BP says that its estimated $7.8 billion settlement over the oil spill disaster completes its commitment to citizens and businesses along the Gulf Coast to “make it right” after its rig exploded on April 20, 2010, killing 11 men and dumping over 200 million gallons into the Gulf of Mexico.
In its press release, the BP Group CEO Bob Dudley declared the proposed settlement represented significant progress toward resolving issues from the spill.
“From the beginning, BP stepped up to meet our obligations to the communities in the Gulf Coast region, and we’ve worked hard to deliver on that commitment for nearly two years,” said Dudley.
It shouldn’t have taken two years to settle with the victims of their disaster. BP established in June 2010 the $20 billion trust after the media began showing our beaches covered with oil. Locals were told that it rescued their businesses
However, the claim process was a nightmare. Businesses dependent on the summer season were barely keeping their doors open. People fell behind on their mortgages. BP hired attorney Ken Feinberg and the Gulf Coast Claims Facility (GCCF) was formed.
Feinberg had handled claims for the 9/11 tragedy, Agent Orange and the Virginia Tech massacre. In its first three weeks, the GCCF approved 16,000 claims and made payments in excess of $185 million, which was more money than BP distributed in the prior three months.
However, there were still hundreds of thousands of claims mired in red tape and seemingly endless document trails. When I caught up with Feinberg in February 2011, he admitted that he had underestimated the volume of claims. The GCCF had paid out $3.37 billion, but still had 488,534 unique claimants to process.
The question that Feinberg and BP wouldn’t answer to my satisfaction was why didn’t they devote more resources to processing the claims. After all, the trust fund was $20 billion. Instead, the claims process dragged on. Clearly, the BP strategy was to hold out as long as possible, forcing court dates to be set and delaying a settlement until the eve of the trial.
So, now we have a proposed settlement, which isn’t additional money to help the Gulf Coast. No, the $7.8 billion will be paid from the original $20 billion trust fund, which has only paid out $6.1 billion as of March 2. BP saved itself nearly $6 billion that it can spend on more advertising on how it has made good on its promises.
No, I still refuse to believe BP is our friend.