By Gary Taylor in Houston

July 13 - The US government on July 12 imposed a new deepwater drilling moratorium that bans most deepwater drilling until November 30.

With fair weather to accommodate a weekend of hectic activity, BP appeared on the verge July 12 of stopping the leak at its runaway Macondo exploration well in the Gulf of Mexico through installation of a cap that would either plug the well or allow for total containment.

But the company stressed that any success with its new sealing cap at Macondo would not eliminate the need for completion of a relief well as the ultimate solution expected some time in August.

Analysts at Houston-based Tudor Pickering Holt were quick to describe as a "long shot" the prospect for a total kill with the sealing cap that BP had positioned for placement by the end of the day.

Before deciding its next step, BP will need to monitor well pressures through that cap for six to 48 hours, said BP Chief Operating Officer Doug Suttles during a press briefing to update on the multiple operations accomplished over the weekend.

If the cap displays high enough pressure readings, Suttles said engineers would view that as a sign of strong wellbore integrity with a wellbore capable of holding the oil down below the cap until the relief well can kill the well at its source.

But Suttles said lower pressure readings would indicate problems in the wellbore and prompt installation of a complex containment system with the capacity to collect as much as 80,000 b/d of the leaking oil.

Unless a government panel has severely underestimated the Macondo flow with a range of 35,000 to 60,000 b/d, the expanded BP containment system likely would capture most of the oil leaking from the well.

"Until the job is complete, we have to recognize this is a complex operation," Suttles warned.

But he also described his confidence as "growing" after the successful installation July 11 of a transition spool as the foundation piece for the sealing cap device.

If successfully installed, BP's complete containment system would move oil from connections on the sides of Macondo's malfunctioning blowout preventer and through the top of the BOP to an armada of vessels waiting on the surface to process it and move it to shore on shuttle tankers.

BP and the US Coast Guard launched the sealing-cap installation ahead of schedule July 10 after learning they would have a window of fair weather for the next week that might not recur all summer.

One of BP's primary containment options had already been delayed by Hurricane Alex, and national incident commander Thad Allen, a retired Coast Guard admiral, decided to seize the opportunity of an accommodating weather window to move forward.

But the operation did not come without risks as BP was forced to remove its initial containment cap July 10, allowing an estimated 15,000 b/d of oil, which was formerly being collected, to flow again into the Gulf temporarily while preparing the BOP for installation of the sealing cap that was about to occur July 12.

BP had estimated the entire sealing-cap operation would take from four to seven days, and Suttles said July 12 that still appeared to be an accurate projection.

At the same time over the weekend, BP also was working to connect the Helix Producer I floating production vessel to the BOP's kill line as an enhancement that could add 25,000 b/d of capacity to the two-pronged system that had been diverting 25,000 b/d since its installation in June.

That earlier system included the containment cap removed July 10 and a connection to the BOP's choke line with the Helix Q4000 multipurpose vessel, which has been flaring about 7,000 b/d of oil as part of the containment effort.

Under the new system, none of the oil would be flared as the Q4000 would depart and yield to other production vessels that now have arrived on the scene.

Although BP had expected to have the Helix Producer operating by July 11, Suttles said that installation encountered two problems that delayed it for about a day.

"The Helix Producer encountered two problems that created some delay," Suttles said, citing issues with a hydraulic control line for a valve and a leak.

But BP did have the Helix Producer connection completed by midday July 12 and expected to see it ramp to full capacity in a few days.

Collection through the Helix Producer and the Q4000 was scheduled to halt, however, during the pressure testing of the sealing cap, Suttles said.

With the containment cap removed and the Helix Producer delayed, containment at Macondo fell July 11 from the average of 25,000 b/d to just 8,235 barrels diverted from the BOP choke line to the Q4000, Suttles said.

Since installation of its June containment system, BP has diverted a total of 779,000 barrels of oil from the leak.

BP's primary relief well has reached a depth of 17,840 feet, including 4,993 feet of water, and Suttles said he expects its casing operation to begin this weekend.

Meanwhile, a second backup relief well has reached a total depth of 15,874 feet and will be halted there unless the primary relief well fails to intercept Macondo, Suttles said.

"We remain on track to have the cap in place in the four-to-seven-day time frame," said Suttles, summarizing the multiple operations under way since July 10. "We are on day three, and later today we'll begin on the Helix Producer."

Commenting on BP's ambitious plan for using the sealing cap as a plug, analysts at TPH said in a report: "We think this is a long shot."

Elaborating, they warned: "There is significant risk that the larger casing would rupture near the surface of the well, resulting in an underground blowout. In that bad, bad, bad scenario, oil and gas would crossflow from the Macondo reservoir, up the well and out into the shallow formations."

The TPH analysts have also said they believe the relief well has a 99% chance of success for permanently killing Macondo some time in August.

The Macondo crisis began April 20 with a blowout at the well that destroyed Transocean's Deepwater Horizon drilling rig and created the largest marine spill in US history.