BP tests tricky oil plug plan as Obama vents

HOUSTON/WASHINGTON (Reuters) - BP <:BP.LO:>Plc began critical testing on Tuesday of its "top kill" plan to plug the gushing Gulf of Mexico oil well as President Barack Obama vented frustration over the energy giant's inability to contain what is likely the largest U.S. oil spill ever.

Five weeks into the unchecked disaster, Obama has told aides to "plug the damn hole" and plans to make his second visit to the Louisiana Gulf coast on Friday.

But before he heads to the disaster zone, Obama is expected to send a message on Thursday to the oil industry of tougher safety requirements for offshore drilling rigs, an official said.

On an Air Force One flight to California, Obama was updated on BP's "top kill" plan in a phone call to Energy Secretary Steven Chu.

Chu gave Obama his technical and scientific assessment of the plan and what the next steps will be if the this attempt fails to stop the leak, the White House said.

Mindful of growing public criticism of its oil spill response, the government has sent its top scientists like Chu into the room with BP to supervise the top kill planning and the alternatives if it fails.

"We are not relying on BP, but we absolutely need their expertise," Carol Browner, Obama's adviser on energy and climate change, told CNN.

"We have our scientists in the room looking at what is being proposed, at what is the next step. And, obviously, these steps are taken only after we reach agreement," she added.

The White House pressure, however, coincides with a new government report that points to a "cozy relationship" between the oil industry and the agency meant to regulate it.

As the gloppy mousse-like oil oozes into critical wildlife habitats and fishing grounds, the U.S. government has few tools or technology to tackle the undersea well blow-out triggered by a rig explosion April 20 that killed 11 crew members.

Equipped with underwater robots, BP engineers plan on Wednesday to inject heavy drilling fluids into the mile- deep well, a complex maneuver known as "top kill" that has never been attempted before at such depths.

Before they try to seal the well, they pumped so-called "mud" into the well head on Tuesday to gauge if the well could be damaged at high pressure and augment the leak.

With the accident and failures to cap the well, BP has seen around 25 percent, almost $50 billion, wiped off its market value, and London shares lost another 1.6 percent Tuesday.

Adding to its woes was an oil spill of several thousand barrels on the Trans Alaska Pipeline, operated by a consortium in which BP is a major shareholder.

REGULATORS UNDER SCRUTINY

Industry experts told the Reuters Global Energy Summit that the top kill plan is "doable" and has a 50-50 percent chance of working, while playing down concerns of a bigger leak.

BP does have other options if the top kill fails, including the installation of a new dome and a new blow-out preventer over the old one that failed in the rig explosion.

The U.S. government did, however, have its own regulatory shortcomings and ethical lapses to answer to after an official report showed regulating agency employees in 2000-08 took sporting event tickets and hunting trips from energy companies and used government computers to view pornography.

Interior Secretary Ken Salazar ordered an investigation into whether the oil rig involved in the spill was properly monitored by the Minerals Management Service.

"This deeply disturbing report is further evidence of the cozy relationship between some elements of MMS and the oil and gas industry," said Salazar in a statement, noting that he has carried out MMS reforms since taking over in 2009.

Analysts say the oil spill could become more of a political liability for Obama ahead of November elections that are widely expected to erode his Democratic party's control of the U.S. Congress.

A CBS News poll released Tuesday showed 70 percent of Americans disapprove of BP's handling of the disaster, but 45 percent give the Obama administration a negative rating despite his administration's efforts to show it is on top of the crisis.

TOP KILL VIA VIDEO

Obama cited the spill when he met Republicans on Capitol Hill on Tuesday and urged them to work with him to pass climate change legislation that aims to reduce U.S. dependence on foreign oil and better protect the environment.

With oil and tar balls from the spill now soiling more than 70 miles of Louisiana's 400-mile coastline, the U.S. government has declared a "fishery disaster" in the waters off Louisiana, Mississippi and Alabama, making those states eligible for special federal assistance.

Commercial fishing, shrimping and oyster harvests have been shut down for weeks along much of the U.S. Gulf Coast, home to a $6.5 billion seafood industry. Louisiana's industry alone accounts for up to 40 percent of the U.S. seafood supply and more than 27,000 jobs.

BP has estimated that about 5,000 barrels (210,000 gallons/795,000 liters) have been leaking every day, although some scientists have given much higher numbers for the size of the leak -- up to 20 times more.

One way of monitoring BP operations is the live video feed of the leak, which BP said it might turn off during the top kill procedure.

But an administration official said BP agreed to make the live feed of the top-kill attempt available at the request of Obama and the National Incident Center.

(Additional reporting by Susan Heavey and Matt Spetalnick in Washington, Sarah Young in London; Tom Bergin and Chris Baltimore in Houston, Pascal Fletcher in Miami, Steve Gorman in Los Angeles and Kathleen Baydala in Jackson, Mississippi; Writing by Mary Milliken, Editing by Philip Barbara)

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