BP Could Regret Lack Of Indemnity Coverage

With thousands of barrels of oil still spreading in the Gulf of Mexico in the wake of the explosion on the Deepwater Horizon rig, BP, the company responsible, will be forced to pay out huge sums of money in compensation.

Thus far, the company has received 15,000 claims and has paid out on 2,500. BP is committed to paying all claims that it deems to be legitimate but does not have indemnity coverage, so will need to pay its own way.

While US law imposes a $75m limit on what energy companies can be held responsible for, experts are suggesting that total liability may be measured in billions with damage to property on a vast scale and huge commercial loss an inevitable by-product of that.

When Barack Obama visited Louisiana last week, he was quick to blame BP, stating that the oil company should foot the bill for what he considers could yet be seen as one of the largest environmental disasters. Louisiana has been particularly badly affected, but with oil still leaking, the area under threat is vast.

BP is currently containing the flow, funnelling much of it into a nearby tanker, but has not yet managed to stop it – something they hope to achieve in the coming days.

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