BP faces huge bill in worst US oil disaster

It is on course to eclipse the notorious Exxon Valdez disaster as 200,000 gallons of oil a day pours out of the seabed beneath a BP rig Deepwater Horizon that exploded with the loss of 11 lives a week ago.

The oil has spread out of control and started washing ashore along America's Gulf Coast and fingers of oily sheen were reaching the Mississippi River delta, and lapping the Louisiana shoreline in long, thin lines.

The area is one of the world's richest seafood grounds and includes nature reserves where billions of dollars have been spent on conservation.

The spill threatens hundreds of species of fish, birds and other

wildlife along the Gulf Coast.

David Kennedy of the National Oceanic and Atmospheric Administration, said: "I am frightened. This is a very, very big thing.

"And the efforts that are going to be required to do anything about it, especially if it continues on, are just mind-boggling."

The leak from the ocean floor proved to be five times bigger than first reported, contributing to a growing sense that the government has failed the area as it did with Hurricane Katrina and President Barack Obama has dispatched top cabinet officials.

The US Coast Guard worked with BP to deploy a flotilla of 80 boats and tried to burn the oil off the water's surface. BP may have to deploy more rigs to drill down and divert the oil.

After suggestions the military will be called in, a BP executive said the corporation would "take help from anyone".

Some analysts say compensation bills could hit over $5bn and prevent BP being allowed to drill in the Gulf. Yesterday its shares fell 1 per cent on top of a 6 per cent slide on Thursday.