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BP agrees to 20-billion-dollar fund for spill victims

Embattled oil giant BP has agreed to pay 20 billion dollars (25 billion euros) into a fund to meet mounting claims from victims of the oil spill in the Gulf of Mexico.

Reuters
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Ahead of congressional hearings on Thursday, BP says it is freezing payouts for shareholders to help create a fund for victims of the oil spill in the Gulf of Mexico.

BP chairman Carl-Henric Svanberg said payouts for shareholders will be frozen this year to help pay for the fund after meeting US President Barack Obama in Washington on Wednesday.

Top US lawmakers had demanded the company cover all costs of the spill before rewarding shareholders with a dividend that usually amounts to around 2.5 billion dollars (three billion euros) per quarter.

Svanberg insisted BP did care about the fate of the "small people" hit by the spill and vowed to look after all those affected.

BP chief executive Tony Hayward is expected to face a grilling in the US Congress on Thursday over his handling of the crisis. According to a prepared testimony, Hayward is expected to blame an unprecedented series of failures for the spill.

The massive slick caused by a ruptured well in April is now threatening the coastline of four southern states, and has crippled the fishing and tourist industries in the region.
 

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