BP Gets First Bill,|for $69 Million

WASHINGTON (CN) - President Obama sent BP its first bill for $69 million and criticized BP chief Tony Hayward for his recent gaffes. "I don't think a CEO needs to tell people in the Gulf that there's not any pollution or (that) he'd like his life back," said White House Press Secretary Robert Gibbs.

The president canceled a visit to Asia late last week so he could go to the Gulf region again and visit the worst spill in U.S. history. Obama called Prime Minister Kevin Rudd of Australia and President Susilo Bambang Yudhoyono of Indonesia Thursday evening to express his regret for delaying his trip and promised to hold bilateral meetings with the leaders at the G-20 meeting in Canada in late June.

The government's $69 million bill to BP covers 75 percent of the federal money spent on the spill so far, collectable under the Oil Pollution Act. BP has until July 1 to pay back the funds.

The bill breakdown includes $29 million for National Guard deployment, $29 million for other federal personnel, aircraft and vessel support, $7 million for state funding, and $4 million for Defense Department assistance. The taxpayer money was taken out of the Oil Spill Liability Trust Fund.

"These bills do not include any other costs for which BP and the other responsible parties are liable to any other party," the White House said in a statement.

The administration said it will continue to regularly bill BP to recover taxpayer funds.

"We will hold BP responsible throughout this process," Gibbs told reporters Thursday.

"They have an obligation to fix the hole that's on the bottom of the ocean floor," he said. "We have an obligation as the federal government to ensure that the laws of this country have been and are upheld."

In response to criticism that Obama has not displayed enough emotion over the spill, Gibbs said, "If jumping up and down and screaming were to fix a hole in the ocean, we'd have done that five or six weeks ago. We'd have done that the first night. ... But pounding on a podium isn't going to fix a hole in the ocean.

"I think what the American people and the citizens of the Gulf are expecting are results. And I think that's what the president will be measured by. I'll leave emotional psychiatry to others," he said.

BP announced Friday that it successfully placed a containment dome over the gushing wellhead and reported that oil and gas was being funneled to the sea surface and processed on the drillship Discoverer Enterprise 5,000 feet above the broken wellhead.

BP says it won't know for one or two more days how much oil and gas is being captured using the containment system. BP sliced through the damaged riser pipe Thursday with shear cutters used by underwater robotic vehicles, which created a jagged edge that could complicate fitted placement of the dome. As a result, oil and gas may continue to rush out around the dome.

"All of these operations are complex, involve risks and uncertainties, and have to be carried out by remotely operated vehicles at 5,000 feet under water," BP said in a statement. "Systems such as the ... containment cap never before have been deployed at these depths and conditions. The containment system's efficiency, continued operation, and ability to contain the oil and gas cannot be assured."

BP also said it is continuing to drill two relief wells, the first of which is estimated to be completed around August.

Hayward, BP's top executive, told shareholders Friday that the spill was the company's "top priority," along with rebuilding trust and confidence in the company.

BP says it has already spent more than $1 billion in response, cleanup and well-drilling costs. The company says it expects to pay the majority of response, containment and cleanup costs in 2010.

"Spending at this rate is expected to continue for some time beyond successful completion of work to stop the flow of oil from the damaged well," BP said in another statement.

"The longer-term costs of environmental remediation, claims and litigation are not predictable at this stage, but they will be sizeable and are likely to be spread over many years," the company said. "We will meet our obligations both as a responsible company and also as a necessary step to rebuilding trust in BP," the company said. "This is in the interest of all our stakeholders."

BP said it has significant cash flow from the current oil trade as well as a strong asset base that includes 18 billion barrels of oil in reserves, which gives it "significant flexibility in dealing with the costs of this incident."

"We will stand by our obligations," Hayward added. "We will halt this spill and put right the damage that has been done. We will rebuild the confidence of the American people and the world in BP."

Hayward announced that the company would create a separate organization to manage long-term response to the spill, headed by Managing Director Bob Dudley, who has been a constant media presence during the crisis.

"I remain personally committed to making this right," Hayward stated.

But Gibbs sounded critical of Hayward during a press briefing Thursday. "I don't think a CEO needs to tell people in the Gulf that there's not any pollution or (that) he'd like his life back," Gibbs said, referring to Hayward's comment in May that the environmental impact of the spill would be "very, very modest" and his statement last Sunday, "You know, I'd like my life back."

"There's 11 people that we'd all like to have their lives back that were killed the very first night of this incident," Gibbs said. "And the harm that's being done there will take years to fix."

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.

Email *

Submit