BP could have to pay more than $18bn for the Gulf of Mexico disaster

Gulf of Mexico disaster could cost BP more than $18bn

Oil giant admits in annual report that it is impossible to determine what the final bill will be
The oil rig ‘Deepwater Horizon’ catches fire, Port of Venice, Gulf of Mexico

By Katherine Rushton6:23PM GMT 06 Mar 2014CommentsComments

BP has warned that fines over the Gulf of Mexico oil disaster in 2010 could exceed the $18bn it is braced for.
The oil giant said in its annual report, published on Thursday, that its “potential liabilities…cannot be fully estimated”, and that it is impossible to determine what the final bill will be. It said that it has only been able to offer “current best estimates of expenditures”, but that there are “future expenditures for which it is not possible to measure our obligations reliably”.

The US government could fine the oil giant up to $18bn for its part in the Gulf of Mexico spill, which killed 11 men and wreaked billions of dollars of damage to US households and businesses. That figure has already spiraled far above the $3.5bn BP originally put aside to settle the case, thanks to a steady of tide of claims from people claiming their livelihoods were impacted by the spill.

BP warned that the company could face additional lawsuits, lose business as a result of the damage to its reputation, and miss out on opportunities because of the heavy burden that its legal expenses are placing on its cash flow.

The annual report also disclosed that Bob Dudley, BP’s chief executive, saw his pay triple last year from $2.6m to $8.7m, including bonuses. Mr Dudley was not in charge at the time of the Deepwater disaster.

The company said that it had made “strong progress” under Mr Dudley’s leadership, and that his remuneration was “directly dependent…on performance”.

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