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BP Gulf spill costs hit $2B, no end yet

BP CEO Tony Hayward prepares to testify on Capitol Hill in Washington, Thursday, June 17, 2010, before the House Oversight and Investigations subcommittee hearing on "the role of BP in the Deepwater Horizon Explosion and oil spill. (Alex Brandon)
June 21, 2010 12:00:00 AM PDT
BP says it has spent $2 billion in two months fighting its Gulf of Mexico oil spill and compensating victims, with no end in sight.BP released Monday its latest tally of response costs, including $105 million paid out so far to 32,000 claimants. The figure does not include a $20 billion fund that the oil giant last week agreed to set up for Gulf residents and businesses hurt by the spill.

The man President Barack Obama picked to run the $20 billion damage fund said many people are in "desperate financial straits" and need immediate relief.

"Do not underestimate the emotionalism and the frustration and the anger of people in the Gulf uncertain of their financial future," Kenneth Feinberg said. "It's very pronounced. I witnessed it firsthand last week."

Meanwhile, scores of lawsuits are piling up against BP for the April 20 rig explosion that killed 11 workers and ensuing oil spill that has yet to be capped.

Scientists estimate anywhere from 68 million to 126 million gallons has spilled from the blown-out well on the seafloor. It's likely to be at least August before crews finish two relief wells that are the best chance of stopping the spill.

The best hope of ending the disaster rests on teams drilling two relief wells meant to stop the seafloor oil gusher, a daunting task: Their drills have to hit a target roughly the size of a salad plate about three miles below the water's surface. If the workers aboard Transocean's Development Driller II or its sister rig DDIII miss or move too slowly, oil will keep pouring into the sea. No one on the rig has done this before because these deep sea interventions are so rare.

Latest Developments:

  • BP chief executive Tony Hayward canceled a scheduled Tuesday appearance at a London oil conference, citing his commitment to the Gulf relief effort. The last-minute pullout followed stinging criticism of Hayward's attendance at a yacht race on the Isle of Wight off the coast of southern England on Saturday.
  • BP is arguing that its partners in the oil well project must share responsibility for the disaster costs. BP owned 65 percent of the well, while Anadarko Petroleum Corp. had a 25 percent stake and a subsidiary of Mitsui & Co. Ltd. of Japan had a 10 percent stake.
  • Several oil service companies are asking a federal judge to block the Interior Department from enforcing a six-month moratorium on new deepwater drilling projects in the Gulf of Mexico. U.S. District Judge Martin Feldman heard arguments Monday in New Orleans on Hornbeck Offshore Services' bid for lifting the moratorium. A lawsuit filed by the company claims the government arbitrarily imposed the moratorium and suspended drilling at 33 existing exploratory wells without any proof that the operations posed a threat.
  • Shares of BP, which have lost about half their value since the rig Deepwater Horizon burned and sank off the Louisiana coast, were down nearly 5 percent Monday in London trading at $5.06.

The Associated Press contributed to this report.


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