BP to pay for recklessness: Obama

President Barack Obama vowed to make BP pay for its “recklessness” in the Gulf of Mexico oil spill, saying he would order the company’s chairman to set up a compensation fund for victims.

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“Tomorrow, I will meet with the chairman of BP and inform him that he is to set aside whatever resources are required to compensate the workers and business owners who have been harmed as a result of his company’s recklessness,” Obama said in his first address from the Oval Office.

“And this fund will not be controlled by BP,” he vowed in his hard-hitting 20-minute address to the nation, flanked by the American flag and the presidential seal.

“In order to ensure that all legitimate claims are paid out in a fair and timely manner, the account must and will be administered by an independent, third party,” he stressed.

Obama has summoned BP chairman Carl-Henric Svanberg to the White House on Wednesday for talks on the crisis at, also expected to be attended by BP chief executive Tony Hayward.

In a sparse two-sentence reaction to the president’s speech, BP said: “We share the president’s goal of shutting off the well as quickly as possible, cleaning up the oil and mitigating the impact on the people and environment of the Gulf Coast.

“We look forward to meeting with President Obama tomorrow for a constructive discussion about how to best achieve these mutual goals.”

The statement avoided any mention of the compensation fund, which BP has so far refused to confirm it will set up, despite pressure from US lawmakers to set aside some $US20 billion ($A23.09 billion).

The White House said Obama would meet for 20 minutes with BP executives, and then deliver a statement to the press in the Rose Garden. Earlier, the White House Tuesday threatened to take over the claims process for victims of the Gulf oil spill, as it pressured BP to stop dragging its heels on setting up a multi-billion dollar damages fund.

“The best way to prevail on BP is to take the claims process away from BP,” White House spokesman Robert Gibbs told CBS television, addressing bitter criticism from Gulf residents that their livelihoods have been washed away.

But in a pre-emptive strike before the speech, the British energy giant said it had already paid out some 25,000 claims totalling $US63 million ($A72.73 million) — expected to rise to $US85 million ($A98.13 million) by the end of the week.

It also said it had speeded up the claims process and approved 90 per cent of initial claims for commercial large loss claims.

“Using an accelerated process BP approved payments of 337 checks for a total amount of $US16 million ($A18.47 million) to businesses that have filed claims in excess of $US5000, ($A5772)” BP said in a statement.

“The acceleration of commercial large claims payments will help ease the burden on impacted businesses by providing access to money in a short period of time,” it added.

The British energy giant also said it would begin issuing monthly advances based on estimates for a business’s monthly loss, and such payments would be made a month in advance for as long as the losses are incurred.

The sum would be arrived at by calculating the business’s costs, plus an extra 10 per cent, and deducting the expected revenues. “We hope that these changes will help those whose businesses and livelihood have been hurt by the oil spill,” said Darryl Willis, head of BP’s Claims Team.

“We are working hard to fine-tune our claims process so that it’s as simple, straightforward and effective as possible. We will keep doing everything we can to address the impact of the spill on the Gulf region.”


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