| HOUSTON, Sept 17
HOUSTON, Sept 17 BP Plc (BP.L) (BP.N) said it
expects to permanently plug its runaway Macondo well on
Saturday, closing the first chapter in the worst oil spill in
U.S. history [ID:nN17187116].
Here are some questions and answers on how things might
play out for BP, the U.S. offshore industry and the Gulf's
WHAT ARE BP'S BIGGEST CHALLENGES GOING FORWARD?
* The spill has wiped about $70 billion from BP's market
value and spurred the company to ditch its gaffe-prone British
chief executive, Tony Hayward, to be replaced by an American,
* BP now faces billions of dollars in fines and penalties
from civil and possibly criminal prosecution by the U.S
government. BP has set aside about $32 billion for spill
liabilities, but experts say that amount could soar for BP and
its partners if they are found criminally negligent.
* BP must defend its dominant North America position -- it
is one of the largest U.S. oil and natural gas producers and
the largest acreage holder in the Gulf of Mexico, which
generates a large percentage of earnings growth. BP could have
trouble finding partners willing to enter joint ventures for
deepwater projects due to a higher risk profile, experts said.
WILL BP TAP THE MACONDO WELL IN THE FUTURE?
* BP has remained mum about its intentions for the Macondo
reservoir, which could hold upward of 100 million barrels of
oil. In coming years, BP could unveil plans to retap Macondo
despite its dark history, said Eric Smith, associate director
of the Tulane Energy Institute in New Orleans.
Especially if oil prices rise, such a plan could gain the
blessing of the U.S. government, which might be enticed by the
royalties that BP would pay to extract the oil, Smith said.
WHAT ARE THE LONG-TERM IMPACTS FOR OFFSHORE DRILLING?
* The Obama administration has slapped a moratorium on new
U.S. offshore oil drilling, spurring some rig operators to set
their sights on other offshore basins like Brazil and Africa.
* The spill has fundamentally recast the risk-reward
equation for drilling in the oil-rich Gulf of Mexico, long
considered a prime target for energy companies looking to
escape the political uncertainty of Venezuela and Russia.
* Deepwater operators are having trouble obtaining permits
for activities that are allowed under the government's drilling
halt. A return to normal is not seen for years [ID:n16256754].
* Delays and regulation could add 10 percent to the
marginal cost of deepwater oil production, and a one-year delay
in nascent deepwater projects could impact global oil supply by
500,000 barrels per day between 2013 and 2017, according to
HOW HAS THE SPILL IMPACTED THE GULF COAST ECOSYSTEM?
* A U.S. government report showed that about three-fourths
of the oil spewed by the Macondo well had disappeared from the
Gulf. But environmental groups warn of an undersea oil plume
that could cause lasting detrimental effects to the Gulf's
ecosystem and vibrant fishing and tourism businesses.
(Reporting by Chris Baltimore; editing by Chris Wilson)