US plans gulf spill settlement with BP: report


Mon, Feb 25, 2013 - Page 15

US authorities plan to propose a US$16 billion settlement to British energy giant BP for civil claims related to the 2010 oil spill in the Gulf of Mexico, the Wall Street Journal said.

Citing people familiar with the discussions, the newspaper said late on Friday that the settlement would cover fines BP owes under the Clean Water Act, a federal water pollution law, as well as payments under the Natural Resources Damage Assessment, an environmental evaluation.

However, the Journal said that it remained unclear whether the government had formally proposed the offer to BP.

The April 20, 2010, explosion on the Deepwater Horizon oil rig, operated by BP off New Orleans, killed 11 people and spilled hundreds of millions of liters of crude oil into the Gulf of Mexico. It took four months to cap the well.

BP said on Tuesday it would “vigorously defend” itself in court against what it termed “excessive” fines for the incident.

The company already pleaded guilty in November last year, to criminal charges and agreed to pay a record US$4.5 billion in criminal fines.

It reached a US$7.8 billion settlement early last year to cover the bulk of the outstanding private claims for economic loss, property damage and medical problems.

BP has paid out US$10 billion to businesses, individuals and local governments impacted by the spill and spent more than US$14 billion on the response and cleanup.

The oil firm also remains on the hook for billions in additional damages, including the cost of environmental rehabilitation.