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Tuesday 26th of May 2015

BP execs arrive at White House for talks

Story link: BP execs arrive at White House for talks by Kay Murchie
BP execs arrive at White House for talks

BP executives are currently in talks with US President Barack Obama at the White House to discuss the Gulf of Mexico oil spill clean-up costs.

In the Oval Office, Mr Obama is holding talks with the company’s chief executive Tony Hayward and chairman Carl-Henric Svanberg.

The President has described the spill as “the worst environmental disaster America has ever faced”.

Yesterday, Mr Obama said he will demand that BP set up an independently-managed fund to compensate those affected by the major oil spill.

There has been speculation that the company would suspend its dividend payments to shareholders to pay for the clean-up costs.

Oil has been leaking into the Gulf after an explosion on a BP oil rig on 20 April, which left 11 workers dead.

Two days later, oil began to leak into the Gulf of Mexico from the damaged well and since that time, BP has been battling to contain the leak.

It managed to place a cap over the leaking oil pipe earlier this month, and is now collecting some of the oil.

However, oil has already washed ashore in Gulf coast states, affecting businesses and wildlife, and the impact of the disaster has sent the company’s shares into freefall.

Meanwhile, in a speech yesterday, the President said: “I will meet with the chairman of BP and inform him that he is to set aside whatever resources are required to compensate the workers and business owners who have been harmed as a result of his company’s recklessness.

“And this fund will not be controlled by BP. In order to ensure that all legitimate claims are paid out in a fair and timely manner, the account must and will be administered by an independent third party,” he added.

BP responded and said: “We look forward to meeting President Obama for a constructive discussion about how best to achieve these mutual goals.”

In related news, credit rating agency Fitch yesterday downgraded BP’s rating by six notches, from AA to BBB.

Fitch said it was concerned about BP’s ability to repay its debts as the clean-up operation and legal costs soar.

So far, BP has spent $1.6 billion (£1.1 billion) in its effort to contain the major oil spill.


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