Obama wants to beef up law on oil spill damage cap

WASHINGTON Mon May 10, 2010 7:34pm EDT

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WASHINGTON (Reuters) - President Barack Obama wants his administration to send legislation to Congress to toughen U.S. law on caps for damages from oil spills, the White House said on Monday.

Obama also will send his secretary of energy, Steven Chu, other administration officials and government scientists to Houston this week "for an extensive dialogue" with officials from BP Plc on potential solutions, as he grapples with concerns about environmental and economic disaster from the huge slick in the Gulf of Mexico.

But the administration repeated its assertion that BP will be on the hook for what could be billions of dollars in cleanup costs.

"As the President has made clear before, BP will be paying for all costs of stopping the spill and cleaning it up, and we will aggressively pursue full compensation for damages," White House spokesman Robert Gibbs said in a statement.

On May 5, U.S. lawmakers in the House of Representatives introduced legislation similar to an effort in the Senate that would force BP to pay hefty damages for the spill.

The House bill, like legislation introduced in the Senate, would raise the maximum amount of money BP could be required to dole out for economic losses caused by the spill to $10 billion from $75 million.

Obama held a meeting at the White House on Monday with Cabinet secretaries and other administration officials to talk about the slick.

As they evaluate different options to try to stop the flow of oil, Obama pushed for the use of independent experts and bringing every perspective to the table.

Since the Deepwater Horizon rig exploded and sank last month, claiming 11 lives, hundreds of thousands of gallons (liters) of crude oil a day have been gushing into the Gulf, with no solution in sight.

Obama visited the region on May 2 and his administration has been working to reassure the public that it is doing everything it can to assist in efforts to stop the flow and that BP, not the U.S. government, will fund the cleanup.

"In addition, to deal more generally with the harms created by oil spills, the president has requested that we send legislation to Congress to toughen and update the law surrounding caps on damages," Gibbs said.

(Reporting by Patricia Zengerle, Editing by Eric Walsh)

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