Thick oil from BP Plc's Gulf of Mexico spill washed ashore in Mississippi for the first time as tropical storm Alex moved into the Gulf, posing a threat to the cleanup operation.
Alex, the first named storm of the 2010 Atlantic hurricane season, had sustained winds of 45 mph and was about 60 miles west-southwest of Campeche, Mexico. The system was moving west-northwest at 7 mph. Forecasters from the U.S. National Hurricane Center say Alex could become a hurricane in the next 48 hours.
They predict Alex will make landfall as a hurricane on Wednesday between Brownsville, Texas, and Tuxpan de Rodriguez Cano in Mexico, sparing BP's oil collection efforts at its ruptured deep-sea well.
After another rocky week last week, investors will have their eyes on shares of BP, which have been savaged since the oil spill started on April 20. The shares, which fell to a 14-year low on Friday, were up 3.9 percent at 4:34 a.m. ET on Monday.
The oil spill, which began on April 20, has caused an economic and environmental disaster along the U.S. Gulf Coast, threatening fisheries, tourism and wildlife.
BP said on Monday it had hit a spend rate of $100 million a day on its efforts to cap the well, clean up the spill and compensate those affected, bringing the total bill so far to $2.65 billion. BP has set up a $20 billion compensation fund under U.S. pressure.
Russian President Dmitry Medvedev, who heads the world's biggest energy producer, made a proposal for a global pollution fund, into which oil companies would be forced to pay, at the Group of 20 summit in Toronto on Sunday.
He said G20 leaders had asked experts to work on the idea.
Louisiana's fragile wetlands have been hardest hit by the oil but Mississippi had escaped damage until Sunday, although some oil had tainted its barrier islands. Oil has also come ashore in Alabama and Florida's Gulf coast.
Gluey gobs of brown oil and a rainbow oil sheen sloshed onto tourist beaches at Ocean Springs, Mississippi, about 10 miles east of Biloxi, and at a beach used by fisherman that is close to an inland marsh.
'Life As I Know It Is Over'
Mississippi state officials and the U.S. Coast Guard, who said they expect more oil to arrive, were waiting on BP contractors to start cleaning up.
"Life as I know it is over. What are we going to do if nobody cares to act fast enough?" asked Mike Hollings, a local resident who cried as he stared at the oil on the beach.
BP said on Monday a "relief" well it is drilling to kill the leaking Macondo well was closing in on its target.
After progressing at a speed of 1,000 feet a day last week, the relief well proceeded over the weekend at less than 100 feet/day as delicate tests were conducted to try and locate its quarry.
British newspaper the Sunday Times reported, citing industry sources, that BP was on track to plug Macondo in a fortnight, or by July 11, but BP said it still expected completion three weeks later at around August 2.
Shell Oil shut subsea production at two platforms and BP evacuated some personnel from three Gulf of Mexico platforms due to the threat of Alex, the companies said. All five platforms are in deepwater areas of the Gulf, far offshore and on the northern edge of some forecasters' projected tracks for Alex.
The U.S. government estimates that up to 60,000 barrels of oil (2.5 million gallons/9.5 million liters) per day are spewing from BP's damaged well on the seabed about a mile below the surface.
While awaiting the completion of the relief wells to finally plug the leak, BP has been using two oil collection systems to prevent some of the oil from its ruptured well from spewing into the sea.
BP said on Sunday its crews had collected or burned off 22,750 barrels of oil on Saturday.
Equipment going to the leak site this week could raise daily collection to 53,000 barrels, officials say, and a review is scheduled of a system that may boost it to 80,000 barrels.