Transocean (NYSE:RIG) Earnings Crushed on Gulf Spill Effects

Earnings for Transocean fell of the cliff to the tune of 48 percent from the same quarter last year, as effects of the BP (NYSE:BP) Gulf oil spill linger, and uncertainty over liability and when drilling in the Gulf will resume weighs on the company, as it does on all with exposure to the oil spill.

Particularly harmful was the oil moratorium, which while officially lifted, effectively remains in place because of the permitting process and time it will take to comply with new regulations put in place.

Net income for the quarter plummeted to $368 million, or $1.15 a share, down from $710 million, or $2.20 a share last year.

Revenue was also down, falling from $2.82 to $2.31 year over year.

While analysts had expected a drop in performance, it was much worse than the expected $2.47 billion in revenue and $1.36 earnings per share looked for.

Costs were a major factor, with an increase in insurance premiums, lawsuits, one-time costs, and retiring debt all taking a toll on the company's performance.

Chevron (NYSE:CVX) Completes Deepwater Well, a Month Ago

Chevron (NYSE:CVX) completed drilling the first deepwater well in North America, quietly finishing the well a month ago, which they had started in May.

They got around the foolish oil moratorium of the Obama administration because the well of drilled off the coast of Canada, about 260 miles from Newfoundland.

According to Chevron, the the Lona O-55 well is the deepest well ever drilled in Canadian waters.

Provinces in Canada get royalties from commodity resources, and that's the case with this project as well, as the government rejected the paranoia which emerged from the BP (NYSE:BP) oil spill in America causing emotion-driven overreaction.

Chevron did say through a spokesman that throughout the operations they were extra careful to make sure all safety equipment and measures were working correctly.

The oil giant deliberately went about the drilling quietly to not attract unwarranted attention.

Chevron is 50 percent owner of Lona O-55, Shell has a 20 percent stake, ExxonMobil (NYSE:XOM) has a 15 percent stake, as does Imperial Oil (AMEX:IMO).

The oil well was drilled by Stena, a Swedish-based company.

BP's (NYSE:BP) Money Should Go to Gulf States Says Feds

While it may seem obvious, and it is, the federal government decided to write a 130-page report on why the Gulf states should be the ones receiving the bulk of the money paid by BP (NYSE:BP) for the oil spill.

It wasn't said, but definitely implied, that there are many people and/or institutions attempting to get a share of the money even though they weren't affected.

Obvious ones are the arrogant so-called scientific institutions and universities who seem to think someone owes them this money just because they exist. Of course it's put in terms that they are the great authorities on the subject.

This of course is sure to be the case with those in health fields and economics as well, who in a time of shortages are attempting to treat BP as if they're a government which they can tap for funds.

Concerning fines associated with the Clean Water Act, which are estimated to end up anywhere from $5 billion to $20 billion, according to Rep. Steve Scalise, R-La, the law must be changed in order to keep most of that money in the Gulf region.

Lawmakers from Louisiana have already introduced bills in the House and Senate to get that part of the process moving.

Mexican States Sue BP (NYSE:BP) Over Oil Spill

The Mexican states of Veracruz, Quintana Roo and Tamaulipas have filed a lawsuit against BP (NYSE:BP) over the Gulf of Mexico oil spill, alleging losses from the disaster.

All the states have coasts on the Gulf of Mexico.

According to attorney Enrique Serna, "The three states have accrued a good amount of damages as a result of the spill." There are expectations the damages will continue to grow, added Serna.

Other companies connected to the oil spill who were also sued by the three Mexican states are Halliburton (NYSE:HAL), Transocean (NYSE:RIG) and Cameron International Corp. (NYSE:CAM).

Serna strangely said that the so-called and unproven underwater oil "plume" will eventually reach Mexico's fishing waters as cold fronts move into the area.

The fictitious plume is just that, and hasn't been found, and was only asserted to exist by some so-called scientist two months before they reported it.

Somehow it mysteriously disappeared and is nowhere to be found, even though it was alleged to be gigantic.

To base part of his case on that is pretty thin and weak, and hopefully will be thrown out by the judge.

BP (NYSE:BP) Legal Hearing, Criminal Lawyers Lash Out

Today marked the beginning of the fourth hearing for BP (NYSE:BP) as well as other companies holding a stake in the Macondo well. The Federal investigators and criminal lawyers are saying that BP was fully aware of the fact that there were extreme technical problems, but did not take any action leading to the April 20th explosion of the Deepwater Horizon.

There is a joint panel combining The Department of Interior and the U.S. Coast Guard. It is the responsibility of this panel to come to a conclusion as to cause of the massive oil spill. One of the main lines of questioning focused on whether there were major equipment failures on the rig, which would have played a part in the disaster.

A shot of natural gas catapulted to the surface from under the seabed, causing the rig to explode. Despite many precautions that are in place and designed to prevent this, the explosion still happened.

In a September 2009 audit done on BP, there were numerous problem found aboard the Deepwater Horizon. Panel member Jason Mathews, questioned BP's top official for maritime safety in the Gulf Neil Cramond, "With all these flaws identified within this audit, do you think it is a fundamental flaw for BP to pay [Transocean, the rigs owner] $500,000 a day knowing that there are all these problems with the rig." Cramond said he was comfortable with how the safety issues were handled.

Gulf Legal Claims Chief: No Sue Rule My Idea Not BP's (NYSE:BP)

Ken Feinberg, the new administrator handling legal claims from the victims of the Gulf said on Sunday that the no sue rule was his idea not BP's (NYSE:BP). Anyone receiving a settlement payout from the compensation fund, gives up their right to sue the company individually.

Feinberg was very clear that he would be far more generous in payments of funds than any court would be. "It is not in your interest to tie up you and the courts in years of uncertain protracted litigation when there is an alternative that has been created," said Feinberg. He continued, "I take the position, if I don't find you eligible no court will find you eligible."

Some of the guidelines have changed, like now the closer you are geographically to the oil spill location, the more likely you are to receive compensation. "I'm going to have to draw some tough lines," said Feinberg. He added that the most "problematic" claims will be from those in the tourism business.

Federal Investigation Hearing Today, Confronting BP (NYSE:BP) and Transocean (NYSE:RIG)

Today there is a Federal investigation hearing where Federal investigators will be questioning BP (NYSE:BP) executives and managers, as well as rig owner Transocean's (NYSE:RIG) Ltd. There is a panel set to hold the hearings, and each company will be explaining disabled safety systems as well as failures of the well design, causing the worst oil spill in U.S. history.

The combined Interior Department - U.S. Coast Guard investigation has already had three hearings. The prior hearings have taken place in Louisiana where a massive amount of testimony has already been heard. This time, the hearing moves to Houston, where there are several offices of companies involved with the disaster, including BP.

There is much significance to these hearings and the federal investigation. If criminal misconduct is found to have been a factor by any or all of the oil companies that played a part, the panel can turn over its findings to the U.S. Department of Justice. Who is currently doing their own criminal investigation.

It is possible that a fifth hearing will take place. If so, it won't be until several key pieces are recovered from the bottom of the Gulf, including the blowout preventer. The hearings are very similar to that of a trial. Exhibits are presented, witnesses testify under oath, and there is cross examinations. The finding will be reported in January.

FL. Asking BP (NYSE:BP) Oil For Another $1 Billion

Florida is currently figuring out the exact amount of damages caused by BP's (NYSE:BP) oil spill. In the mean time, they want an "interim" payment from the company in the amount of $1 billion. The reasoning being to help offset a looming budget deficit for the state.

Some of the losses being claimed are tax revenues, oil cleanup, among other damages. Governor Charlie Christ, Florida's governor, has already secured $32 million for the state since April 20th. The money was used for advertising through various media outlets, including TV and Internet to promote tourism and the safety of their beaches.

"Florida's damages as a state could easily be in the billions of dollars. We just don't know and its going to be years before we know the long term impact from the spill. But in the meantime we'd like reparations to get relief, so we don't have budget shortfalls directly from BP's wrong doing," said Tampa lawyer C. Steve Yerrid.

Texas Bills BP (NYSE:BP) And They Paid In Full

Instead of hearing whining and complaining from states who feel they haven't been adequately compensated by BP (NYSE:BP), Texas billed the company and got paid in full. Something to note also, the bill wasn't excessive and lacked the greed that some of the other states seem to have with the astronomical amounts being asked for.

The bill was for $174,295, according to Jim Suydam, Texas General Land Office spokesman. The charges include personnel and vehicle expenses related to the oil spill. A check was received Monday by the agency. The amount included the amount of $77,500 which was the amount used for fire boom that had been used during the initial oil spill cleanup.

Testing in July proved tar bars that were found on McFadden Beach were from BP's oil spill. Suydam stated that Texas will usually bill a party if scientifically identified. While expenses from an unknown source are covered by a tax in a fund on imported oil barrels.

BP (NYSE:BP) No Longer Accepting Negligence Claims

Jim Hood, Mississippi's Attorney General said that he has yet to decide either way if he will file a state lawsuit against BP (NYSE:BP), because of the damage they have suffered from the oil spill. Hood said, "We're in no hurry to file any litigation."

He said that he is taking the time to fully review potential claims. He is looking for damages caused by the spill. As well as the chemical dispersant used and it's possible long term effects. BP's statics show that Mississippi has filed a total of 9,600 "actionable" legal claims. Only 6,050 of these claims are still being reviewed, that's 63 percent.

On Wednesday August 23rd, BP will no longer be accepting new negligence claims. Kennith Feinberg, the administrator appointed by the government will be taking over and handling all legal claims from that point on.

While BP says they have received a total of 24,493 claims from Mississippi and paid out close to $29.5 million to the state. Hood said that according to the company's statistics, of the 1,062 from rental property owners, a total of 363 were paid. While 213 claims were made by restaurant owners and only 53 were paid out, and 30 of 695 claims were filled for boats.

BP (NYSE:BP) Gives LA. $15 Million For Mental Health Counseling

BP (NYSE:BP) is giving Louisiana $15 million to the health department. It is meant to be used to provide mental services for those people effected by the worst oil spill disaster in U.S. history.

Governor Bobby Jindal's office said the money will be used to help pay for clinical visits, counseling, support services, outreach, and medications if needed. This was announced Monday at an event with the governor.

A minimum of $6.6 million will be distributed throughout Catholic Charities and other various non-governmental organizations. The rest of the money will be used to pay for state related services, and the regional human services district.

Jindal had originally asked BP for $28 million to pay for mental health services. These services would be distributed over a 13 month time frame in the regions affected by the massive oil spill.

LA. Shrimpers Begin Harvesting, BP (NYSE:BP) Oil Still A Concern

Shrimpers have returned to Louisiana to begin their harvesting season, but there are still concerns about the BP (NYSE:BP) oil that may have effected the shrimp. They are not for sure the price they will get if consumers are concerned about contamination, among other possible effects.

The massive oil spill has effected fishing as a whole in a state that ranks first for its shrimp, oysters, blue crab, and craw fish. It's a $318 million industry in Louisiana annually. Fisherman have already seen the prices crash in the Summer by scared consumers who stopped purchasing their products.

The biggest fear is that fisherman may try and sell oily seafood. A shrimper from Buras, Dewayne Bayham said, "If you see oil shrimp you got to throw them back over. Go somewhere else. It's all you can do, and you hope everyone else does the same."

On Friday, several fisherman did a test run around Grand Isle and Barataria Bay. Several areas were tralled and than the nets were pulled up revealing shrimp, jellyfish, mud, and driftwood. None of which contained any smell of oil. To reopen harvesting, the Food and Drug Administration has set levels which have to test below 12 various potential cancer causing substances.

BP's (NYSE:BP) Financial Compliance, Will They Pay

The top energy advisor for President Obama stated that BP (NYSE:BP) will be paying a "large financial penalty" for the oil spill in the Gulf of Mexico. The question remains if the company will take on their responsibilities and show financial compliance. He would not say as to whether criminal negligence charges were going to be taken against the company.

BP is now in the process of shifting from stopping the oil leak, to cleaning the oil that has polluted beaches and restoring economic health to the region. Director of The White House Office of Energy and Climate Change Policy, Carol Browner stressed that BP is anything but off the hook for the billions of dollars of penalties they will incur.

"BP will be held absolutely accountable. There will be a large financial penalty," said Browner. There has been over 205 million gallons, or 4.9 million barrels of the toxic crude oil released into the Gulf region. While about 800,000 barrels were able to be collected, contained, and funneled to ships on the waters surface.

BP (NYSE:BP) Oil: Static Kill Success, On To Relief Wells

BP (NYSE:BP) engineers appear to be successful in their static kill attempt. Cement was poured in to the top of the well, which is supposed to hold down the mud at the bottom of the well. Now they must wait at least 24 hours for the cement to harden.

The static kill process started on Tuesday with crews pumping thick mud down the well to push the crude back underground. With that success, the next step was to pour in the cement. The final step once the cement hardens is for the engineers to inject more mud and cement into the bottom of the well, creating a permanent plug.

So while we are starting to shift from one aspect of BP's disastrous oil spill to another, there is still much to be done. According to a new report issued by the Interior Department and the National Oceanic and Atmospheric Administration, there is still almost 53 million gallons of the toxic oil polluting the Gulf shores.

"There is very little observable oil out there. We can't turn a blind eye, if we don't see oil, I'm not assuming it doesn't exist," said Rear Adm. Paul Zukunft.

BP (NYSE:BP) Says Pay: Bills Mitsui $480 Million

BP (NYSE:BP) has billed Mitsui $480 million for their share of the oil cleanup costs caused by the oil spill. Mitsui has not paid and it remains unclear if they actually will or not. The company, "will study and determine whether or not it should pay," said chief financial officer Junichi Matsumoto.

BP's soon to be chief executive officer Robert Dudley, has stated that he has full intentions to "vigorously" pursue the partners. The company has incurred charges of $3.2 billion relating to the leak. Mitsui owns a 10 percent stake while Anadarko owns 25 percent.

Anadarko's stance has remained the same from the beginning, we're not paying. Anadarko's chief executive officer Jim Hackett said, "Under the joint operating agreement, no party is required to pay any cost or damages to the operator to the extent that they are incurred as a result of the operators gross negligence or willful misconduct."

BP (NYSE:BP) Playing Dumb on Oil Spill Estimate and Spill Containment

BP (NYSE:BP) is playing dumb when it comes to the new oil spill estimate. Just a day ago the government increased their estimate of spilled oil to over 4 million barrels.

BP spokesman John Barnes said, "We don't have our own estimate of the flow rate or an assessment of this report." He stated that BP was not part of the federal scientific task force which came up with the estimate. He did say that the company had provided data to the task force. "It's important to know the amount of oil released, but we're not actual participants in that," continued Barnes.

Something is not adding up here, from the beginning of the oil spill BP has been low balling their estimates. Despite what scientists and the federal government have been insisting was the actual, much higher amount. Now BP's lawyers are being hush, hush and not giving any comment one way or the other. The amount of spilled oil is what will determine the amount the company's liability.

The federal clean water act will allow the government to impose the fine. The minimum of which, would be $1,100 per barrel of the toxic crude deposited into the Gulf of Mexico. The fine could go all the way up to $4,300 per barrel if the company is found to be negligent.

BP (NYSE:BP): Pakistan and Vietnam Assets For Sale

BP (NYSE:BP) continues its attempt to raise money to help pay for their massive oil spill in the Gulf of Mexico. The company has told the governments of Pakistan and Vietnam that they have put up their production assets for sale.

David Nicholas, a BP spokesman stated that in Pakistan, the company is planning on selling its oil and gas production fields. They will also sell their deepwater drillling sites, which is the biggest offshore acreage that will be given to a single explorer in the country. In Vietnam, BP is planning on selling its interest in a offshore natural gas field, a power generator, and a pipeline.

So far BP has agreed to sell oil and gas fields in the U.S., Canada, and Egypt. The company has said it plans on selling up to $30 billion of its assets. Nicholas said, the sales "will primarily come from our portfolio of upstream assets around the world, which will be of more value to others."

BP's (NYSE:BP) Static Kill Delayed Due To Debris

The static kill procedure was set to begin today, but BP (NYSE:BP) is saying it will be delayed due to debris from the Gulf of Mexico storm. Thad Allen, National Incident Commander said it's looking like the delay will only be a day hopefully.

On July 23rd, BP had to evacuate all their drilling vessels from the oil spill site to almost 40 miles off Louisiana's coast. Once Tropical Storm Bonnie subsided, there was much sediment that fell inside the wellbore which had to be removed. There is a drilling vessel preparing to install casing into the relief well.

The casing must be installed before the static kill attempt to reinforce the well. This process may cut down on the time it takes to ultimately plug the well permanently. The relief well is not expected to be ready to have the mud pumped through it for at least a few more weeks.

BP (NYSE:BP) Stock, To Speculative To Buy Says Biggs

The Hedge fund manager Barton Biggs, has this month become more optimistic of stocks, but is still leery saying BP (NYSE:BP) is still "to speculative" to purchase. He disagrees with the analyst in a Bloomberg Story who are rating BP's stock at "buy."

With the optimism from BP finally having success in placing their sealing cap and stopping the leaking oil on July 15th, many seem to think that everything is over with the oil spill. In reality, BP has still not reached the desired pressure in the testing of the well. The original target was set at 8,000 - 9,000 pounds per square inch, they have yet to reach over 7,000 pounds of pressure. Not to mention Macondo well has to still be permanently plugged. Yes BP has had a small success, but we must not delude ourselves to the full scope of reality that has yet to play out with BP.

Biggs said, "It's too speculative for me. Are these people down in the Gulf who aren't going to be able to fish, and their business was fishing, are they going to be able to sue BP for payments for the next 20 years ? I don't know, it's to hard to call."

BP has lost almost 40 percent of their stock market value since the explosion and sinking of the Deepwater Horizon, but the company has rebounded 37 percent.

Tony Hayward Leaving BP (NYSE:BP) Oil October 1st

There has been much speculation and rumors surrounding Hayward's leaving BP (NYSE:BP) oil. A source spoke on the condition of anonymity due to the company not revealing their plans to the public yet. He said that Hayward is expected to leave October 1st and resign from the board by the end of the year.

The companys board of directors is meeting this evening, and whether he leaves or not is expected to be the center of their agenda. Hayward's whole career has been with BP. He has stated that he is ready to step down and has become "a liability going forward."

The board is also meeting prior to the Tuesday release of quarterly results. The directors will be discussing the best way to confront or diffuse criticism. While the company reveals its newest estimates of the losses and costs due to the worst oil spill in U.S. history.

Some analyst have said that Hayward's leaving would be a gesture that someone is taking full responsibility. According to another person who spoke under conditions of anonymity said, Hayward is not the only executive that will be leaving. It is expected that other top BP executives will be asked to leave.