Gulf Coast Disaster: Afternoon News Roundup, June 16

Highlights in this issue:

- BP put $20 billion in a damage escrow account; $100 million for unemployed oil workers
- Kenneth Feinberg named to run the independent escrow fund
- BP suspends dividend payments
- BP sets up 2nd containment system 


Afternoon summary:

A very big day at the White House
Wednesday wasn’t a good day for BP, you could tell by the sickening look on BP CEO Tony Hayward’s face as he walked toward the White House for his meeting with President Obama. But by mid-day Wednesday, we learned some of the reasons why Hayward didn’t look so great. Under pressure from President Obama, BP is directing that at least $20 billion will be deposited in an escrow account to pay for oil spill claim, and there is no cap on the fund which could go much higher if needed. And BP is creating a $100 million fund to compensate oil industry workers left jobless by this disaster. BP is suspending dividend payments for the rest of this year, too. A pretty good day for Obama and the people of the Gulf coast, a bad one for BP.

Quotable Quote
"We have agreed today with the president a framework that should assure the American people that we mean what we say," said BP chairman Carl-Henric Svanberg. "We will repair the damage to the region."


National News

Politico: BP agrees to $20 billion fund for spill claims; $100 million fund for unemployed Gulf oil workers
BP will set aside $20 billion to pay the victims of the massive oil spill in the Gulf with no cap and a $100 million fund for unemployed oil workers. The independent $20 billion fund will be led by lawyer Kenneth Feinberg, who oversaw payments to families of victims of the Sept. 11, 2001, terrorist attacks. “It is not a floor or a cap” for BP which is responsible for all economic damages, according to White House spokesman Robert Gibbs.

Read more:
http://www.politico.com/news/stories/0610/38612.html

Check this one out
http://www.nytimes.com/2010/06/17/us/politics/17obama.html?hp

See this one, too
http://www.nola.com/news/gulf-oil-spill/index.ssf/2010/06/bp_to_create_100_million_fund.html

And see this article with picture of BP executives entering White House
http://content.usatoday.com/communities/greenhouse/post/2010/06/bp-oil-spill--1/1


The Hill: BP suspends dividend payments for rest of year
In a decision expected to anger British pensioners and investors everywhere, BP announced Wednesday that it would pay no dividends for the remainder of this year. The announcement came after BP executives met with President Obama to set up a recovery fund for those individuals and businesses injured by the Gulf oil spill. In a statement, BP said: “The Board remains strongly committed to the payment of future dividends and delivering long term value to shareholders... The Board believes that it is right and prudent to take a conservative financial position given the current uncertainty over the extent and timing of costs and liabilities relating to the spill.”

Read more:
http://thehill.com/blogs/on-the-money/corporate-governance/103609-bp-executive-says-no-dividend-this-year-

The Hill: Ken Feinberg – an expert who is fair – in charge of BP compensation fund
In one significant act, President Obama has named Ken Feinberg as the man in charge of decided how much money people will get from damages for the Gulf oil spill. He’s an independent person with high marks for fairness. He headed the Sept. 11, 2001, Victim Compensation Fund; six years later, he ran the Hokie Spirit Memorial Fund after the shooting tragedy at Virginia Tech.

Read more:
http://thehill.com/opinion/editorials/103421-kenneth-feinberg-for-spill-czar

Sun Times: Cabinet secretaries join Obama in meeting with BP
President Obama had a few heavy hitters with him when he met Wednesday with BP executives and hammered out a deal to help the Gulf coast recover from the worst environmental disaster in U.S. history. They included Vice President Biden and the secretaries of the Department of Homeland Security, Energy, Commerce and Labor.

Read more:
http://blogs.suntimes.com/sweet/2010/06/rahm_emanuel_valerie_jarrett_i.html#more


AP: 2nd containment system set up early Wednesday
BP announced Wednesday morning that oil and gas is flowing through a second containment system attached to the Deepwater Horizon rig's failed blow out preventer.

Read more:
http://www.todayonline.com/BreakingNews/EDC100616-0000275/BP-steps-up-efforts-to-capture-more-oil-through-2nd-containment-device-at-US-Gulf-seafloor


AP: Oil spill and Katrina
When a promise cannot be kept: President Barack Obama's vow to leave the Gulf Coast in better shape than before the oil spill sounds familiar. It eerily echoes President George W. Bush's pledge after Hurricane Katrina to rebuild New Orleans "higher and better." Bush wasn't able to keep that 2005 promise. And Obama probably won't be able to keep his, either, the AP reports.

Read more by Tom Raum:
http://www.google.com/hostednews/ap/article/ALeqM5iiN5HDYe--0SHk6-fdiFlt9bgyQAD9GC7PMO1


New York Times: Ad for dish detergent becomes part of story
The timing was surreal. Dawn, the dish detergent, was featured in commercials since last summer depicting wildlife rescuers washing birds soiled by oil spills. And then the Deepwater Horizon happened. Even ad execs say it feels a bit strange, but it is a marketing opportunity.

Read more from Leslie Kaufman
http://www.nytimes.com/2010/06/16/science/earth/16dawn.html?hp


Wall Street Journal: Cost of Protecting BP Debt Jumps to Highest Level Ever
The cost of protecting BP PLC's debt soared Wednesday to its highest level ever after President Barack Obama's criticisms and Tuesday's ratings downgrades.

Read more:
http://online.wsj.com/article/SB10001424052748704198004575310643340691362.html?mod=WSJ_Currencies_RIGHTMoreInMarkets


Regional

AP: Gulf Residents on Obama: Actions Mean Everything
President Obama was trolling the Gulf coast in his four visits looking for votes. But his trips also breathed some hope into distraught residents facing economic disaster from the Gulf oil spill.

Read more:
http://www.cbsnews.com/stories/2010/06/16/national/main6587368.shtml

BBC: Alabama 'battling' to keep oil spill at bay
It’s a long way from the UK to the beaches of Alabama, but the BBC is covering the Gulf oil spill like it’s happening in the North Sea. In a story about the Alabama coastline, the news service is reporting that Gulf Shores, Ala., is desperate to protect its shoreline of 32 miles of bleached white sand which attracts tourists to the town

Read more:
http://news.bbc.co.uk/2/hi/programmes/world_news_america/8741877.stm

Feature

Houston Chronicle: Mississippi losing $120m in lost tourism from oil spill
This is no nickel-and-dime disaster. The costs are being measured in millions right now and likely billions shortly. The numbers for Mississippi aren’t pretty either when it comes to revenue losses from the Gulf oil spill. Researchers at the University of Southern Mississippi spill will cost Mississippi's coastal counties nearly $120 million in lost tourism and service industry revenues this summer season, even though the state's beaches have not been hit by crude, Tourism has already been hit. The study says reservations at non-casino hotels are down 50 percent.

Read more:
http://www.chron.com/disp/story.mpl/ap/business/7055885.html


Graphics

Ø  Tracking the Gulf oil spill
http://www.cnn.com/2010/US/04/29/interactive.spill.tracker/index.html?hpt=T1

Ø  NOAA Forecast Trajectory
http://response.restoration.noaa.gov/book_shelf/2192_TMF72-2010-06-14-2100.pdf