BP: Will, Say, $20 Billion Cover It?

Photograph of waves off of Alabama from Ecoterrorist's Tumblr

[UPDATE BELOW] BP has tentatively agreed to set aside approximately $20 billion for a fund to pay claims for the Gulf oil spill. The fund will be run by Kenneth Feinberg, who specializes in mediation and dispute resolution. Feinberg served as "special master" for the 9/11 Victim Compensation Fund, as well as cases involving compensation for victims of Agent Orange used in Vietnam, the Times reports.

Feinberg will run the claims process as an independent third party, and according to the preliminary terms of the agreement, BP "will be given several years to deposit the full amount into the fund so it could better manage cash flow, maintain its financial viability and not scare off investors." The company's stock has lost half its value since the oil well exploded on April 20th, and they've already spent $1 billion "dealing" with the catastrophe.

UPDATE: BP announced today that it was canceling dividend payments for the rest of the year, and would decide later whether to restart dividends in 2011. The decision will be an enormous blow to pension funds in the UK, where one of every six dividend dollars paid to pension funds in Britain (10.2 billion a year) comes from BP profits, Commodity Online reports.

After meeting with President Obama and White House officials today, BP Chairman Carl-Henric Svanberg told reporters that those who think BP doesn't care about anything besides profits are just wrong. "We care about the small people," Svanberg said. "[Obama] is frustrated because he cares about the small people, and we care about the small people." Thank you so much for caring, almighty petroleum giant!

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By John Del Signore in News on June 16, 2010 4:02 PM

Comments [rss]

chuzzlewit

that photo is great - see how the globules are coursing up the face to gather in the curl? no mere oil spill will get this effect - you have to get the grade of crude right and then dump just the perfect amount of Corexit® in there to get that effect (it takes more than one would think!). really nice work here.

Jen S

Too bad the fish won't be around to admire it.

ed_Extinct

bp is worth approx $240BB. The costs for the cleanup since it started has exceed $8BB. How can $20BB even be close to a good start?

callo282

Wondering how much BP is worth? What percentage of it's worth is $20 billion?

r1b2

That photo is absolutely horrible.

If they arrived at $20BB that quickly, imagine what it will REALLY cost to clean up? $50BB? $100BB?

longacre

A billion a minute? Not bad, Barack.

Yep, super-hyped meeting between Obama and BP brass lasted an entire 20 minutes.

Politburo

It was later reported that the meeting was 4 hours, btw.

Politburo

Hyped by whom, though..

Neither Obama nor the Chairman nor the CEO has any direct involvement in what's going on. The whole "OMG Obama hasn't even talked to the CEO!!1" was a media-fueled controversy.

Jen S

For real. People are so quick to say he's not doing enough, he's not angry enough. What is the CEO going to say to make it better? What good will getting angry do?

The coasts are getting attention. Business owners will get compensation (hopefully enough, however much that may be). BP will be held responsible. What more do we expect?? It's a tragedy and has been recognized as such. Now it's time to be rational and fix it asap.

yamon

This photo makes me sick to my stomach...that is all.

Mordicai

This is 20 billion that they can't touch even when they go bankrupt & call olly olly oxen free?

jles

Yeah. But, the issue is that $20B isn't enough, and they'll probably go bankrupt long before even half of these damanges are realized. We should be milking as much as we can as quickly as we can.

Mordicai

Yeah, but I mean-- I kind of expected them to get off scott free. I was assuming a 1 trillion dollar price tag, ultimately.

callo282

That photo is heartbreaking.

Kojak

This is why we need to stop drilling in the Gulf of Mexico NOW!!!! STOP ALL DRILLING!!! SAVE THE ANIMALS

...What? You say if we stop drilling, the price of Gasoline & Gasoline will skyrocket?

Ohh these accidents happen all the time! Just a couple of bandaid regulations should do the job. No problem o.

jles

PAH! Stop drilling! Are you serious?!? The MMS has already FULLY APPROVED 27 more drilling sites since this oil spill happened.

GOVERNMENT OVERSIGHT EVERYONE!!!! More like UNDER-sight, AMIRITE!?!

Kojak

Gas & Gasoline. Bahh

Jen S

We'll kill ourselves to save on oil and ignore the future.

Amanda Harletsch

OK, and who is going to clean up the SEA?!

The waters? The WETLANDS!?

NOBODY"S LAND!?

This money is going to "individuals"...

But there is more than human life that was disrupted here.

Once you get payed for you losses -that is PAST- then what about the future?!

Who FORM THE CORPORATIST will be setting up any environmental recovery, THAT IS PUBLIC INTEREST!?

uh!?

No corporation is obligated to consider public interest!

And animals have no rights, and plants, are useless to corporatist unless they can patent their genetic material like Monsanto does...

THIS IS JUST A SMALL BAND AID from the decades of ecological consequences this BP mess is!

SP's Ghost

The oil in the sea itself isn't that big of a deal. The proportion of salt water to oil, and bacterial action, will break it down quickly. The problem is the oil that washes up on the coast and soaks into wetlands where the proportion of oil to water is high.