The BP oil spill bill:
BP said the disaster, now into its tenth week, had already cost it $2bn. As of last night, the British company had paid out only $104m to claimants. In all, 64,000 demands have been submitted so far, totalling $600m. That pace will, however, only accelerate as oil continues to spew from the broken well-head, contaminating an ever-wider area of the Gulf.
From the looks of things BP will probably not have any trouble funding it:
BP is eyeing relatively modest new bank lending lines and is not planning bond sales or new increases in asset sales to fund its Gulf of Mexico oil spill clean-up, sources familiar with the company’s thinking said on Monday.
BP has considered a number of different scenarios to raise additional cash, should the need arise, such as additional asset sales and a potential bond offering.
And furthermore it also seems that even if BP were to declare bankruptcy, creditors wouldn’t mind.
There are no bank-style bailouts here, but structurally seems to be no deterrents either. Moral hazard just the same.
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