BP Officials Meet With Obama, Agree To $20B Fund

President Obama and BP executives met Wednesday at the White House in their first face-to-face meeting since the spill began almost two months ago. It produced a big result: The president and BP agreed that the oil giant would put $20 billion in an escrow fund to pay the claims of Gulf residents hurt by the spill.

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President Obama met with the chairman and chief executive of BP today at the White House. It was their first face-to-face meeting since the oil spill in the Gulf of Mexico began two months ago, and it produced a big result. The president and BP agreed that the oil giant would put $20 billion into an escrow fund to pay the claims of the Gulf residents hurt by the spill.

NPR national political correspondent Mara Liasson reports.

MARA LIASSON: After trying with mixed success to find the right approach to the unfolding environmental disaster in the Gulf, the last 24 hours has brought a flurry of action by the president.

Last night, in his first-ever Oval Office address, he laid out his plan to contain and repair the damage from the spill. This morning, he had a four-hour meeting with BP, and the company agreed to a fund whose size, $20 billion, was on the high-end of White House wish lists.

BARACK OBAMA: This $20 billion will provide substantial assurance. The claims people and businesses have will be honored. It's also important to emphasize this is not a cap. The people of the Gulf have my commitment that BP will meet its obligations to them.

LIASSON: The fund will be administered not by the government or by BP, but by an independent third party.

BLOCK: Ken Feinberg, currently the pay czar for the bank bailout fund and formerly the special master for the government fund that compensated victims of the 9/11 attacks. And the president said...

OBAMA: Additionally, BP voluntarily agreed to establish $100 million fund to compensate unemployed oil rig workers affected by the closure of the deepwater rigs.

LIASSON: This $100 million fund, the White House hopes, will allay some of the anger in the Gulf over the president's decision to order a six-month moratorium on deepwater drilling while the causes of the spill are investigated.

After he finished reading his remarks from the teleprompter, Mr. Obama shared what he had told BP's chairman, Carl-Henric Svanberg, about the people he had met in the Gulf.

OBAMA: So I emphasized to the chairman that when he's talking to shareholders, when he is in meetings in his boardroom, to keep in mind those individuals, that they are desperate. That some of them, if they don't get relief quickly, may lose businesses that have been in their families for two or three generations. And the chairman assured me that he would keep them in mind. That's going to be the standard by which I measure BP's responsiveness.

LIASSON: Minutes after the president spoke, Chairman Svanberg was in the White House driveway, talking in personal terms about Mr. Obama, attesting to the frustration and concern the president had for the people in the region.

CARL: He cares about the small people and we care about the small people. I hear comments sometimes that large oil companies are greedy companies who don't care, but that is not the case in BP. We care about the small people.

LIASSON: Svanberg said BP's board decided today it will not issue any dividends for the rest of the year. That unexpected decision, Svanberg's contrite words, and perhaps his Swedish accent, all added up to possibly the best PR BP has had in the U.S. in 57 days, conveying the impression at least that he wasn't a greedy, corner-cutting capitalist after all.

SVANBERG: I would like to take this opportunity to apologize to the American people. Through our actions and commitment, we hope that the over long term, that we will regain the trust that you have in us.

LIASSON: After almost two months of mixed signals about exactly what the relationship between the White House and BP really was, President Obama seems to have settled on an approach that treats BP as not just a punching bag but also an unavoidable and even useful partner.

Mara Liasson, NPR News, the White House.

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