2nd UPDATE: Senate Panel Votes To Remove Cap On Spill Claims

30th Jun 2010 22:03

By Siobhan Hughes and Tennille Tracy Of DOW JONES NEWSWIRES WASHINGTON (Dow Jones)--A U.S. Senate panel on Wednesday voted to remove a cap on damage claims paid by BP PLC (BP, BP.LN) for a Gulf of Mexico oil spill, as a Democratic lawmaker called for going further to punish BP for a continued gush of oil from a broken well. By voice vote, the Senate Environment and Public Works Committee agreed to eliminate the cap on damage claims for offshore drilling. Though Republicans--and some Democrats--are concerned about eliminating the cap entirely, the current limit of $75 million is widely regarded as too low. Already, BP has paid out $130 million in claims, according to the latest data available from the response team. In the U.S. House of Representatives, Rep. George Miller (D., Calif.) said he plans to introduce legislation to block BP from obtaining new offshore-drilling leases for up to seven years. "What I'm concerned about is the ethics of this company and how they have performed in the past," Miller said at a hearing in the House Natural Resources Committee. "At some point, the American people are entitled to a standard." With Congress off next week for an Independence Day recess, the measures to raise the liability cap and to ban BP from obtaining new offshore-drilling leases aren't about to become law immediately. But the legislative efforts show how congressional anger over the oil spill hasn't let up more than two months after the explosion of the Deepwater Horizon drilling rig and the blowout of the undersea well that workers were developing. Democrats will press their case again on Thursday, when the House Transportation and Infrastructure Committee votes on a related bill to eliminate the cap on damage claims for offshore operations. The Senate aims to wrap the liability-cap measure into a broader energy package that "we hope to consider this summer," said a spokeswoman for Senate Majority Leader Harry Reid (D., Nev.). Republicans are warning against rushing to legislate amid the spill, which began after the April 20 explosion of the rig. Sen. Lamar Alexander (R., Tenn.) cautioned that removing the limit on claims for damages would shut all but the largest oil companies out of offshore drilling by making it impossible to obtain insurance. He also complained about applying the new policy retroactively. "The United States has proudly been the best place to create jobs and one reason is that we follow the rule of law and don't change the rules retroactively," Alexander said at the Senate Environment and Public Works vote. "We're not a banana republic--we don't treat you differently under the law because you become unpopular." -By Siobhan Hughes, Dow Jones Newswires; 202-862-6654; [email protected] -By Tennille Tracy, Dow Jones Newswires; 202-862-6619; [email protected] (END) Dow Jones Newswires June 30, 2010 17:03 ET (21:03 GMT)