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Companies that ferry people and supplies to
offshore oil rigs asked a federal judge Monday to lift a six-month
moratorium on new deepwater drilling projects imposed in the
aftermath of the massive Gulf spill.


      U.S. District Judge Martin Feldman heard two hours of arguments
Monday and said he will decide by Wednesday whether to overturn the
ban imposed by President Barack Obama's administration after the
Deepwater Horizon rig explosion.


      The April 20 disaster killed 11 workers and blew out a well that
has gushed anywhere from 68 million to 126 millions of oil into the
Gulf.


      BP said Monday it has spent $2 billion in two months fighting
the spill and compensating victims, with no end in sight. It's
likely to be at least August before crews finish two relief wells
that are the best chance of stopping the flow of oil.


      The British oil giant released its latest tally of response
costs, including $105 million paid out so far to 32,000 claimants.
The figure does not include a $20 billion fund that BP PLC last
week agreed to set up for Gulf residents and businesses hurt by the
spill.


      Kenneth Feinberg, who has been tapped by President Barack Obama
to run the fund, said many people are in desperate financial
straits and need immediate relief.


      "Do not underestimate the emotionalism and the frustration and
the anger of people in the Gulf uncertain of their financial
future," he said.


      Feinberg, who ran the claim fund set up for victims of the Sept.
11, 2001, terrorist attacks, said he is determined to speed payment
of claims.


      Shares of BP, which have lost about half their value since the
rig Deepwater Horizon burned and sank off the Louisiana coast, fell
nearly 3 percent Monday in New York trading to $30.86. The rig was
owned by Transocean Ltd. but run by BP.


      BP chief executive Tony Hayward canceled a scheduled Tuesday
appearance at a London oil conference, citing his commitment to the
Gulf relief effort. The last-minute pullout followed stinging
criticism of Hayward's attendance at a yacht race on the Isle of
Wight off the coast of southern England on Saturday.


      Obama's administration has also been struggling to show it is
responding forcefully to the spill. As part of that effort, the
Interior Department halted the approval of any new permits for
deepwater drilling and suspended drilling at 33 existing
exploratory wells in the Gulf.


      But a lawsuit filed by the Covington-based Hornbeck Offshore
Services of Covington, La., claims the government arbitrarily
imposed the moratorium without any proof that the operations posed
a threat. Hornbeck says the moratorium could cost Louisiana
thousands of jobs and millions of dollars in lost wages.


      "This is an extraordinary time for the Gulf Coast. It calls out
for an extraordinary remedy," plaintiffs' attorney Carl Rosenblum
said in court Monday.


      Government lawyers said the Interior Department has demonstrated
that industry regulators need more time to study the risks of
deepwater drilling and identify ways to make it safer.


      "There is a lot the department does not know, and that's
precisely why it's important to conduct these studies and learn
more," said Justice Department attorney Guillermo Montero.


      Feldman asked a government lawyer why the Interior Department
decided to suspend deepwater drilling after the rig explosion when
it didn't bar oil tankers from Alaskan waters after the Exxon
Valdez spill in 1989 or take similar actions in the wake of other
industrial accidents.


      "The Deepwater Horizon blowout was a game-changer," Montero
said. "It really illustrates the risks that are inherent in
deepwater drilling."

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Disasters

Companies that ferry people and supplies to
offshore oil rigs asked a federal judge Monday to lift a six-month
moratorium on new deepwater drilling projects imposed in the
aftermath of the massive Gulf spill.


La. companies ask judge to end drilling moratorium

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