Elgin leak costing US$ 2.5 million per day

Total released a statement announcing that the gas leak at the Elgin platform was costing US$ 2.5 million per day and that it was still too soon to provide an estimate of when it would be stopped.

The daily cost comes from US$ 1.5 million per day in lost earnings and an additional US$ 1 million per day in costs. Stopping the leak is not expected to be cheap either, with estimates for the cost of drilling both the planned relief wells lying in the region of US$ 200 million. Daily costs of the leak would increase to US$ 3 million if the relief well option were to be used.

Despite these unexpected outlays, Total was quick to provide reassurance that the overall finances of the firm would not be harmed.

There is however, positive news with Total’s evacuation of the rig being hailed by the Chief Executive of Oil & Gas UK, Malcolm Webb, as a demonstration of the effectiveness of emergency response arrangements and the safety culture of the UK offshore oil and gas industry.

There had, until recently, been serious concerns over a possible explosion caused by the platform’s flare. These fears have declined in the last few days as the flare extinguished automatically.

Since the leak was reported, Total’s share value has dropped by 6.5%, taking US$ 8 billion off the company’s share value.

Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/04042012/elgin_leak_costing_total_more_than_usd2million_pd/