WRAPUP 4-BP fails to plug oil well with 'top kill'

* BP not able to stop the flow of oil

* BP moves to next option, one to capture oil

* Blow to BP and U.S. government (Recasts with top kill failing)

By Ed Stoddard and Mary Milliken

VENICE, La./HOUSTON, May 29 (Reuters) - BP Plc (BP.L) said on Saturday the complex "top kill" maneuver to plug its Gulf of Mexico oil well has failed, crushing hopes for a quick end to the largest oil spill in U.S. history already in its 40th day.

"We have not been able to stop the flow," said Doug Suttles, the London-based oil giant's chief operating officer.

"We have made the decision to move on to the next option," he added.

That next option is called the lower marine riser package cap, one that captures oil from the well rather than plug it. Suttles said it could take four days or longer to show results.

U.S. Coast Guard Admiral Mary Landry, flanking Suttles at a daily briefing, said the news of the top kill failure was disappointing and that the best option for ending the spill was drilling a relief well which BP estimates will take two months.

The top kill maneuver started on Wednesday and involved pumping heavy fluids and other material into the well shaft to stifle the flow, then seal it with cement.

But it was fraught with risk because it had never been attempted at the depth of the well, a mile (1.6 km) beneath the sea.

The failure was a further blow to BP's reputation and bottom line. The company has spent $940 million so far to try to plug the leak and clean up the sea and soiled marshlands vital to wildlife and fishing.

The news will also put further pressure on U.S. President Barack Obama, who is struggling to persuade Americans that his administration can handle the crisis. The plodding clean-up effort has sickened workers and left Gulf coast residents frustrated and angry.

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INSIDER TV: link.reuters.com/wuw64k

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The Deepwater Horizon rig exploded on April 20, killing 11 workers and unleashing an underwater torrent of oil that the government estimated at 12,000 to 19,000 barrels (504,000 to 798,000 gallons/1.9 million to 3 million liters) a day.

Obama faced criticism that he responded too slowly and assured people in Louisiana during a visit on Friday that they "will not be left behind" and that the "buck stops" with him.

There is not much Obama can do other than apply pressure to BP to get it right and put his best scientists in the room. The government has no deep-sea oil technology of its own.

This week, government estimates showed that the Gulf spill surpassed the 1989 Exxon Valdez disaster in Alaskan waters. (Additional reporting by Kristen Hays in Houston, Jane Sutton and Pascal Fletcher in Miami; writing by Mary Milliken and Mohammad Zargham)