WRAPUP 2-BP scrambles to cap flow as oil closes in on marsh

* Installation process still ongoing late on Friday

* Obama lashes out at companies involved in the spill

* Government approves use of subsea dispersants
(Undersea dispersant approved; oil seen closing in on marsh)

By Steve Gorman

PORT FOURCHON, La., May 15 (BestGrowthStock) – Energy giant BP
scrambled on Saturday to make good on its latest attempt to
contain oil from a ruptured wellhead in the Gulf of Mexico as
the government approved the use of dispersants underwater, at
the source of the seabed gusher.

With crude oil pouring unchecked from a blown-out well a
mile (1.6 km) deep on the floor of the Gulf, London-based BP
(BP.L: ) was struggling to guide robots to insert a narrow tube
wrapped in a rubber flange into the 21-inch pipe spewing the
oil — and to funnel that oil to a drill ship at the surface.

“That work is currently underway and we hope to begin
operations overnight,” BP Chief Operating Officer Doug Suttles
told reporters on Friday afternoon.

Seeking new tactics to curb the volume of oil reaching the
surface, the U.S. Coast Guard and U.S. Environmental Protection
Agency early on Saturday said they had authorized the subsea
use of chemical dispersants at the source of the leak.

Dispersants are designed to break the oil into small
droplets more likely to sink to the sea floor.

Some environmental groups and the Gulf’s shrimping industry
have raised concerns about effect of the chemicals, saying the
oil might not sink all the way, but become suspended in the
water column and ingested by fish and other wildlife.

TIME RUNNING OUT

But a statement by the EPA and Coast Guard sought to allay
those fears, saying dispersants are “generally less harmful
than highly toxic oil” and biodegrade more quickly.

“Preliminary testing results indicate that subsea use of
the dispersant is effective at reducing the amount of oil from
reaching the surface — and can do so with the use of less
dispersant than is needed when the oil does reach the surface,”
the statement said.

Coast Guard Admiral Thad Allen, the U.S. government’s
commander for operations in the Gulf, said cleanup crews would
continue to attack the oil slick using surface dispersants,
skimming and controlled burns.

Further inland, BP contractors assisted by flotillas of
hired shrimp boats continued to string containment booms around
sensitive coastal areas. And National Guard teams with
bulldozers and helicopters pressed on to plug gaps in booms
protecting Louisiana’s storm-battered shoreline to prevent oil
from reaching the fragile marshlands behind them.

Time may be running out on the marshes. Local TV footage
late on Friday from a helicopter flight over Louisiana’s
barrier islands showed miles of oil slick carried by churning
waves being washed through wide passes between the islands
directly toward the wetlands of Terrebonne Parish.

Scientists and shrimpers alike have said repeatedly that
contamination of the marshes, the foundation for the region’s
economy and way of life, would be devastating.

The vast but dwindling marshes are the nurseries for
shrimp, oysters, crabs and fish that make Louisiana the leading
producer of commercial seafood in the continental United States
and a top destination for recreational anglers.

“I want to throw up right now,” said Michael Gros, 51, a
shrimp boat owner and captain from Larose, a town in the La
Fourche Parish of Louisiana.

“I’ve been doing this for 22 years full time, and I don’t
really know nothing else,” he said in a soft Cajun drawl. “If
it doesn’t come into our marsh and ruin our marsh, I’ll be very
surprised. Once the grass dies, it’s gone.”

The energy giant’s prior attempt to contain the oil — a
giant containment dome — failed last week after an
accumulation of frozen hydrocarbons rendered it useless.
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TAKE A LOOK on the spill [ID:nSPILL]

INSIDER TV: http://link.reuters.com/rad93k

Graphic: http://link.reuters.com/teb93k

Breakingviews column [ID:nLDE64C1D1]

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U.S. President Barack Obama on Friday gave a tongue-lashing
to all the companies involved in the spill — BP, Halliburton
(HAL.N: ) and Transocean Ltd. (RIG.N: ). — and said he would not
rest until the leak was stopped at its source.

The spill began after an April 20 explosion on the
Deepwater Horizon rig, which killed 11 workers. It threatens to
eclipse the 1989 Exxon Valdez spill off Alaska to become the
worst ecological disaster in U.S. history.

Estimates of the rate of escaping oil range widely from the
official BP figure of 5,000 barrels per day (210,000
gallons/795,000 liters), adopted by the government, to 100,000
barrels (4.2 million gallons/15.9 million liters) per day.

BP’s chief operating officer Doug Suttles said calm weather
would help the company deal with the incident over the weekend
and into next week.

“We have our best success when the weather is good, and the
forecast for the weekend and the early part of next week looks
very favorable to use all of our tools available to us.”

“Thankfully to date there’s been very limited impact to
shoreline.” Beachgoers in the resort town of Grand Isle, a
major recreational fishing hub, were naturally uneasy.

Scott Gaudin, 45, a former petrochemical worker and
lifelong visitor to Grand Isle who made the three-hour drive
down from his home in Gretna with his wife and two dogs, spent
time on Friday collecting scattered bits of what appeared to be
hardened, black tar off the beach.

Gaudin said he was convinced the greenish-tan foam washing
up along the water’s edge was tainted with oil and he could see
a slight sheen on the surface of the water as the surf ebbed.

“I’ll bet if you tested this, they’d find oil in it,” he
said, rubbing some of the foam in his fingers.

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(Additional reporting by Jeff Mason in Houston, editing by
Todd Eastham)

WRAPUP 2-BP scrambles to cap flow as oil closes in on marsh