphasised that, while BP was responsible for cleaning up
and paying for the disaster, the company was, and had to, clear all its actions with the federal government He also
emphasised that the "brightest minds and most advanced technology in the world" was being brought to bear on what was
"the largest effort of its kind in US history". The news conference was a deliberate attempt by the President to respond to
poor opinion polls and criticism of his Administration's handling of the disaster, typified by conflicting messaging from the
US Coast Guard and the Secretary for the Interior last weekend. Obama was demonstrating he was in control and on the
front foot, before travelling to the Gulf of Mexico on Friday.
.,
6. Obama vowed to put in place tougher environmental and safety regulations for deepwater production, saying that "the oil industry's
cozy and sometimes corrbpt reJationship with government regulators meant little or no regulation at all". The president spoke shortly
aft~r the Obarn~appointed Minerals Management Service (MMS) Director Elizabeth Birnbaum
resigned from the offshore drilling agency. Over recent days, senior (political) appointees at DOl have used the incident to accuse the
Bush regime of being the cause of the "corruption" and generally poor performance of MMS over the past decade. .

7. The President also said that he would extend the moratorium. on new deep offshore drilling operations in the Gulf of Mexico, and
suspend pending lease sales in Virginia and the Arctic. The latter decision is a major blow to Shell, which had an ambitious oil-
drilling programme planned in the Chukchi and Beaufort Seas off Alaska this summer. Shell had told us that they were hopeful that their
plans in Alaska would be able to go ahead, because of the lower risks than those invorved
in deep water. drilling. But the Administration is being deliberately cautious, and Shell seems resigned to its fate in the current
circumstanCes. BP's Washington office was entirely. taken up with the relief effort and preparing for further . Congressional hearings and
press conferences; as such they were not able to tell us if the Administration's latest proposals would affect their deep water plan's.

Ne Ste s
8. e will report further tomorrow on:
the succeSs or otherwise of the "top kill" operation; and further details, reac ons an implications of the Administration's interim review into the
incident, delivered to the White House today, and future US offshore oil and gas policy.

Chilcott

[Contact for this eGram:

...
Addressing

3
 Page 1 of2

From: Sent:
To: 28 May 2010 15:45
Cc: Subject: . DL Washi CCET
Importance: (Restricted)
FW: Staying in touch
High

Team,
See r~uest below. If in doubt ask me first.
... pis fwd all your BP updates direct to Nigel's BB.
Thanksl

From:
Sent: 28 MaYLOin
15:26
To: - -
t

From: _
Sent: 28 May 2010
14:47 To:

Dear
all,
Nigel likes to be kept in touch with key issuesl breaking news (see below).

I will be out of DC till Wednesday so please BB him directly on any urgent updates or breakingl important
news stories. Please keep in mind his upcoming meetings (Tue- Thu).

Otherwise most things should be run through Dominick in the first instance or if that is not possible then they
can be .put in next w/e's box. .

Key issues fOr Nigel, of which you are already aware:

> major USG issues

> Govnt statementsl policy moves

> economy

> oil spill

> Af/Pak

12/07/2010
 _
Page, 2 of 2

Thanks and have a great Memorial Day w/e.

British Ambassador

- ~hingtol1

......'t,.. .,

'

. .-
.. .-- .~.

12/07/2010