WASHINGTON (CN) – Two Democratic senators asked BP to suspend shareholder payouts until the oil giant knows the total cost of the Gulf oil spill, calling it “unfathomable” that BP would make normal dividend payments without a final tally of cleanup and liability costs.
Senators Charles Schumer of New York and Ron Wyden of Oregon wrote a letter to BP CEO Tony Hayward in response to reports that BP plans to promise last week not to skimp on dividend payouts because of the spill.
“We find it unfathomable that BP would pay out a dividend to shareholders before the total cost of BP’s oil spill cleanup is estimated,” the lawmakers wrote.
“While we understand the need to reassure shareholders that the disaster in the Gulf will not substantially impact BP’s long-term financial health, we are concerned that such action to move money off of the company’s books and into investors pockets will make it much more difficult to repay the U.S. government and American communities that are working around the clock to stem the damage caused by this devastating oil spill,” the letter states.
The lawmakers asked BP to consider its obligations to the families of the 11 workers killed in the disaster and to coastal industries and response crews before shareholders.
The senators requested that BP hold off on dividend payouts until it knows the total cost of the spill, which Credit Suisse said could reach $37 billion — $14 billion to pay claims and up to $23 billion for cleanup costs.
BP says it has already spent $1 billion in response costs and expects to spend $4 billion.