BP Well Costs Move About $11 Billion

October 1, 2010 by Douglas A. McIntyre

BP plc (NYSE: BP) said it has pledged collateral to cover the costs of the independent escrow fund meant to cover claims and liabilities from the Deepwater Horizon spill. That is no news. But BP also declared it has spent over $11 billion on the clean-up so far, which is a staggering amount.

BP announced that it has pledged certain Gulf of Mexico assets as collateral for the $20 billion Deepwater Horizon Oil Spill Trust which was set up to pay legitimate claims arising from the April 20 incident.

BP has also started the process of dismantling and recovering containment equipment and decontaminating the vessels that were in position at the wellsite. The cost of the response to September 29 amounts to approximately $11.2 billion, including the cost of the spill response, containment, relief well drilling, static kill and cementing, grants to the Gulf states, claims paid and federal costs.

Douglas A. McIntyre