Deepwater Horizon Oil Spill Trust

The Deepwater Horizon Oil Spill Trust is the $20 billion trust fund established by BP to settle claims arising from the Deepwater Horizon oil spill. The fund was established to be used for natural resource damages, state and local response costs and individual compensation. It was established as Gulf Coast Claims Facility (GCCF), announced on 16 June 2010 after meeting of BP executives with U.S. President Barack Obama. In June 2012, the settlement of claims through the GCCF was replaced by the court supervised settlement program.

After the Deepwater Horizon oil spill started, BP promised to compensate all those affected. Then CEO Tony Hayward stated, "We are taking full responsibility for the spill and we will clean it up and where people can present legitimate claims for damages we will honor them. We are going to be very, very aggressive in all of that." Prior to establishing the GCCF, emergency compensation was paid by BP from an initial facility.

On 16 June, after meeting with President Obama, BP executives agreed to create a $20 billion spill response fund. BP said it would pay $3 billion in third quarter of 2010 and $2 billion in fourth quarter into the fund followed by a payment of $1.25 billion per quarter until it reaches $20 billion. In the interim, BP posted its US assets worth $20 billion as bond. The amount of the fund was not a cap on BP's liabilities. For the fund's payments, BP said it would cut its capital spending budget, sell $10 billion in assets, and drop its dividend. After provisions of the Deepwater Horizon Oil Spill Trust were released 11 August 2010, it was revealed that the BP Spill Fund may be backed by future drilling revenue, using BP's production as collateral. BP pledged as collateral all royalties from the Thunder Horse, Atlantis, Mad Dog, Great White, Mars, Ursa, and Na Kika fields in the Gulf of Mexico.

One aim of the fund was said to be minimizing lawsuits against the company. According to BP officials, the fund could be used for natural resource damages, state and local response costs and individual compensation but could not be used for fines or penalties.

...
Wikipedia