Transocean Shares Holding Despite the Oil Spill

Transocean LTD (NYSE:RIG) shares are holding up well despite the oil leaking into the Gulf of Mexico at a rate of 42,000 gallons per day.  In the last 5 days Transocean shares have only fallen 4%, they owned the oil rig that is now at the bottom of the ocean.

The Coast Guard, BP Plc (NYSE:BP), and the rig's owner Transocean (RIG), have deployed nearly 50 vessels to help contain and clean the slick. Marine life has been spotted in the area. Over the weekend a plane from the U.S. Fish and Wildlife Service sighted five small whales nearby. Crews working to contain the spill were alerted to their presence.

Efforts are also underway near the shoreline to deal with the spill should it reach land, including positioning boom material around sensitive ecological areas. The spill has the potential to be a major disaster if left unchecked, although at its current flow rate would take over 260 days to rival the Exxon Valdez disaster, which discharged some 11 million gallons into Alaska's Price William Sound.

To seal the leak, three approaches are being tried.  BP is now using a set of remote controlled submarines in an attempt to activate the well's "blow out preventer" -- a steel device the size of a small house that sits atop the well and is intended to choke off the flow of oil in the event of a disaster.

It's not clear why that device didn't not originally act to cap the well, or if it will be of any use going forward. BP is also bringing in another drilling rig which could seal the well, but that effort will take months, according to a BP spokesman.

In the meantime, the company is also trying a novel approach to capture the oil -- using a dome right above the well head. The dome resembles an inverted funnel, with a pipe leading up to ships waiting at the surface to capture the oil. That tactic has never been tried in water this deep.

A BP spokesman said the dome might be ready in a few weeks. The blast last week, which is still under investigation, resulted in 11 workers going missing. The search for them was suspended last Friday. 115 other people made it off the rig after it exploded, most of them safely. One person remains in the hospital.

SOURCE: http://money.cnn.com/2010/04/27/news/economy/oil_rig_gulf/