BP Says Barring it From Drilling in the Gulf Endangers Payouts

BPBP (BP) warned that any legislation that stops it from drilling for oil in the Gulf of Mexico could prevent the oil giant from paying out compensation related to this year's oil spill.

Congress is currently considering legislation that would bar any company from receiving offshore drilling permits if more than 10 fatalities had occurred at its offshore or onshore facilities, The New York Times reported. The bill also forbids permits to companies that have paid fines of $10 million or more under the Clean Air or Clean Water acts over a seven-year period.

If BP is prevented from drilling in the Gulf, which accounts for about 11% of its production, then it may struggle to make voluntary payments on top of the $20 billion escrow fund it has set aside to pay victims of the oil spill, the company said.

BP has agreed to contribute hundreds of millions of dollars to projects including a foundation to support rig workers who have lost their job, a research program to study the impact of the spill and marketing campaigns to promote Gulf tourism.

"If we are unable to keep those fields going, that is going to have a substantial impact on our cash flow," said David Nagle, BP's executive vice president for BP America, told The New York Times. That "makes it harder for us to fund things, fund these programs."

The total cost of the oil spill so far is now $8 billion, BP said Friday. The British company also indicated that the well could be permanently sealed within about two weeks, MarketWatch reported.




Increase your money and finance knowledge from home

Investment Strategies

What's your investing game plan?

View Course »

Basics Of The Stock Market

Stock Market 101 - everything you need to know but were afraid to ask!

View Course »

Add a Comment

*0 / 3000 Character Maximum

91 Comments

Filter by:
jklapper93

BP seems to think we are still a colonial territory that they can just dump on...NATIONALIZE ALL AMERICAN BP ASSITS

September 04 2010 at 5:43 PM Report abuse +1 rate up rate down Reply
1 reply to jklapper93's comment
themanindbox

Anyone else wonder if the head of BP claimed this from his billion dollar ship?

September 09 2010 at 4:40 PM Report abuse rate up rate down Reply
Mingo

I'd have to say I do not blame BP If Obama is going to keep the 80,000 workers out of work ,which is his call why should BP pay the tab. they were to pay till they were back to work. Obama is going to follow what Al Gore preached even though he was proven wrong and held back truths and basicly lied Obama is making enimies every day and not for the right reasons

September 03 2010 at 7:24 PM Report abuse +1 rate up rate down Reply
pmoore4425

Another example of politicans screwing things up.

September 03 2010 at 4:09 PM Report abuse +1 rate up rate down Reply
rpaul20988

to tell someone to pay without giving them the means sounds like the IRS...

September 03 2010 at 2:47 PM Report abuse +2 rate up rate down Reply
rpaul20988

Sounds like they want a BILL that will disqualify all companies from drilling especially in the only place our GOVERNMENT will let them drill in the high risk areas. Thw faced idea to say its ok to pay through the nose to buy oil but not ok to drill our oil. DRILL DRILL DRILL

September 03 2010 at 2:46 PM Report abuse +3 rate up rate down Reply
fresherdata

Too bad if the government which includes republicans, blue dog democrats and lieberman, had any balls they'd counter "If you don't pay for what you've done then you can't drill anywhere in America for the rest of your soon to be bankrupt life"

September 03 2010 at 1:27 PM Report abuse rate up rate down Reply
jthinfl

This is way too much government interference.It could spread to other industries also.

September 03 2010 at 1:09 PM Report abuse +1 rate up rate down Reply
1 reply to jthinfl's comment
fresherdata

You mean like bailing out the banks and car companies? Or forcing health insurance companies to provide affordable health care? Or maybe you don't want the police or fire fighters to save your life or your house. Maybe you don't want the government taking care of the roads and bridges you use. Or maybe you don't want public schools. Or maybe you don't want anything done with immigration? Maybe you think businesses and schools should be allowed to practice bigotry. Maybe you think community colleges are beneficial. Maybe you think drug companies should be able to create exotic concotions and start selling them to human beings without testing or responsibility. Have you seen "Gasland" on HBO? Have you talked to anyone from England, France or Canada about their health coverage? Have you read anything at all or do you just watch fox noise.

September 03 2010 at 1:34 PM Report abuse +1 rate up rate down Reply
Ghostman

BP is doing everything that all the others our doing this is not frist oil spill just glamourize by news media so you do not go to beach and get a oil burn

September 03 2010 at 1:07 PM Report abuse -1 rate up rate down Reply
scott7841

Do some research gang........Obama and the democrats are trying to completely stiffle drilling in this country. We will see the price of oil produts go through the roof as we start buying more and more foreign oil. This will push people to Obamas green energy plan and cap and tax policy. Please realize that the carbon credit purchases / taxes Obama supports is to be paid to the worl bank and controlled by the New World Order. I support green energy but has anyone priced wind generators or solar panels, researched the actual savings and how long it will take to get your investment back? Green energy programs right now have less to do with actually producing energy that is cleaner than it does as a multi-billion dollar business funded by the democrats. Some stimulus money was given to green energy research companies (several were operating in other countries) and one that was here recieved something like 30 million dollars and has already gone bankrupt. Does BP need to pay?..absolutely, but they don't need to handle it like Fema did after Katrina and just start writing checks to find out 2 - 3 years later that 2 million dollars plus was paid out to scammers that were no where near Katrina. What about Fienberg? Obamas pay czar.....why is BP still being hammered over slow / no payments when Fienberg took over 3 weeks ago, Cant have it both ways democrats....can't take over the payment of claims and still blame BP for not getting them paid (not until you have stolen and pissed away the first 20 billion anyway). BP was estatic that Obama wanted to take over payments and I can just about guarantee that if they go through the 20 billion and ask for more BP will ask for an accurate accounting of the money spent before writing another check.......the democrats will say BP has paid enough to keep the accounting from being made public. The payouts will be handled just like Fema disaster money with insiders getting high paying jobs created for them to do this. The one number you will never hear is how much of the 20 billion Obama and company ate up in administrative cost.

September 03 2010 at 12:57 PM Report abuse rate up rate down Reply
1 reply to scott7841's comment
lgnu

When you look up paranoid in the dictionary, does your picture appear? Obama was not the verge of expanding drilling in the gulf when the BP disaster hit. But you shouldn't be bothered by the facts.

September 03 2010 at 1:54 PM Report abuse rate up rate down Reply
B & D Auto

Good BP should stand up for themselves. It is criminal the way they have been lambasted in the press. The Gulf spill was an accident and the whole thing would have been dealt with alot sooner if Osama had not stuck his big head into it. The knee jerk Dems are always trying to impose their will on things and people when they have no idea what they are talking about.

September 03 2010 at 12:51 PM Report abuse +5 rate up rate down Reply
1 reply to B & D Auto's comment
lgnu

That's funny most repubs complain Obama didn't react quickly enough or do enough. Both of you are wrong. It was a situation where the government had no expertise or resources and they had no choice but to let BP handle it. An argument might be made that they should aquire the resources before they permit further deep water drilling.

September 03 2010 at 1:58 PM Report abuse -1 rate up rate down Reply