BP Endures Heavy Loss in Wake of Oil Spill

It’s been dubbed the worst environmental disaster in history. The cost of the Gulf oil catastrophe has resulted in a colossal loss of $17.2 billon in the second quarter.

Because of the spill BP had to charge $32.2 billion over the quarter. As agreed, the company set up a $20 billion fund to cover disaster damages. The company still lays claim to the fact they were not grossly negligent and at fault for the explosion that killed 11 and caused a well to leak.

The people have formed an opinion on this, but it isn’t in the people’s hands. The courts will make the call as to whether BP was negligent.

If BP is found negligent the company will be responsible for all of the fines and damages associated with the oil spill. Otherwise, they pay a portion. The other portions are paid by the two co-owners of the well, Anadarko Petroleum and Mitsui Oil Exploration.

Experts agree that BP is covering its bases. What the company is doing is making sure they are able to cover their share of damages. This proactive stance will help the market to relax a bit about the costs of clean-up.

The finances were far from where they sat a year ago. In 2009 the company had a net profit of $4.4 billion for the second quarter.

In an effort to turn the tide, BP also announced it was replacing CEO Tony Hayward with Robert Dudley who has been involved in disaster relief since June.

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Posted by CarolCostello on Jul 27 2010. Filed under Business, Featured News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry