Tags: US | Oil | Spill | Liability

Federal Law May Limit BP Liability in Oil Spill

Tuesday, 04 May 2010 06:57 AM

 

Share:
  Comment  |
   Contact Us  |
  Print  
|  A   A  
  Copy Shortlink

A federal law may limit how much BP has to pay for damages such as lost wages and economic suffering in the Gulf Coast oil spill, despite President Barack Obama's assurances that taxpayers will not be on the hook.

A law passed in response to the 1989 Exxon Valdez spill in Alaska makes BP responsible for cleanup costs. But the law sets a $75 million limit on other kinds of damages.

Economic losses to the Gulf Coast are likely to exceed that. In response, several Democratic senators introduced legislation Monday to raise the liability limit to $10 billion, though it was not clear that it could be made to apply retroactively.

White House press secretary Robert Gibbs said Monday the administration's commitment was for BP to pay for all costs associated with the spill.

Obama said the same thing during a tour of the area Sunday. "Let me be clear: BP is responsible for this leak; BP will be paying the bill," the president said.

Kenneth Baer, spokesman for the Office of Management and Budget, also noted that if BP were found to have acted negligently in the spill or to have violated federal laws, the damages cap under the Oil Pollution Act would be lifted.

Baer said BP could also be held liable under additional federal or state laws.

"You can be sure that BP will be held accountable to the full extent of the law," he said.

Nevertheless, the existence of the liability cap might complicate Obama's commitments to make BP pay for numerous costs anticipated in the Gulf such as shortened fishing seasons and lost tourism. It is not clear how high those costs could rise.

"We're glad that the costs for the oil clean up will be covered, but that's little consolation to the small businesses, fisheries and local governments that will be left to clean up the economic mess that somebody else caused," said Sen. Robert Menendez, D-N.J., a sponsor of the legislation raising the cap, which the administration said it supported.

BP issued a fact sheet Monday committing to pay "all necessary and appropriate cleanup costs" as well as "legitimate and objectively verifiable claims for other loss and damage caused by the spill." A company representative did not immediately return a phone message seeking comment on whether claims would be paid out over $75 million.

Beyond the $75 million in law, the federal government also maintains an Oil Spill Liability Trust Fund supported by industry fees. It can make a total of $1 billion in payouts per incident to individuals, businesses and governments.

Roughly 2.6 million or more gallons has spilled into the Gulf since the April 20 blast that sunk an oil rig and killed 11 workers.

On Monday afternoon top administration officials, including Interior Secretary Ken Salazar, Homeland Security Secretary Janet Napolitano, economic adviser Lawrence Summers and energy adviser Carol Browner, met with BP CEO Tony Hayward and BP America Chairman and President Lamar McKay at the Interior Department.

The 90-minute meeting was closed to reporters, but officials said discussion centered ongoing response efforts, as well as an update on BP's mitigation plans for potentially affected Gulf Coast states. It was the latest in a series of meetings between administration officials and BP.

BP officials said little as they left the session.

"Very constructive dialog," Hayward told reporters as he and other BP officials got into a car.

Summers and Browner declined to comment.

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Share:
  Comment  |
   Contact Us  |
  Print  
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Retype Email:
Country
Zip Code:
Privacy: We never share your email.
 
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
Top Stories
You May Also Like

Google Building Fleet of Package-Delivering Drones

Thursday, 28 Aug 2014 23:16 PM

Google's secretive research laboratory is trying to build a fleet of drones designed to bypass earthbound traffic so pac . . .

GOP Slams Obama on ISIS: 'He Has Never Had a Good Strategy'

Thursday, 28 Aug 2014 20:52 PM

Republicans slammed President Barack Obama's admission Thursday that "we don't have a strategy yet" for battling the Isl . . .

Top Republicans Seek Strong Response to Russia in Ukraine

Thursday, 28 Aug 2014 22:40 PM

President Barack Obama on Thursday dodged the issue of whether Russia had invaded Ukraine, as top Republicans called for . . .

Most Commented

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved