Actually, Fox, there's at least $1.35 trillion "to BP's name right now"

Blog ››› ››› TOM ALLISON

Fox News would like you to believe that poor little British Petroleum doesn't have the wherewithal to satisfy the demands of the bullying Obama administration. Tonight on Hannity, Fox Business' Sandra Smith criticized BP's voluntary agreement to provide $20 billion to an independently administered escrow account in order to settle claims from those affected by the Gulf oil spill, claiming, "There's not $20 billion to BP's name right now." Smith argued: "The latest quarterly report from the company showed it had about $7 billion on the balance sheet. That's about $13 billion short, of what we're talking about, just throwing this money to the victims here."

She added: "The only thing they could do is sell stocks, bonds, but there's no money for the bonds right now."

The thing is, BP reportedly has at least $1.35 trillion worth of proven oil reserves. From a June 15 article headlined "BP faces huge tab, has deep pockets":

BP also holds $6.8 billion in cash and short-term investments, which it could tap to pay for Gulf spill expenses. But that number is dwarfed by the rest of the company's financial resources.

Even if all of BP's future profits went to pay for the Gulf spill, the company still owns vast resources of oil reserves that could be converted into cash by selling them to another oil company.

According to estimates from bond rating agency Moody's, BP has total proven reserves of roughly 18 billion barrels of oil in the ground, worth some $1.35 trillion at the current price of $75 a barrel. It also has a string of new fields due to move into production over the next few years, including other wells in the Gulf, along with finds in Azerbaijan, Angola, Egypt and Indonesia.

So Fox has now defended the oil giant by criticizing Obama for "demonizing BP," slammed the administration's moratorium on new offshore drilling despite a lack of spill response plans, and even called the escrow account proposal "Chavez-like." Now they want you to think that Obama's push for BP to pay to clean up their mess will put them in the poor house.

Posted In
Environment & Science, Drilling, Energy
Fox News Channel
Sandra Smith
We've changed our commenting system to Disqus.
Instructions for signing up and claiming your comment history are located here.
Updated rules for commenting are here.