BP announced that the company is setting aside $20 billion to honor claims of damages and losses caused by the BP oil rig disaster in the Gulf of Mexico after intense pressure from President Obama in a four hour meeting today.
The $20 billion is not a cap on payments, which could greatly exceed that amount as claims are processed, cleanup progresses, and lawsuits are filed.
AP reports that the company’s “potential liabilities, including cleanup costs, victims’ compensation and civil fines, are breathtaking to consider — stretching far beyond the $20 billion fund.” Liability and payments beyond the voluntary payments may need to be determined by civil litigation in Florida, Alabama, Mississippi, Louisiana, and elsewhere. Lawsuits in each state allege negligence and other claims against BP and the other corporations involved in the disaster, including Transocean, Halliburton, and Cameron International.
BP also may be liable for civil penalties under a variety of environmental protection laws, according to Coast Guard Adm. Thad Allen. As many as 66,000 claims have been filed already, said Adm. Allen. Approximately $81 million has been awarded and 26,000 payments made, he said.