BP agrees to $20 billion spill fund, cuts dividend
Under intense pressure from President Barack Obama, BP Plc agreed on Wednesday to set up a $20 billion fund for damage claims from its huge Gulf of Mexico oil spill and suspended dividend payments to its shareholders.
The deal gave Obama his most tangible success since the crisis began 58 days ago and came after weeks of criticism of his handling of the disaster. It also eased U.S. pressure on BP, whose share price has withered amid uncertainty over the spill's cost to the British energy giant.
Obama announced the agreement after White House officials held four hours of talks with BP executives, who emerged to offer an apology to the American people for the worst oil spill in U.S. history.
"I do thank you for the patience that you have during this difficult time," BP Chairman Carl-Henric Svanberg said. "I hear comments sometimes that large oil companies are greedy companies who don't care. But that is not the case in BP. We care about the small people."
Svanberg promised to make sure damage claims are handled swiftly and fairly.
Chief Executive Tony Hayward, the public face of BP's response to the disaster, will appear on Thursday at a congressional hearing where he will face intense scrutiny over events leading up to the spill and BP's cleanup of the mess.
An April 20 explosion on an offshore rig leased by BP killed 11 workers and ruptured a deep-sea well. The ensuing spill has fouled 120 miles of U.S. coastline, imperiled multibillion-dollar fishing and tourism industries and killed birds, sea turtles and dolphins.
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