How the oil spill escrow fund would work


According to BP, the $20 billion account for paying Gulf claims will be fully funded by the end of 2013.

The company will put in $5 billion by the end of this year -- an initial payment of $3 billion by the end of September and another $2 billion by the end of the year. For the next three years, it will pay in $5 billion a year, in quarterly amounts of $1.25 billion.

And here's an interesting point: BP says the fund will be used to pay claims submitted directly as well as damages awarded by courts as the result of lawsuits against BP.

"The fund will be available to satisfy legitimate claims, including natural resource damages and state and local response costs," the company says in a release. A White House statement says, "The facility is designed for claims of individuals and businesses who have been harmed by the oil spill."

The White House also says anyone who files a claim and is not satisfied with the response can still sue BP in court.

Discuss this post

This has to be another attempt by the Administration to make it seem as if something is actually being done. Good thing we all know that the Repugnant ones know better and that Obama is purposely waiting for the right moment to pull the rug out from all those demanding action...

    Reply#1 - Wed Jun 16, 2010 3:47 PM EDT

    Disgusted:

    I like your way of thinking ;0) In the book 'The Promise' there's a reference in there that President Obama plays 3-D chess...

    Which leaves the party of male - stale & pale... playing with themselves...

      #1.1 - Wed Jun 16, 2010 3:53 PM EDT

      How so Disgusted?

        #1.2 - Wed Jun 16, 2010 3:54 PM EDT

        Well, actually, this seems to have been a start toward that. But, as you suggest, I'm very much afraid of the secret handshake sort of deal that seems to have been struck here. Whether that's the WHOLE deal, or just part of it, remains to be seen. And then, whether it will be enough, or whether there will also be contributions from Halliburton, Transocean, and any one else who may share the liability.

          #1.3 - Wed Jun 16, 2010 3:56 PM EDT

          BP is responsible for the majority of the costs of the spill.

          BP owns 65% of the well. Anadarko Petroleum owns 25%. A Japanese company owns 10%. These three companies will share the costs.

          Transocean owned the rig. They were drilling BP's well, and so by contract, assigned any liabilities to BP. They assign liabilities because they don't know the archeological make up of the hole they drill, so they avoid responsibility. Halliburton was contracted for the cementing. The blow off preventer was made by a company in Korea. Likely, BP will go after their vendors once their investigations are complete.

            #1.4 - Wed Jun 16, 2010 5:37 PM EDT

            I agree with all the above comments; however, BP have insurance and will not foot the entire bill. They knew this was coming so I am almost sure there were some deals with the other responsible parties in contributing to the payout.

              #1.5 - Wed Jun 16, 2010 6:53 PM EDT

              Penny,

              Actually, BP is apparently Self-Insured, meaning they did not feel that they needed to pay out all that extra money (common thread) to the insurance Co.'s. They WILL have to cover ALL of the costs themselves, at least initially. They may win some back in lengthy court proceedings against the Blowout Preventer's manufacturer, but I have a suspicion that that case will go nowhere since BP modified the BOP and apparently failed to do regular, realistic maintainance. One of the hydraulic rams was even disabled as a dummy test circuit. Just another in the long line of willful neglect of proper proceedures in the run for the money.

                #1.6 - Thu Jun 17, 2010 4:18 AM EDT
                Reply

                Hey MSNBC, WTF is up with that plume shot, enough already, 99% of the people looking at it have no clue as to what they are looking at, especially TweetyBird. Shut it off, it serves no practicle purpose and is not reporting...duh. Also WTF is up with the day 56 thing, trying to spin this to Jimmy Carter..duh, you pundits are so trickey..thanks for looking out for the "American People".

                • 1 vote
                Reply#2 - Wed Jun 16, 2010 3:56 PM EDT

                What?! Seems self-explanatory to me. Or isn't that actually the plume? Or are you just tired of looking at the reminder of what the anti-regulation folks have wrought without having any good explanation for why it happened or how it can be stopped?

                  #2.1 - Wed Jun 16, 2010 3:59 PM EDT

                  You will see those images, just like the images of Katrina, until and perhaps after the crisis is over. When Keith Olbermann closed his program with the number of days since W announced "mission accomplished" (or a banner did) it was entirely appropriate, and factual. When we commemorate the amount of time since an important event has occurred, it is to highlight that importance. It has been 57 days since the greatest ecological disaster in our lifetime has happened, with the end nowhere in sight. It would be highly inappropriate and be a disservice to those affected and those currently risking life and limb to suppress either the images or duration of the crisis.

                  • 1 vote
                  #2.2 - Wed Jun 16, 2010 4:36 PM EDT

                  Agreed, Diogenes...

                  Once K.O. began to meter the days since the Deepwater Horizon/BP well blew out, he bought into sticking with it until the "hole is plugged".

                  Of course, that might prove inconvenient to the Obama Administration.

                  But, I don't see how Olbermann stops marking the days as long as the leak continues to gush oil.

                    #2.3 - Wed Jun 16, 2010 4:56 PM EDT
                    Reply

                    In other news, according to a BP exec, they are down with the 'small people.'

                    Reports indicate that citizens all over the gulf coast are vastly relieved.

                      Reply#3 - Wed Jun 16, 2010 3:56 PM EDT

                      Feisty,

                      Here we go. Too little, too late, not enough, too much. No matter what President Obama does these brain dead freaks will dribble from their mouths. Where is my duct tape. That screw ball from MN claims this is a redistribtion of wealth. I wonder how those in need feel about that.

                        Reply#4 - Wed Jun 16, 2010 4:14 PM EDT

                        I wish I could put my finger on why the 'right wing nuts' have nothing but raw unadulterated hatred for the President?

                        Any ideas? ;0)

                        And the screwball from MN is only b!tching because she's not getting a piece of the pie! She's fine with subsidies as long as they go back to her whacked out district! I read somewhere that's the reason she's so 'anti-census' is because she's in danger of the district being eliminated!

                          #4.1 - Wed Jun 16, 2010 4:22 PM EDT

                          speaking of screw balls did any body see Sarah palin on bill O'Reily last night. she was stomping mad at the president and talking S**t at the president ,it was funny that Bill was kind of looking at her like WTF. i have gotten to the point that i can't watch cable news. this is the same MSM that to me has forgotten what inaction really is, does any body remember Katrina, Now that was inaction. Former president Bush at the white House eating cake with John McCain while thousand were dying of thirst. they on Fox keep trying to compare this spill to Katrina, Please.

                          oil spill Man made disaster

                          Katrina natural disaster

                          who can anybody compare.

                            #4.2 - Wed Jun 16, 2010 4:29 PM EDT

                            Well, actually both would have been lessened at the very least, if the federal government had been doing it's job and following the guidelines and regulations that already existed. Levies are man made, and their failure, just like the failure of the so-called "fail-safes" on the deepwater horizon, and the failure to ensure that a relief well was drilled have exacerbated our current crisis, just as those previous failures exacerbated the devastation of hurricane Katrina . There are many comparisons that can and will be made. Those on the right were I am sure just as offended then as those on the left are now. The dead, the injured, and the citizens who have lost their livelihoods and homes probably don't care about such distinctions.

                            • 1 vote
                            #4.3 - Wed Jun 16, 2010 4:52 PM EDT

                            Feisty, my love-

                            You're simply not paying attention.

                            Dissent is NOT hatred...despite what Chris Matthews has been trying to tell you. And...I notice you take Matthews' utterances with a grain of salt these days, don't you? And the words of Chuck Todd, Keith Olbermann, Andrea Mitchell, Howard Fineman, etc, as well...I could go on forever, Feisty.

                            Dissent didn't magically become race-based hatred on Inauguration Day, January 20th, 2009.

                            Do you really believe that the mainstream media has suddenly decided that they hate President Obama?

                            That's silly, Feisty...they've simply begun, belatedly, to do their job.

                            And...not a moment too soon.

                            • 3 votes
                            #4.4 - Wed Jun 16, 2010 5:08 PM EDT

                            There's that, and the fact that the residents of New Orleans were told to evacuate before the storm and chose to ignore, the mandatory evacuation order....

                            But who really cares who fault it is! Just fix it, clean it up and work to prevent it happening again. That's all we can do. Looking back, saying what could have been done differently doesn't change anything. If it isn't apparent by now that BP is going to do everything in it's power to fix this then nothing is going to take your blinders off. Some of you seem to have the impression that BP is somehow benefiting from this, please explain to me how? Because if I owned a company that had an accident this big, I would be doing everything I could to make sure the rest of the world saw that I was going to fix it, so they would continue to let me work in the areas. BP has nothing to gain from the ongoing media coverage of the spill and everything to gain by making it stop.

                              #4.5 - Wed Jun 16, 2010 5:15 PM EDT

                              Hey Mixed,

                              No, dissent is not hatred and dissent did not magically become race-based hatred on inauguration day. If you recall, on inauguration day 2000, dissent became "anti-Americanism" and was used to paint people as un-American and un-patriotic. We can now openly question and challenge authority while you and yours are busy painting the "brown tide" as the reason you have all lost your grip on the wheels of power AND reality...

                                #4.6 - Wed Jun 16, 2010 5:15 PM EDT

                                Disgusted-in-PA-

                                I can't tell you how relieved I am to hear you say that dissent is not race-based hatred.

                                Could you spread the word?

                                Particularly here at First Read?

                                There's a lot of folks here that don't know that.

                                Thanks again,

                                MB

                                  #4.7 - Wed Jun 16, 2010 5:32 PM EDT

                                  Aww Mixed Nuts!

                                  NOW I'm feelin that love again! Nice to see that spanking I gave you improved your mood!

                                  Thank you Feisty... may I have another? ;0)

                                    #4.8 - Wed Jun 16, 2010 5:59 PM EDT

                                    Diogenes-1891091

                                    Besides the 11 Rig workers where are the thousands of dead people? Tragic yes but we have lost fish shrimp and birds No where near the tragedy that was Katrina! No comparison it seems as though you are equating people to animals? Are you? Oh that's right if there's no money then that's equivalent to to a precious life. 9/11 and Katrina both took financial and large human tolls. I am not saying that the loss of life during this spill is insignificant but it isn't on the scale of 9/11 or Katrina, its mainly financial. I see where most Americans hearts lay. So when you speak about exacerbating a crisis please keep a perspective of the type of loss being suffered. And how long were regulations being overlooked and who knew what when.

                                      #4.9 - Wed Jun 16, 2010 6:13 PM EDT
                                      Reply

                                      "Likeability wins presdiencies and re-elections...."

                                      And I am sure there is a ton of empirical evidence to support that contention.

                                      I didn't support Reagan, hated Bush, and was far from alone on that one, but both were re-elected. Many factors play into electoral politics, and likeability is certainly one of them, but likeability can be trumped by many others, particularly events like the one we are living through right now.

                                      This president is only beginning to be criticized for his part in the handling of the oil spill. The polls are trailing indicators. We have months of this disaster to go before it is no longer the lead story on the nightly news and with the punditocracy. It is still entirely possible that we don't know the complete extent of the damage to the sea floor where the busted well is located. Every day brings new and more damaging news as to the amount of oil that was, and is gushing into the gulf. There is no way to determine the political fallout while we are in the middle of the crisis, except that to say that there is and will be political fallout.

                                      Every day that the oil continues to gush into the ocean, every day that we see the sad devastation of our coastline and tortured wildlife, every day that we see our politicians jockeying to assign blame to the other side, is going to erode more than just likeability, for all those involved.

                                      • 1 vote
                                      Reply#5 - Wed Jun 16, 2010 4:24 PM EDT

                                      How true. I am afraid it is also going to erode the very fabric of this great country as well. With so much garbage, misinformation, hate and fear out there people are huddling into smaller and smaller groups.

                                      We have to all start pulling together.

                                      Our country is a car driving down the highway at 70MPH and the temperature gauge is in the red and the oil light just came on. The nearest service station is miles and miles away.

                                        #5.1 - Wed Jun 16, 2010 4:52 PM EDT

                                        Diogenes:

                                        You are back. Goodness!! I suppose what you state above holds a bit of truth to it. But recognize that although Obama's approval numbers for how he has handled the gulf oil spill are not very good, his over-all approval rating remains at 50%. So the question remains, will the gulf oil spill ratings at some point spill over into Obama's over-all approval ratings. Only time will tell.

                                        Hey, you need not remind me of the damage and loss of precious marine life and wildlife that will be lost as a result of this spill. Many of these kinds of living beings were my best friends, and those of my son, while living a stone's throw from the gulf water for over ten years. There are even a few adult alligators, adults now, who when but youngsters were docile enough to allow my son to paint his name on their bellies. We think of them often and how they are faring.

                                        If you knew how important these friends were to myself and my son and how much we love the same, you would also then know that thoughts of these friends are only tainted by all the BS politics and blame game going on, and that includes towards Obama. The man does not like what happened anymore than you or I. He is trying to resolve some of the issues the spill has caused and will cause. He is not perfect and will make errors along the way, but he is trying. This criticism achieves nothing and means nothing. It only exhibits how human beings can misplace or ignore what is important in this life for the purpose of winning the human one-up-man-ship games they play. And i nthe end if people reject Obama because of this spill so be it. They will lose because they will have proven that while finding a scape-goat they themselves lost forcus as to what's important, and he will gain by being given the opportunity to leave that human tragedy called American politics and voter ignorance.

                                          #5.2 - Wed Jun 16, 2010 4:52 PM EDT

                                          Having just returned last week from the Naval War College's "Current Strategic Forum", I am much more optimistic than I was before about the fate of our union in the long run, though I agree that the current snapshot is scary as hell...Thank you for your service

                                            #5.3 - Wed Jun 16, 2010 4:56 PM EDT

                                            I thank you for your service as well. Were you at the war college in San Diego? My daughter (Lt.JG) is stationed at the Naval Medical Center in Balboa and when we visit we stay at the Naval Lodge in Coranado.

                                            We are in scary times and I hope you are correct. Again thank you for your service. Stay safe.

                                              #5.4 - Wed Jun 16, 2010 5:23 PM EDT

                                              "You are back. Goodness!!" and for goodness sake...

                                              As my reply was directed at your contention and not you personally, the "some of my best friends..." defense is puzzling, but then it is my opinion that the necessity to view every event through a politically biased filter/prism cripples any cogent analysis.

                                              Again, there is ample blame to go around and some will be directed at the president, deserved or not. A year ago today, the president's popularity stood at 60.5% (rcp avg) slowly eroding to 50%ish and it has hovered in the 50% range for at least the past 6 months. It stands to reason that the current crisis will move the needle as the crisis continues. Actions taken today will influence which way the needle goes this time next year, but how much a president is liked has to do with much more than mere likability, and a single event can change the general public perception of a president and their likeability, as the poll numbers for W post 9/11 and post Katrina clearly attest. "W" was just as likeable or detestable all the time, depending on your political leanings, but events came along and overtook his "q" rating...that's just the way it is...

                                                #5.5 - Wed Jun 16, 2010 5:24 PM EDT

                                                I was at the War College in Newport RI, With Adm Nolan, adm Wisecup, and Secy Mabus. I have never been to the War College in San Diego, but it must be beautiful, as the Navy knows how to choose real estate!...:)

                                                My very best to your daughter and to you. I am of the hopeful belief that she would agree with my assessment that things will get better...AYE!

                                                  #5.6 - Wed Jun 16, 2010 5:30 PM EDT

                                                  There was no attempt to defend anything in my response. I need not defend myself to you or anyone else. I was simply expressing a similar love for the marine life and wildlife that you had mentioned in your post, and that will suffer terrible tragedy as a result of this spill. You stated that Obama may suffer politically as a result of this spill and its effects. I did not disagree. I said we shall see. I said that if he does and because I thought he was trying to reslove many of the issues resulting from the spill then it will be the people's loss. That is my opinion. I need not defend opinion.

                                                  We can discuss this topic as well as many others Diogenes, but the attempted use of pseudo-superior intellectual twist and turns in your communications with the bloogers here give me pause to consider your intentions. Are you as stolid in your mind and personal observable expressions as you come across in your written word? Do you smile from time to time? I shall consider, observe and perhaps even add more later.

                                                  Have a good day.

                                                    #5.7 - Wed Jun 16, 2010 5:48 PM EDT

                                                    Retired... great analogy - the only thing I might add is we're going down the highway at 70mph in reverse

                                                    We do all need to start pulling together and unfortunately the small minded still suffer from tunnel vision!

                                                      #5.8 - Wed Jun 16, 2010 6:03 PM EDT

                                                      "We can discuss this topic as well as many others Diogenes, but the attempted use of pseudo-superior intellectual twist and turns in your communications with the bloogers here give me pause to consider your intentions."

                                                      ...well, that made me laugh out loud...again the (s)ad hominem bent of the "bloggers" here gives me the willies...:)

                                                      "I said...good day!"

                                                        #5.9 - Wed Jun 16, 2010 6:04 PM EDT
                                                        Reply

                                                        BP deposits $3 billion in this coming 3rd quarter, $2 billion in the 4th quarter, and funds the rest of escrow account $1.25 billion each quarter through 2013. They cut the dividend today, so they just saved $10 billion in cash, plus $16 billion they had in cash on hand. Still while the fund is "building" BP will set aside US assets with a value of $20 billion. This indicates payouts will be made versus the asset value, even though they have the cash.

                                                        I wonder who's floating the money? Are we?

                                                        I pray compensation is not delayed to the folks who need it by Ken Feinberg's new office. Is he ready to start the job tomorrow?

                                                          Reply#6 - Wed Jun 16, 2010 5:53 PM EDT

                                                          FR--The White House also says anyone who files a claim and is not satisfied with the response can still sue BP in court.

                                                          I would say that the President did an EXCELLENT job negotiating this baby. I wonder if the pundits are feeling just a tad bit @!$%#ty today? They should be because they are always underestimating the abilities of this President.

                                                          Okay...now is the time to take off the doubt and give President the opportunity and respect he deserves as CIC. We have many issues that we are facing our nation and fake anger from supposed party affiliates (Carville) and the likes are only serving to ensure the losses of seats of Democratic Lawmakers that have turned their backs on their party.

                                                          We respect leadership that remains strong during adversity as opposed to theratical performances with booming empty speeches that mean diddly squat to people that know the difference between chit and shinola. We elected the right person for the job and the sooner he's accepted as being our choice...the better and faster this nation will heal and progress.

                                                          BP has actually done no more than what other oil companies could have done-- they just happened to be the ones that received the short straw at this TIME and our Eco-system suffered the devastation from the hand they were dealt.

                                                          There isn't a single oil company that drill off-shore that's capable of containing a spill of that magnitude in those depths; because our federal government didn't require them to have any technology in place to protect our environment and it citizens. Hopefully six months would be enough time for this Administration to check the wells for safety shut-off valves and our technological advancement teams sufficent time to create technology that will be our national defense against common enemies...ourselves and fossil fuels...

                                                            Reply#7 - Wed Jun 16, 2010 6:57 PM EDT

                                                            Anita, I agree with you. The back end of the deal that BP HAD to take is that they can still be sued in court. If I was the CEO, that kind of liability on the back end would worry me. It looks like President Obama had some hole cards because BP agreed to it.

                                                              #7.1 - Wed Jun 16, 2010 10:52 PM EDT
                                                              Reply

                                                              Stop the socialism now...our president just extorted money from a private company to pay off claims no matter how goofy or lame and BP can't challenge them unless its over 500K? I hope none of my conservative friends in the gulf are bellying up to this socialist tripe.

                                                                Reply#8 - Wed Jun 16, 2010 7:41 PM EDT

                                                                Didn't Boehner advocate that the taxpayers pick up the tab for irresponsible ex-CIC's BS lie that off-shore drilling was safe? Didn't his own father call for a ban on off-shore drilling? With that being said-- didn't Bauchman and the shriller's of drill baby drill" express anger at the fact that "big" oil is being hit with the 20 billion dollar OPEN fund? The same as you are now...

                                                                Money wasn't extorted from BP it was due from BP...

                                                                  #8.1 - Wed Jun 16, 2010 9:54 PM EDT

                                                                  Puhleese Anita.. Agent Orange is getting himself a little 'Snookie' ;0)))) Since it's obvious the Geezer isn't UP to the task...

                                                                    #8.2 - Wed Jun 16, 2010 9:59 PM EDT

                                                                    Hey GF!!

                                                                    I've been answering responses and trolling around to see if I can find some nuts to whack! LMAO!! I just watched TRMS and I must say; I'm getting weary of our Progressives going behind the President with their take on the coulda, woulda, shoulda. It's his Presidency and he has his way of doing things that comes together.

                                                                    They simply refused to be patient and the constant titching of what they want! Good Laud! What ever happen to respect for the Office? I guess I'm just old school that get sick and tired of ignorance and squawking. You attack my President with BS and I'll call you out for it-- it's just that simple, we can agree to disagree.

                                                                      #8.3 - Wed Jun 16, 2010 10:17 PM EDT
                                                                      Reply

                                                                      The mere fact that BP can pony up 20 BILLION dollars at a drop of the hat (OK, in 5 BILLION dollar increments) and not even blink sure tells me a LOT.

                                                                        Reply#9 - Wed Jun 16, 2010 10:49 PM EDT

                                                                        Obama is extorting $20B from BP and states that the fund will be managed by a “third party” and I can almost guarantee that this fund will be run by Obama’s crooked-cronies. The union's and far-left liberal groups will receive the bulk of this money.

                                                                          Reply#10 - Thu Jun 17, 2010 8:39 AM EDT

                                                                          So, it would be better to let BP decide how much to pay and to adjudicate all claims themselves? BP did such a great job of providing safety oversight on their rigs, why wouldn't we simply trust them to do the same great job on adjusting the claims?

                                                                          Are you and your ilk really so concerned about the fate of big oil like BP? Why is it so hard to accept that OUR President managed to remove the criminal from administering the payments to those that were damaged? Are the unions and "far-left liberal groups" lining up to make claims against an escrow fund overseen by a trustee that is there to ensure only legitimate claims are paid? What is it with you wing nuts anyway? You are so in favor of letting the market police itself that you will allow these companies to rape the environment, steal from us all, and then balk at them having to pay for what they have done? What the hell is wrong with you morons?

                                                                          • 1 vote
                                                                          #10.1 - Thu Jun 17, 2010 9:00 AM EDT
                                                                          Reply
                                                                          ColliDeleted

                                                                          How it works That depends on how many sharks can get their hands on it! Now they false claims start and nobody knows how truthful those claims are not even the IRS.,

                                                                            Reply#12 - Thu Jun 17, 2010 11:29 AM EDT

                                                                            Theforce5:

                                                                            It should be easy too do. If you own a business that was affected by the spill; you should have IRS documentation for tax filings, if you employ someone that has lost their job, you should have State and Federal tax filings-- all others such as medical claims should have documentation from physicians with diagnoses. I don't see a problem with legitimate claim filings.

                                                                              #12.1 - Thu Jun 17, 2010 12:33 PM EDT
                                                                              Reply
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