Oil companies start $1bn Gulf spill project

Big oil companies including Exxon Mobil Corp and Royal Dutch Shell will spend USD 1 billion to develop a new oil spill containment system for the Gulf of Mexico, the companies said on Wednesday.

The project, put together in response to BP Plc's Gulf oil leak, will be engineered for water depths up to 10,000 feet (3,000 metres) and have initial capacity to contain 100,000 barrels (4.2 million gallons/15.9 million liters) of oil per day.

The system, which will be available for mobilization within 24 hours, will be used on a wide range of equipment and in varying weather conditions and has the potential for expansion, the companies said.

It will consist of specially designed subsea containment equipment connected by manifolds, jumpers and risers to capture vessels that will store and offload any spilled oil.

Exxon, Shell, ConocoPhillip and Chevron Corp will form a non-profit organization, called the Marine Well Containment Company, to operate and maintain the system. The group will also shoulder any additional costs.

The group will proceed immediately with the engineering, procurement, construction equipment and vessels for the system, with Exxon taking the lead.

BP's Macondo well ruptured three months ago, causing the the worst US oil spill on record.