BP agrees to $18.7 billion settlement over 2010 oil spill

BP agrees to $18.7 billion settlement over 2010 oil spill

[JURIST] BP [official website] on Thursday reached a settlement that will require the company to pay $18.7 billion in penalties and damages to settle all claims regarding the 2010 Gulf oil spill [JURIST news archive]. The agreement, the largest corporate settlement in US history, will add to the $43.8 billion that BP had budgeted for penalties and cleanup costs, bringing the total cost [Reuters fact sheet] of the spill for BP to $53.8 billion. The settlement with the US Department of Justice [official website] and the affected Gulf states specifically requires the company to pay at least $12.8 billion in penalties stipulated under the Clean Water Act [text] and natural resource damages. The other $4.9 billion will go to the affected states. Attorney General Loretta E. Lynch [official profile] in a statement [press release] said, “Since the Deepwater Horizon oil spill – the largest environmental disaster in our nation’s history – the Justice Department has been fully committed to holding BP accountable… the Deepwater trial team has fought aggressively in federal court for an outcome that would achieve this mission, proving along the way that BP’s gross negligence resulted in the Deepwater disaster.”

The April 2010 Deepwater Horizon oil spill, or BP oil spill, has had far-reaching and catastrophic environmental and economic effects [JURIST backgrounder]. In March the US government appealed a federal court ruling [JURIST report] that reduced the potential liability BP faces under the Clean Water Act in relation to the 2010 spill. In February District Court Judge Carl Barbier of the US District Court for the Eastern District of Louisiana rejected a motion [JURIST report] by BP to reduce the civil fine payable under the Clean Water Act. BP’s appeal sought to reduce the fine per barrel from the $4,300 proposed by the US government to $3,000 per barrel. In December the US Supreme Court declined [JURIST report] to review a settlement with BP resulting from the 2010 Deepwater Horizon disaster. In August a federal district court in Louisiana ruled [JURIST report] that BP was grossly negligent and bears a majority of the blame for the 2010 Deepwater Horizon disaster.