BP's incoming CEO Bob Dudley promised to continue long-term financial support for people affected by the catastrophic Deepwater Horizon oil rig spill, speaking at a press conference in Biloxi, Miss., on Friday.
Dudley also said that the company may start scaling back its clean-up efforts in the Gulf of Mexico, mainly because the amount of oil on the surface of the water has dramatically decreased in recent days. However, he says that BP remains committed to cleaning up the damage wrought by the spill.
Dudley's assurances come at a time when environmentalists, residents and people who rely on businesses in the Gulf Coast for work, are concerned that BP and the U.S. Coast Guard will pull up stakes and withdraw their financial support once the catastrophic oil leak is no longer spewing a drop of oil.
"We have written about 80,000 checks, more than a quarter billion dollars, but we realize this is not perfect and there's more to go," Dudley said at the televised press conference.
Currently claims for damages due to the leak are being paid out of BP coffers, but the company announced in mid-June that it was setting up an independent $20 billion Gulf Coast Compensation Fund that will be responsible for handling claims. It expects the fund to be up and running in late August. Gulf Coast residents who've lost their jobs or suffered declines in business due to the oil spill, have complained of slow reimbursements or little response from BP.
"We need to get this moving as fast as we can," said Dudley.
In addition, BP announced Friday a $100 million Rig Worker Assistance Fund to support unemployed rig workers who are experiencing economic hardship as a result of the moratorium on deepwater drilling imposed by the United States federal government. This fund will replace a similar fund announced in mid-June for oil rig workers who lost their jobs because of the temporary moratorium on offshore oil drilling.
The incoming CEO also said former Federal Emergency Management Agency chief James Lee Witt will support BP's (BP) long-term recovery efforts. But it appears that Witt will be overseeing a diminishing clean-up effort. Dudley said that on beaches where there is no oil, there is no need for workers in hazmat suits and that it's not too early to begin scaling back the clean up, according to an Associated Press report. Yet environmentalists are likely to applaud Dudley's assertions that the environmental impact of the catastrophe has not been overblown.
Dudley, who grew up in Hattiesburg, Mississippi, is considered to be more committed to the area and a stronger leader than Tony Hayward, the embattled BP CEO, who is widely viewed as mismanaging the company's response to the disastrous April 20 oil rig explosion and resulting oil spill. Dudley will officially assume the CEO post on Oct. 1.
BP is planning to try a "static kill" Tuesday to seal the Deepwater Horizon oil rig and expects to have a relief well finished by the end of August, according to a Reuters report.
Dudley's press conference, by coincidence or not, comes on the day that the U.S. House of Representatives is scheduled to vote on oil spill legislation that would govern such things as new safety standards for oil drilling.
Investing in Emerging Markets
Learn to invest in a globalized world.View Course »