BP says cost of Gulf spill has reached $8 billion

BP has revealed that the Deepwater Horizon rig disaster has so far cost it $8 billion (£5.19 billion).

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by Matthew Goodburn on Sep 03, 2010 at 07:45

BP says cost of Gulf spill has reached $8 billion

BP has revealed that the Deepwater Horizon rig disaster has so far cost it $8 billion (£5.19 billion).

The company said that the figure included all pay outs related to the cost of the 'spill response, containment, relief well drilling, static kill and cementing, grants to the Gulf states, claims paid and federal costs.'

BP said that since the processing of all claims from individuals and companies related to the disaster had passed to the Gulf Coast Claims Committee (GCCF) under Ken Feinberg on 23 August, 42,000 claims had been submitted, equating to more than 4,900 claims totalling $38.5 million in pay outs.

Prior to 23 August, BP said it had made 127,000 claims payments, totalling almost $400 million.The company agreed to create a $20 billion escrow account in June in repsonse to demands from US authorities. It also agreed to suspend at least its next three dividend payouts.

The news comes as BP announced its relief well had reached a depth of 17,909 feet and was expected to intersect the blown Macondo (MC252) well by mid September, weather permitting.

It said no new oil had leaked into the Gulf of Mexico from the well since July 15 and also reported that no volumes of oily liquid had needed to be recovered from the surface since July 21, while the last conrolled surface burning of oil had taken place on 20 July.

But BP said it was continuing to conduct overflights and other reconnaissance to search for oil on the surface.

Shares in the group have recovered in recent weeks since the leaking well was capped, after reaching a low of 303p. Last night the company closed at 393p, still well off its year high of 653p just prior to the rig disaster in late April.

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6 comments so far. Why not have your say?

Is there any agreement that BP can get back any of the money that will be paid into escrow if it is not used? It seems a ridiulous amount of money, more than the whole revenue of the whole gulf of mexico coast for many years. And it's not like the whole place has shut down.

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anyone know when they'll start paying divi's again. and i thought the relief well was on course for mid august???

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Does anyone know if BP are claiming anything from its partners and Transocean & Haliburton? Or if any results are yet known from the enquiry (not the kangaroo court Senate hearings !!)

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I realise that many of you may have invested your money in BP but how can we estimate the damage to the environment in strictly cash terms?

The damage caused to wild life, to people's businesses etc is huge - for those whose businesses have had to close because tourists were avoiding the affected areas, they will probably not be able to open their businesses again.

8 billion for BP is petty cash - they probably spend that amount on just one drilling operation, or their company expenses for their executives - so, I will not be losing sleep over their costs, nor will I be shedding any tears!

Shame on those of you who can only think of the amount of money you may have lost or will lose!!!

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>>>Rose G - 8 billion for BP is petty cash

Would you call a year of your salary petty cash?

And what about the USA? Look at what happened with Union Carbide at Bopal the Exxon Valdez in Alaska and even more seriously look at all the spils currently happening in the Niger Delta by Exxon Mobil. Where is the compensation for all these? It seems to be one rule for the USA and a completely different one for the rest of the world.

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Jon

Sep 03, 2010 at 21:05

Rose G - you fail to point out that other US businesses will benefit - from those paid handsomely to help in the cleanup to those who see more business as Americans spend their money with them rather than near the Gulf. The only damage to the US economy is the NET loss if foreigners decide not to visit the US, or if US citizens who would have spent their money in the gulf go abroad.

So quite apart from some blame on parties other than BP, the company should not be paying the GROSS loss.

I wonder if your pension fund is invested in BP ?

The damage to the environment is lamentable, but the damage will be far less than that caused by over-fishing in most of the World, where sea bottoms have been scraped bare and there is little life left. Do you ever eat fish??

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