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BP Links Compensation With Continued Oil Production In The Gulf
BP has managed to link the fate of its $20 billion oil spill victims compensation fund with its continued ability to pump oil from the Gulf of Mexico.
The voluntary trust agreement negotiated with the Department of Justice is not with the British-based multinational, or even with BP America, but with a fairly remote subsidiary, BP Exploration & Production Inc. (BPEC) -- a Delaware corporation that operates BP's Gulf oil leases. The voluntary trust agreement
negotiated with the Department of Justice is not with the British-based
multinational, or even with BP America, but with a fairly remote
subsidiary, BP Exploration & Production Inc. (BPEC) -- a Delaware
corporation that operates BP's Gulf oil leases.
So if BP's drilling revenues from the Gulf suddenly vanished, so, presumably, would the compensation fund, said Tyson Slocum, director of Public Citizen's Energy Program.
"This is a very advantageous agreement from BP's point of view," Slocum told the Huffington Post. "Because their big concern is that the Deepwater Horizon incident would result in sanctions that would significantly reduce BP's involvement in lucrative Gulf operations."
"But if you tie the compensation fund to Gulf of Mexico production, you are helping to guarantee BP's continued involvement in that market," he said.
Technically, the agreement (exclusively available on the Huffington Post) sets up yet another subsidiary to hold the collateral for the compensation fund. That collateral is to consist of "first priority perfected security interests in production payments pertaining to the Grantor's U.S. oil and natural gas production."
"It will create a problematic situation if one arm of the federal government is attempting to hold BP criminally accountable and includes sanctions that would include loss of leasing rights -- while another arm of the administration is seeking to enforce the trust agreement," Slocum said.
Although the same people would not be making decisions about criminal sanctions and victim compensation, Slocum acknowledged, they all ultimately work for the same person.
"The president's objective I think all along has been to secure financing from BP," said Slocum. "Secondary to that is holding this company criminally negligent for the death of 11 workers and for the largest environmental disaster in American history."
Now, he said, "I think there is a conflict between the two."
11 Comments so far
Show AllAnother "deal" which favored corporate interests first. I'm not even surprised anymore.
Froomkin sez: "Although the same people would not be making decisions about criminal sanctions and victim compensation, Slocum acknowledged, they all ultimately work for the same person."
***
ie, the same people WILL be making the decisions.
Which is all moot anyway ... BP will not tap this fund until the claimants first win a court verdict, then manage to stay alive through 20 or 30 years of appeals brought by BP against that ruling (see Valdez, Exxon).
If what you write is true, Obama is either dumber than a banana slug, or he is the most corrupt politician since Reagan, Bush, Clinton, Bush.
All part of paying 1/2 of the working class to kill the other.
BP will pay only if they are allowed to kill again?
No way!!! Take over all BP assets and permanently ban drilling the Gulf.
BP's world wide assets would not begin to pay for the damage they have already done.
Beyond nightmares? BP is in line for a Nobel Prize for CROOKEDNESS.
First comes the Google/Verizon announcement that the Internet now belongs to them and next BP decides how their victim compensation will play itself out. Brother, there oughta be a law! Oh wait, I forgot, there are any number of laws on the books to check rampant corporate self-determination at taxpayer expense. If someone could just remember where they were put, or who used them last?
Can anyone write some new ones?
How is it possible to answer such magnitude of arrogance on the corporation's part? Or the complacency of the populace, for that matter? I fear this global economy is long beyond repair.
Congress needs to pass legislation that makes BP accountable for ALL the clean-up expenses and revenue losses as a result of the oil spill
This smacks of the recent talk of BP divesting their holdings/leases at Prudhoe Bay Alaska.
I suspect it may be advantageous to them since they have been in Alaska State Court oweing the State ONE BILLION dollars in lost oil revenue from the 2006 Prudhoe Bay Transit Line Leaks, which to date is the Largest spill in Greater Prudhoe Bay's history..
They also still owe the Federal Government $$$ for that same spill but this has not been mentioned much that I know of...If the Government were serious, BP would have been de-barred and lost their vendors licence with the US Govt. instead of the puny 20 million dollar fine they walked with. Bp knew this the whole time that those lines were rotting out for not being pigged. I can still recall the big joke in the control room through out the years, getting permits from the operators, the Operators asking us "why do you keep inspecting the Pig Launchers, when the lines haven't been inspected for years"???
The Oil Companys are infamous for dragging cases out through the court system...Time serves them well...If they had been de-barred or at least fined to the max in Alaska, then just maybe they would have been more responsible in the Gulf.
They will SCREW the people of the Gulf, just like BP and EXXON screwed the people of Prince William Sound...There is NO Justice for people against these cold blooded Corporations in this country, there never was and there never will be...
Been snookered again. Damn.
As time goes by we will find that there are numerous conditions and loop-holes in the agreement that BP agreed to. These will diminish or eliminate the payments BP pays to those damaged by its careless disregard for the environment.
Of course, all of these gimmicks to rip off those who suffer from BP's greed are winked at by our so-called representatives in Congress and The Whore House, er, I mean The White House.