BP says $2 billion spent on US oil spill

Jun 21, 2010 by Allen Johnson
Oil pools in Barataria Bay near Grand Isle, Louisiana. BP has revealed it has so far spent $2 billion on the Gulf of Mexico oil spill crisis, after an internal BP document suggested the undersea gusher might be spewing far faster than initially feared.

BP revealed Monday it has so far spent two billion dollars on the Gulf of Mexico oil spill, after an internal BP document suggested the gusher might be spewing far faster than initially feared.

In a statement to the London Stock Exchange, the embattled British energy giant said its costs to date included ongoing efforts at containment, relief well drilling, grants to Gulf states, claims paid to affected individuals and businesses, and costs incurred by the US government.

The announcement comes after a week of White House arm-twisting that prodded BP to agree to a 20-billion-dollar fund to pay claims and a stepped up oil recovery effort in the Gulf.

Meanwhile on Sunday, US outrage was further heightened by the discovery that BP's own worst-case scenario estimate of the amount of oil leaking into the was some 20 times higher than its early public estimates.

Media reports that chief executive Tony Hayward had attended a yacht race off the Isle of Wight the day after he handed over day-to-day management of the oil leak response, also prompted one of the sharpest expressions yet of administration anger with BP.

"Well, to quote Tony Hayward, he's got his life back, as he would say," White House chief of staff Rahm Emanuel said, referencing the BP boss's now-notorious slip.

"And I think we can all conclude that Tony Hayward is not going to have a second career in PR (public relations) consulting," Emanuel told ABC's "This Week".

"This has just been part of a long line of PR gaffes and mistakes."

Emanuel then assailed BP for its response to the worst oil spill in US history, saying it must be forced to do more.

The company has been regularly faulted for the pace of its response to the disaster, triggered by the April 20 explosion that ripped through the Deepwater Horizon rig it leased, killing 11 workers.

Over the past week, the British energy giant has called in more ships and equipment to the area and said it would significantly boost the amount of oil captured from its busted well.

But a key US congressman Ed Markey, a vocal critic of BP and its handling of the disaster, tore into the firm after releasing an internal BP document that showed the energy giant's own worst-case estimate of the leak was much higher than it publicly stated.

"First they said it was only 1,000 barrels, then they said it was 5,000 barrels, now we're up to 100,000 barrels," he told NBC's "Meet the Press," saying BP was "either lying or grossly incompetent."

US government estimates now put the leak at 30,000 to 65,000 barrels a day -- or, at the upper end of the scale, more than 2.5 million gallons of oil each day.

BP rejected Markey's charge, noting that the conditions it had stated for the worst-case scenario to develop were not in place then, and are not in place now.

"It's completely misrepresenting what we're saying," BP spokesman Robert Wine told AFP. "We were saying that if two conditions were met simultaneously -- one that we got the modeling restrictions wrong and if the blowout preventer were removed -- then we could have 100,000 barrels of oil."

He said the estimate "has nothing (to do) with the amount of oil that's actually escaping at the moment."

BP also raced to defend Hayward's yacht outing on vacation with his son in Britain, which a spokesman called his "first non-working day since this started."

"Still, no matter where he is, he is always in touch with what is happening within BP," another company spokesman John Curry said.

Asked about Hayward's yacht outing, Senate Republican Minority Leader Mitch McConnell said "all of these guys could use a better PR advisor, but the point is we need to get the stopped and keep as much of the oil off the shore as we can."

"Clearly, not enough is being done. All the local officials on the Gulf are frustrated as they can be," he told "Fox News Sunday."

The spill has impacted 59 miles (95 kilometers) of Gulf Coast shoreline, mainly in Louisiana but also in the states of Mississippi, Alabama and Florida. More than one-third of federal waters in the Gulf are now closed to fishing.

In its statement on Monday, BP updated some of its response operations including operations to skim oil from the surface of the Gulf that have recovered in total about 558,000 barrels (23.4 million gallons) of oily liquid.

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User comments : 8

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berwiki
not rated yet Jun 21, 2010
Whatever, 2 billion, who cares?

Weren't we spending more than this, every single day, to fight the Iraq Invasion??

Haven't we given out MAGNITUDES more for the financial bullsh*t thanks to Wall Street in 2008-09.

2.0 Billion??! That's not even a headline anymore!!!

Egnite
not rated yet Jun 21, 2010
Yeah 2Billion is minascule in comparison to the priceless environmental damage we will witness because of this farce.

Heck I'm sure Mickey mouse will sue BP for more than 2bil for the effects this will have on tourism in the gulf region, along with every other business who will suffer.

They are downplaying this so much I wonder if BP/EH/US Gvnmt even comprehend the vast devastation this is going to cause and the major repercussions which will follow? 2bil will feel like cents in a couple years when this charade is still ongoing...
gunslingor1
5 / 5 (1) Jun 21, 2010
"The spill has impacted 59 miles (95 kilometers) of Gulf Coast shoreline, mainly in Louisiana but also in the states of Mississippi, Alabama and Florida. More than one-third of federal waters in the Gulf are now closed to fishing."

-This is a gross under estimate. 170 miles + of shoreline has been SEVERELY affected in Louisiana, 1000s of miles have had minor effects such as dead animals or tarballs.
gunslingor1
5 / 5 (1) Jun 21, 2010

They are downplaying this so much I wonder if BP/EH/US Gvnmt even comprehend the vast devastation this is going to cause and the major repercussions which will follow? 2bil will feel like cents in a couple years when this charade is still ongoing...


Agreed,

They are only concerned with hiding the clearly visible effects (our shore lines) and immediate acute affects to health (which is why fishing is still allowed in parts of the gulf). No long term or cummulative health effects are being considered and little to nothing has been discussed concerning impacts to the actual Gulf water mass, only the shores (where we can see it, out of site out of mind). When considering parts per billion, oil has coated the entire gulf and is beginning to coat the Atlantic. Don't eat fish, trust me, you'll thank me in 10 years.
DrakeP
not rated yet Jun 21, 2010
Every other comment on this article will be some angry American blinded by the media. Seriously, shut up guys.
gunslingor1
5 / 5 (1) Jun 21, 2010
Every other comment on this article will be some angry American blinded by the media.


Lol, that's funny. Most Americans are angry, and most are blinded by media; what's your point?

Would you prefer we sit back and do nothing? Or would you prefer we do the only thing we can do, discuss, resolve and disseminate knowledge?

Or perhaps, maybe, your one of the many BP employees who's current responsibility is internet publicity mitigation? There are rumors of hundreds of BP employees modify web content to decrease the perceive severity of the spill; BP has already bought all listing with "BP" from google.

Go ahead drakeP, do nothing while complaining that everyone else is doing it wrong, that's productive!
frankdphillips
not rated yet Jun 22, 2010
We business owners are only concerned with hiding the visible effects. In an effort to prevent a micro depression in the gulf coastal area. Sorry that we dont want the media saying how terrible everything is all the time, but millions of livelyhoods depend on this sugar coating. Feel free to mount your high horse but the price will not be payed but the pissed off "politicians" it will be payed by the inhabitants that will be without out work if the "sky is falling" machine keeps turning.

Also this is a regional disaster not a BP disaster. Congress authorized the drilling not BP.

And no I dont work for BP I just cringe and loose money and friends everytime the sky falls.
gunslingor1
5 / 5 (1) Jun 22, 2010
I lived along the Gulf coast for 26 years until recently. I'm sorry for your finacial losses, but I personnally put more weight on peoples health than peoples money. Money is only paper, life is more important. Sugar coating is impossible in this senario, nothing good can come out of this, only slightly less bad. All the "sky is falling" talk from the media currently is a best case senario anyway, the ramifications could be far worse; we've just taken a giant bite out of the food chain and contaminated all life in the gulf to at least some extent if not sever massive extents.

As for your comment about the government authorizing the well, I find this to be a non-issue. both the government and the oil companies are to blaim, they've been married in bed together for decades.

I blaim Exxon just as much as BP. BP wasn't doing anything out of the ordinary, the gambles they took have been occuring across the industry. BP was just unlucky.