BP Strongly Refutes 'Speculation' it will Settle Macondo Case for $25B
by Jon Mainwaring
Friday, January 20, 2012
BP has strongly refuted a Morgan Stanley report that suggested that it would pay a settlement of between $20 billion and $25 billion in connection with the 2010 Macondo oil spill in the Gulf of Mexico – which would significantly exceed the $12 billion that BP has set aside in provisions.
Civil litigation against BP, and other parties connected to the disaster, is due to begin at the end of February, with the trial focusing on claims for economic loss, injuries and environmental damage associated with Macondo.
But the Morgan Stanley research note, released on Thursday and written by the bank's head of European oil research Martijn Rats, said that the investment bank's base case "remains a settlement agreement". This settlement agreement, suggested the bank, would not only include BP's civil charges but also include criminal penalties and natural resource damage.
However, a spokesman for BP told Rigzone Friday: "There was no basis for what was an entirely speculative report by that analyst".
The spokesman added that the company was "not going to comment on any reports that we may or may not be in discussion with the Department of Justice."
BP's share price has been under pressure since the Morgan Stanley note was published and closed down three percent on Friday.
The Macondo oil spill saw oil flow continuously in the Gulf of Mexico for three months in 2010. It was the largest accidental marine oil spill in the history of the petroleum industry.
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