Behind the Scenes w/Obama and BP

From the Wall Street Journal.

Despite being put under pressure by the U.S. government to pay for the oil-spill aftermath, BP has succeeded in pushing back on two White House proposals it considered unreasonable even as it made large concessions, according to officials familiar with the matter.

BP said costs related to its oil-spill response had reached $2 billion as it continues work to contain the leak and to pay claims for damages.

BP last week agreed to hand over $20 billion—to cover spill victims such as fishermen and hotel workers who lost wages, and to pay for the cleanup costs—a move some politicians dubbed a "shake down" by the White House. Others have portrayed it as a capitulation by an oil giant responsible for one of the worst environmental disasters in history. A truer picture falls somewhere between.

The fund is a big financial hit to BP. But behind the scenes, according to people on both sides of the negotiations, the company achieved victories that appear to have softened the blow.

BP successfully argued it shouldn't be liable for most of the broader economic distress caused by the president's six-month moratorium on deep-water drilling in the Gulf of Mexico. And it fended off demands to pay for restoration of the Gulf coast beyond its prespill conditions.

After the high-profile meeting of administration and BP officials on Wednesday, it was in the interest of neither to discuss such details. BP wanted to look contrite and to make a grand gesture, and the White House wanted to look tough.

President Barack Obama came away touting how BP's money would be handed over quickly and impartially to those hurt by the spill. Not only did BP earmark the $20 billion fund but it promised an additional $100 million for Gulf workers idled by the drilling moratorium.



The drilling industry estimates the moratorium will cost rig workers as much as $330 million a month in direct wages, not counting businesses servicing those rigs like machine-shop workers.

BP and its defenders argue that the moratorium was a White House policy decision for which it shouldn't be responsible. The final deal was structured to limit the company's exposure to such claims.

BP negotiators also said the company won't pay for Mr. Obama's pledge to restore the Gulf of Mexico to a condition better than before the Deepwater Horizon exploded on April 20.

White House officials want to use the oil-spill disaster to implement long-developed plans to restore natural marshlands and waterways. Facing record budget deficits, that pledge could founder with BP balking.

Administration officials say the concessions extracted from BP are unprecedented. Negotiators were able to graft a deal onto the Oil Pollution Act of 1990, the main law dictating corporate responsibility in such a disaster, without having to ask Congress to change the law.

"A blank check was never in the cards," said an administration official at the talks. But, he added, the deal hammered out "went a very long way."

The Wednesday meeting at the White House was designed to go smoothly, the latest in a string of administration showdowns with corporate titans from General Motors to Wall Street banks. By the time BP Chairman Carl-Henric Svanberg and Chief Executive Tony Hayward walked up the White House driveway just past 10 a.m., the company had agreed in principle to the fund. "The president knew when he walked in that we were amenable to the kind of proposal we had already agree on in principle," a BP negotiator said.

Five days of preliminary talks between BP's hired lawyer, Jamie Gorelick, Associate Attorney General Thomas J. Perrelli, and White House counsel Robert Bauer had coalesced around the $20 billion figure.

But the talks—with about a half-dozen people on either side—stretched longer than expected. "A lot of the work was done before, but there were a lot of details," said White House Chief of Staff Rahm Emanuel in an interview. "Details matter."

Twice, the two sides retreated from talks in the West Wing's Roosevelt Room to consult privately: On BP's ability to appeal decisions made by the $20 billion fund's independent administrator, Kenneth Feinberg; and on how far BP would go to meet Mr. Obama's request that it also aid workers hurt by the drilling moratorium.

Both sides described the negotiations as businesslike. BP hired Ms. Gorelick, a former deputy attorney general in the Clinton administration, from the white-shoe law firm Wilmer Cutler Pickering Hale and Dorr LLP, in part because of her ties to Democratic lawyers including Mr. Bauer.

But there was one item barely discussed ahead of the meeting: assistance for workers hurt by the moratorium, which has forced 33 deepwater rigs to pull anchor. To drive home the request, the president had Mr. Bauer relay the request to Ms. Gorelick the day before, negotiators for both sides said.

At the meeting's start, Mr. Obama told the group of his concerns about those workers, most of whom did not work for BP.

When the president and vice president left the room, Ms. Gorelick told White House negotiators their legal position mandating BP's assistance to displaced workers was weak. White House officials conceded such workers may not be able to qualify for direct assistance under the $20 billion fund, a White House official in the room said.

A BP negotiator said the White House position was "half-hearted" and its negotiators quickly gave up. "You won't find many lawyers who will say when the government imposes a moratorium, it's the company's obligation to help the workers impacted," the BP adviser said.

The BP side was so confident that Ms. Gorelick suggested the two sides let idled workers submit claims to Mr. Feinberg and allow a court to decide whether the company was liable.

A White House official said the administration believed it had grounds to push BP, but in the end, Mr. Bauer made an emotional appeal.

He called BP's move cynical and asked why the company was "lawyering" after it told Congress and the administration it wouldn't duck its financial responsibility.

In response to that appeal, BP's negotiators agreed to voluntarily add $100 million as "a goodwill gesture," one adviser said. The two sides didn't agree how that money would be distributed.

BP used the word "fund" to describe the separate pot of money. The White House called it a foundation. As of Friday afternoon, they still had a long way to go to structure the fund, said a member of the team working on final details.

—Jeffrey Sparshott contributed to this article.
Write to Jonathan Weisman at jonathan.weisman@wsj.com

An oiled gannet gets cleaned at the Theodore Oiled Wildlife Rehabilitation Center

 

VIDEO RELEASE: An oiled gannet gets cleaned at the Theodore Oiled Wildlife Rehabilitation Center

 

Click on the image above to watch the video.

THEODORE, Ala. — Dr. Heidi Stout details the efforts at the Theodore Oiled Wildlife Rehabilitation Center as Rachael Newman and Michelle Bellizzi show how an oiled gannet is cleaned June 17, 2010. U.S. Coast Guard video by Petty Officer 3rd Class Colin White.

For information about the response effort, visit www.deepwaterhorizonresponse.com.

 

 

Summer in Paradise

From one of NOLA's best bloggers - Mark Folse - a description of our summers.....

"Not yet Midsummer’s Night and we have months ahead of red weather. We will drink more beer than modern American medicine thinks good for us (and outlive them to prove them asses), tending the fires in our grills beneath richly speckled Creole sausages, dousing the fatty flames with a spurt from a shaken bottle. We will drive out the evil vapors of last night’s cocktails by starting the weed whacker much too early for some of the neighbors, who may curse us but will then rise up themselves and get to the yard work before the sun boils the mercury in the window thermometer. Come the Fourth of July we will stand in the mosquito thick, coffee-hot dark breeze of the levee to cool ourselves and to better view the fireworks. August will weigh down upon us like the responsibility of empire on Caesar’ shoulders and we will still stand on the blistering cement of the French Market for Satchmo Fest if we are to late to claim a bit of shade."

A letter to Obama from Louisiana

From the Facebook Page Along the Bayou
MY LETTER TO THE PRESIDENT
Dear Barak Obama,

Many great American people gave their lives for you to be where you are. Just like they so strongly believed in equality, we believe in culture and heritage. You may think that this is way off, and totally not the same. Americans fighting for their equal rights, to be treated the same, can not be compared to people losing their culture. To us as Southern Louisianian's it is. Just like everyone else in America, we have certain things that we love in our hometown. New Yorkers love Times Square, people who live in San Fransico love the Golden Gate, it is their trademark, but more than that, it is personal to them. Tell me how these fishermen who have worked their whole lives off of these waters and made an honest living, will be the same. BP has taken their right to freedom of the land they have fished and hunted on. My community is like no other in America. We would be nothing without our marsh, bayous, and gulf. These things are literally a part of our everyday life. Apparently this is not important enough to you as the American President, and I understand when you or other people don't see what we see in this small place, and why it matters so much. It is here that generations of our families came home from war, wars that America asked them to fight for our freedom. Now, that freedom that they fought for, has been taken from us. It is a matter of my Civil Rights as an American, that you treat me equally. My son's freedom of choice has now been taken from him. He can not do what his father and 4 generations before him has done. He has no choice. He had a dream, a dream of becoming a full time Charter Fisherman. That is gone as of now and will be gone forever if something is not done immediately. Our love of these swamps and bayous are beyond explanation. How can you explain what you see as the President when you look at the American Flag or American Soldiers. Love, Pride, Beauty, Amazement, Glory, Passion, there is so much we see about our culture. We look at that oil spewing out of that pipe and its like watching a loved one die. This thing that other people see as just water, is what we need to live our lives. Lives that revolve around this water that is being taken away from us by the second. You have an obligation to protect us from any form of harm, well Mr. Obama, here it is. Someone has dropped a bomb right in the middle of our Times Square. When "topkill" failed it was like watching the second plane crash into the Towers all over again. As we watch BP try and fail it deminishes our hope. We feel just as if this is 911 all over again. You tell us this is war and we need to fight, we will be there. Yes, we would give our lives for our children to have this gift. We needed leadership and you failed us. You sent us into war with our hands tied and we have to listen to the enemy. I firmly believed that you have nothing to lose in this situation, but the respect of the American People. You have not come forward to take control of a situation that is fatal to many American people. TOXIC dispersants are still being used, even after the EPA told them to stop. You still have done nothing about this. You are the American President, you are the leader of the American People. You control these lands and anything in it. Need I remind you, Martin Luther King had a dream and died for it. You as the first black president had an obligation to be better, to bring respect back to the presidency. I think that dream has now ended in dissappointment the same way my son's has.

Sincerely,
A Heartbroken Dreamless American

Scuzzbucket of the Week

From the serene, well educated, culturally superior Pacific Northwest comes this op-ed written by a person named Froma Harrop.



The title has a nice, warm feeling about it: "Something must be done to help the people of Louisiana". But then the condescending claws come out. Here's an excerpt:

A modest proposal: The federal government should take over Louisiana. Might as well, at this point. (like THAT would help!)....Louisiana has had more than its share of tragedies in recent years, and some, such as Hurricane Katrina, could be deemed acts of nature. But whatever the cause, every calamity that befalls Louisiana is made worse by its corrupt civic culture.

Granted, there are some truths in the article, but the downright meanness is what got me.

Here's a link to the entire thing. Read it and see what you think.

Oh, and she "apologizes" for this article on her blog here. Too late for me.

Katrina Death Reincarnated

Marlin Miller, right, created the pelican for the Mississippi Coast Coliseum and Convention Center. Coliseum Executive Director Bill Holmes accepts the carving.

A 550-pound cedar pelican now marks the entrance to the new Pelican Cafe at the Mississippi Coast Convention Center in Biloxi.

The pelican was created by Fort Walton Beach, Fla., artist Marlin Miller, who has carved sculptures along Beach Boulevard from Biloxi to Waveland since Katrina.

The wood for the tree was taken from Long Beach, where Katrina felled it.

The 7-foot sculpture will get a nickname this summer at an open house, said Bill Holmes, the venue’s executive director.

— SUN HERALD

Read more: http://www.sunherald.com/2010/06/17/2269396/miller-brings-pelican-to-biloxi.html#ixzz0rEGQojhw

Bye, Tony

From Twitter: SKY NEWS- BP CHAIRMAN REMOVES CEO TONY HAYWARD FROM MANAGING GULF OIL SPILL, MANAGING DIRECTOR BOB DUDLEY TO TAKE OVER.

Besh: The BP Oil Spill: Destroying a Food Tradition

Chef John Besh (Louisiana native) discusses the relationship between the fishing and oil industries in Southeast Louisiana.


http://www.theatlantic.com/food/archive/2010/06/the-bp-oil-spill-destroying-a-food-tradition/57476/

BP in charge of EPA/USCG

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8th Generation Oyster Fisherman worries

One of the biggest complaints from coastal residents is that more is not being done to keep crude from hitting the coast and getting into the wetlands.

Now that BP has agreed to put $20 billion into an account to fund claims, many folks along the coast are asking when more will be done to protect the fisheries and keep more oil out of the marsh.

While people welcome the promise of money to help pay the bills, they worry about what is further down the road.

"They're filled with the uncertainty of they don't know where they are going to get their next dollar from," LSU Agcenter Fisheries Agent Rusty Gaude (pronounced "go-day") said. "It is as serious if not more serious than Hurricanes Katrina and Rita."

Mike Voisin's family has been making a living off the coastal waters since the 1800's.

"I'm an 8th generation oyesterman," he explained. "Am I the last generation of oyster fisherman? That's a very real threat."

Voisin fought back tears as he talked about it.

"It just hurts... there isn't an answer."

He is trying to remain confident that there will be a great future for the seafood of Louisiana, but he doesn't know how.

Listen to Voisin here.


Many asked after President Obama's Oval Office Address why he didn't talk about defending the coast.

Retired Army General Russel Honore has called for the military to take over the shoreline defense and treat it like an invading enemy.

Innovation Improves Tar Ball Removal Capability

MOBILE – The crew of one of the thousands of Vessels of Opportunity (VOO) working in response to the Deepwater Horizon oil spill recently recovered approximately two tons of tarball material in the Gulf of Mexico.

The recovery was the result of the kind of creative thought and innovation at work among the more than 27,000 people working around the clock in the Gulf of Mexico in the largest oil spill response in U.S. history.

Designed by Gerry Matherne, a BP contractor and nearshore task force leader, the idea is simple. A shrimp boat with outriggers on each side drags mesh oil-collection bags made of perforated webbing near the ocean surface. As the boat trawls to collect oil patches, the bags, attached to an aluminum frame, collect oil. When filled, the bags are disconnected from the frame by crew on support vessels, and then towed to a lift barge for hoisting into a collection barge.

For the collection of heavy, thick, dispersant-treated oil, this new mechanical recovery system is far more efficient than hand scooping and better suited than traditional (oleophilic) skimmer systems. Traditional skimmers are best used to collect less viscous oil that can be pumped from the skimmer into a collection tank.

"This is a great example of the heart and soul of the response…finding creative ways to get the oil offshore, which increases our effectiveness alongside traditional skimmers," said U.S. Coast Guard Incident Commander Capt. Steven Poulin.

The device was designed and built in a single week. The technology is now being duplicated for wider use in the response.

The Vessels of Opportunity (VOO) program was designed and implemented to provide local boat operators an opportunity to participate in response activities, including transporting supplies, assisting wildlife rescue and deploying containment and sorbent boom. More than 1,900 VOOs have been deployed to date in Alabama, Florida and Mississippi

BAYOU LA BATRE, Ala. - A line of shrimping boats acting as Vessels of Opportunity (VOOs) return to the port of Bayou La Batre after a shift change, Saturday, June 12, 2010. The VOO program was implemented to provide local boat operators an opportunity to assist with Deepwater Horizon oil spill response activities, including transporting supplies, assisting wildlife rescue and deploying containment and sorbent boom. Photo by Chief Petty Officer William McAnally.

GULF OF MEXICO – One of two one-ton masses of tarball material recovered south of Perdido Pass, Fla., by the crew of the lift boat Sailfish, a Vessel of Opportunity working in the largest oil spill response in U.S. history, on Saturday, June 11, 2010. Photo by Petty Officer 3rd Class John Walker, USCG.

For information about the response effort, visit http://www.deepwaterhorizonresponse.com/