BP: Fund overseer offering too much money

Feb. 17, 2011 at 5:09 PM
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HOUSTON, Feb. 17 (UPI) -- The administrator of the $20 billion fund to pay claims for the BP Gulf of Mexico oil spill is offering victims too much money, BP PLC said Thursday.

Kenneth Feinberg, named last June by BP and approved by the White House to administer the BP Deepwater Horizon Disaster Victim Compensation Fund, plans payments that far exceed the extent of likely future damages because they overstate the potential for future losses, BP said in a 25-page document posted on the fund's Web site, www.gulfcoastclaimsfacility.com.

There is "no credible support for adopting an artificially high future loss factor based purely on the inherent degree of uncertainty in predicting the future and on the mere possibility that future harm might occur," BP's statement said in an attachment posted in the site's "Comments on Proposed Methodology" section.

Feinberg has given out more than $3.5 billion so far in emergency money to people affected by the seafloor gusher, which began with a deadly explosion April 20 and continued until July 15. The spill released an estimated 206 million gallons of crude oil and is considered the largest accidental marine oil spill in petroleum industry history.

Some 100,000 people have filed for a final settlement. Another 90,000 opted to take a quick-pay process, settling all claims with a payment of $5,000 to individuals and $25,000 to businesses, The New York Times said.

Final payments are to begin after a two-week public comment period, which ended Thursday, the day of BP's posting.

BP's comments weaken arguments that Feinberg, while claiming to be independent, is actually working in the oil company's interests, the Times said.

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