Ted Kaufman - United States Senator for Delaware

Sens. Carper and Kaufman, Democratic Caucus Call on BP to Provide Full and Swift Reimbursement for All Damages Associated with Oil Spill in Gulf

June 14, 2010

WASHINGTON - Today Sens. Tom Carper and Ted Kaufman (both D-Del.) joined their colleagues in the Democratic Caucus in sending a letter to BP Chief Executive Officer Tony Hayward demanding full and swift reimbursement for all damages, immediate and long-term, caused by the oil spill in the Gulf.

While the Senators recognized BP's promise to reimburse the American people in full, they reminded the oil company of lessons learned from the Exxon Valdez tanker spill in Alaska's Prince William Sound. After the 1989 spill caused more than $7 billion in damages, Exxon fought their financial liability every step of the way. Ultimately, Exxon ended up paying only a fraction of the billions of dollars in damages it had caused many years after the spill.

"The damages caused by your company are far reaching. While much is already visible today, history proves the full extent of the destruction will not be discovered for months or even years," wrote the Senators.

In an effort to prevent history from repeating itself, the Senators called for BP to establish a special account of $20 billion to be used to pay for clean-up costs and economic damages.

"Establishment of this account would serve as an act of good faith and as a first step towards ensuring that there will be no delay in payments or attempt to evade responsibility for damages. Although creating this account at this level in no way limits BP's liability, we believe it will do more to improve BP's public image than the costly public relations campaign your company has launched," wrote the Senators.

In the letter, the Senators informed BP that Congress is currently gathering information and holding hearings in order to develop evidence-based legislative solutions to address the Deepwater Horizon disaster. Sen. Carper, Chairman of the Federal Financial Management subcommittee, will hold a hearing this Wednesday, June 16th, 2010 to assess how much money the federal government has spent in responding to the oil spill, and how these expenses will be recouped. The hearing will also explore potential vulnerabilities of the current claims processes and the future viability of the Oil Spill Liability Trust Fund. Planned witnesses include officials from BP, Transocean, National Pollution Funds Center, and the Government Accountability Office.

Sens. Carper and Kaufman noted, "It is essential that we guarantee that BP pay all of the costs of this horrific environmental and economic disaster they caused."

A copy of the letter follows:

Mr. Tony Hayward

Group Chief Executive, BP p.l.c

c/o BP America Inc.

4101 Winfield Road

Warrenville, IL 60555

Dear Mr. Hayward:

We are writing to express our profound concern over the Deepwater Horizon oil disaster and our deep regret for the severe consequences the continued outflow of oil into the Gulf of Mexico is having on our nation and the way of life for millions of Americans. This tragedy has already taken the lives of 11 men, wounded 17 others, and caused millions of dollars in damages. The oil slick resulting from the spill stretches across 2,500 square miles and has damaged miles of environmentally sensitive beaches and marshes stretching across four states. Although this disaster continues to unfold, it is already very clear we are facing a catastrophe of historic proportions that will take decades to fully rectify.

The damages caused by your company are far reaching. While much is already visible today, history proves the full extent of the destruction will not be discovered for months or even years. For example, it is already evident that fisherman, shrimpers, the tourist industry, and the secondary industries that support them will sustain billions of dollars in losses. We can also expect that marine and wildlife habitats will be destroyed, estuaries and wetlands will be decimated, and bird, fish, and animal populations will be devastated.

While we are pleased that BP has admitted liability for these damages and vowed to provide full remuneration for economic losses and clean-up costs, history has taught us that corporations often fail to live up to their initial promises. After the Exxon Valdez tanker spilled more than 11 million gallons of oil into Alaska's Prince William Sound, damages totaled more than $7 billion; although Exxon continued making massive profits after the accident, it fought liability at every step and ultimately paid far less than the billions of dollars worth of damages it had caused many, many years later.

Congress is currently gathering information and holding hearings in order to develop evidence-based legislative solutions to address the Deepwater Horizon disaster. Although legislative action is forthcoming, the damages are immediate. In order to ensure BP fully and quickly covers the costs of this disaster, we are calling on BP to immediately establish a special account of $20 billion, administered by an independent trustee, to be used for payment of economic damages and clean-up costs. Establishment of this account would serve as an act of good faith and as a first step towards ensuring that there will be no delay in payments or attempt to evade responsibility for damages. Although creating this account at this level in no way limits BP's liability, we believe it will do more to improve BP's public image than the costly public relations campaign your company has launched.

We appreciate your interest in fully and quickly reimbursing those who have been injured by your actions. We believe the establishment of the $20 billion account to compensate victims and provide for clean-up is a useful first step for demonstrating that BP intends to meet its commitments. In light of the urgency of this matter we ask the courtesy of your response no later than June 21, 2010.

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