Court threat piles pressure on BP

OIL giant BP faces further pressure after a US state attorney general announced plans to sue the company over the devastating damage caused by the Gulf of Mexico oil spill.

Alabama attorney general Troy King is seeking unspecified damages against BP, Transocean and other firms associated with the Deepwater Horizon oil rig which exploded on April 20, killing 11 people and causing some 200 million gallons of oil to spew into US coastal waters.

In a statement announcing the filing of two lawsuits yesterday, King savaged BP over its conduct and said there could be no more delay in seeking redress for the people of Alabama.

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"Some will, no doubt, sound the alarm that the lawsuit is premature," Mr King said. "As Alabama's lawyer, I say that if, anything, based on BP's broken promises, their history of saying one thing and doing another, and now, new information that they have been secretly working to gain a legal advantage, further delay can only further damage our people."

Alabama is one of several Gulf coast states to be badly affected by the oil spill, now perceived to be the worst of all time.

But the decision for it to take legal action comes after BP agreed to pay a record $50.6m (32.5m) fine for safety failings at its Texas City oil refinery after an explosion in 2005 which killed 15 workers.

The firm faces mounting costs for this year's disastrous oil spill for which it has agreed a $20bn (12.5bn) compensation fund on top of the bill for the clean up which has already exceeded $6.1bn dollars.

BP recently announced a 11bn loss for the last quarter and said it hopes to sell around 10 per cent of its production assets over the next 18 months, with the aim of raising $30 billion (19.3bn) to beef up its balance sheet to meet the cost of the crisis.

Mr King said thousands of Gulf Coast residents are still waiting for recompense as their claims languish in the legal system, while BP spends millions of pounds on public relations and advertising.

A spokesman for BP – Britain's largest firm – said the company does not comment on ongoing litigation.

But the Attorney General said the lawsuit could be settled if BP should suddenly "do right" by Alabama and its citizens.

"BP is now on notice," he said. "Alabama intends to hold you good to your word and to make you put our state back the way you found it."

The Alabama claim is one of more than 300 federal lawsuits facing the company and others involved in the disaster.

Mr King is the latest American figure to publicly savage BP which has faced a massive backlash in the US. Earlier this year President Barack Obama accused the firm of "recklessness", and called for chief executive Tony Hayward to be sacked. Mr Hayward was later replaced with American Bob Dudley.

Meanwhile efforts to plug the well permanently are continuing. The US Government warned yesterday that although the flow of oil has now been stopped, work on what has been touted as the best long-term solution needs to continue.

The Government's spill response chief Thad Allen said officials were still evaluating the best way to finish the relief well which forms a crucial part of the so-called "bottom kill" operation.

Work on the wells was halted this week because of bad weather and there had been some suggestion that the "bottom kill" strategy – pumping mud and cement into the bottom of the well – could be scrapped

"The relief well will be finished," Mr Allen said yesterday. "We will kill the well."

The flow of oil into the Gulf has been halted since July 15, when a temporary cap was placed over the top of the well. The cap has since been made permanent.

Officials do not yet know the cause of the explosion, or why machinery designed to prevent the unchecked flow of oil failed to work.