Commentary By Ron Beasley
Now we know why BP has attempted to minimize the amount of oil gushing into the Gulf Of Mexico.
BP faces extra $60bn in legal costs as US loses patience with Gulf clean-up
The oil disaster unfolding in the Gulf of Mexico could present BP with much higher costs than previously thought as a result of US government penalties of up to $60bn (�40bn), according to City analysts.
The penalties are in addition to BP's already huge bill for the clean-up mission, which stood at $760m yesterday, and potentially unlimited damages payable by the company to fishermen and other affected local communities. BP also faces billions of dollars of lost earnings as a result of its damaged reputation in the US, which could result in it being barred from bidding for future contracts.
The Guardian has obtained a confidential briefing, from a top-level US environmental lawyer who specialises in oil industry litigation, to stockbroker Canaccord, assessing the financial impact of impending legal action on BP.
He warned that, under US law, BP is liable for $1,100 in civil penalties for each spilt barrel of oil and gas, to be paid to the US federal and affected state governments. If BP is found to have acted with gross negligence � and there is no evidence so far that it has � this fine would rise to $4,300 for each barrel.
The issue of legal liability for the accident is complex, involving US federal and state laws. City analysts' calculations of the bill faced by BP have ignored the potentially ruinous cost of civil penalties.
As Johnny Carson used to say "I did not know that." The good news is they should have plenty of motivation to get the gusher stopped. Of course it remains to be seen if the Obama administration would have the guts to actual administer what could be the death penalty. I'm not too optimistic. Meanwhile BP seems pretty confident:
BP's chairman, Carl-Henric Svanberg, accepted that the accident had
damaged the company's reputation but said that critics should remember
that BP was "big and important" for the US."The US is a big and
important market for BP, and BP is also a big and important company for
the US," he said in an interview with the Financial Times.
Thom Hartmann asked an excellent question this morning - where are the Teabaggers? Their corporate handlers have them going after Obama but they have been silent when it comes to BP.
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