By Tom Bergin and Matt Spetalnick
LONDON/WASHINGTON (Reuters) - Prime Minister David Cameron defended BP <:BP.LO:>on Tuesday before meeting President Barack Obama and U.S. senators as the British energy giant looked to sell assets to pay for the worst oil spill in U.S. history.
Exactly three months after an explosion on an offshore rig killed 11 workers and caused millions of barrels of crude to spill into the Gulf of Mexico, BP announced it would sell its Vietnam pipeline and upstream assets as well as its Pakistan assets.
Proceeds from the assets, worth about $1.7 billion (1.1 billion pounds), will help to pay for the oil spill, its cleanup and legal costs.
The energy giant, which said on Monday it had spent about $3.95 billion so far on the spill and cleanup, has said it plans to raise $10 billion in the coming year to pay for damage claims and the cleanup related to the leaking well.
BP agreed under intense pressure from U.S. authorities last month to set up an independently administered $20 billion escrow fund for damage claims from the spill. The Obama administration has stressed this is not a cap on the company's liabilities.
The broken well was capped last week -- at least temporarily -- after spilling up to 60,000 barrels a day of crude for three months.
Shares were flat in London and New York trade after the latest asset sale announcements.
Analysts said investors, who reacted positively after the top U.S. oil spill official said on Monday that seepage about three kilometres (1.9 miles) from the well was not caused by a pressure test, were still wary.
"So much is unknown, the problem with the stock is investors are making bets with very little information," said Mark Coffelt, chief investment officer, Texas Capital Value Funds in Austin, Texas. "It's a difficult stock to hold, because it's so hated right now, which probably means it's a good buy."
The test on the well, which has been extended in 24-hour increments by the U.S. government, will continue until Tuesday afternoon and then be re-evaluated for a possible further extension. Scientists are now weighing another option -- a so-called "static kill" to help smother and plug the leak.
This would involve pumping heavy drilling mud and possibly cement into the well, much like BP's failed "top kill" in May.
The American public and U.S. lawmakers are angry with BP for the oil spill, which has caused an economic and environmental disaster in five states along the Gulf Coast, hurt Obama's approval ratings and complicated traditionally close ties with Britain.
LOCKERBIE
Though not connected with the spill, the energy giant is also facing questions over whether it had a role in the release last year of Libyan Abdel Basset al-Megrahi, sentenced to life for bombing a Pan Am flight in 1988 over Lockerbie, Scotland.
BP has confirmed it lobbied the British government in 2007 over a prisoner transfer deal for fear its commercial interests in Libya were being damaged, but said it was not involved in talks over al-Megrahi.
British Prime Minister David Cameron, in Washington to meet lawmakers and President Barack Obama, told National Public Radio: "Of course BP has got to do everything necessary to cap the oil well, to clean up the spill, to pay compensation. I've met with BP. I know they want to do that, and they will do that."
"But ... let's be clear about who released al-Megrahi; it was a government decision in the UK. It was the wrong decision. It wasn't the decision of BP. It was the decision of Scottish ministers," he added.
(Additional reporting by Doina Chiacu and Tabassum Zakaria in Washington, Matthew Lynley in New York, Writing by Deborah Charles and Sitaraman Shankar; Editing by Eric Beech)