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BP, Plaintiffs Reach Settlement Agreements for Deepwater Horizon Incident

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Deepwater Horizon Gulf of Mexico Oil Spill

BP, Plaintiffs Reach Settlement Agreements for Deepwater Horizon Incident

LONDON - BP PLC said Wednesday it has reached a definitive settlement agreement with lawyers representing thousands of individuals and businesses hurt by the Gulf of Mexico oil spill, solidifying the proposed accord agreed between the two parties early last month.

The deal, worth approximately $7.8 billion, is in line with the sum initially mooted March 2 and will be paid from a $20 billion trust initially set up by BP in the aftermath of the spill. BP set aside a total $37.2 billion to cover the costs of the disaster.

A New Orleans, La., judge will now have to decide whether to approve the settlement, which is split into two classes: economic loss claims and medical claims.

Those under the economic loss category include businesses, property owners and individuals along the Gulf of Mexico who sustained economic damage from the 87-day oil spill, the biggest offshore spill in U.S. history. The medical claims class include a range of individuals who may have health problems due to the spill, including the tens of thousands of spill clean-up workers. Those individuals may be eligible for medical consultation services for the next 21 years.

"BP made a commitment to help economic and environmental restoration efforts in the Gulf Coast, and this settlement provides the framework for us to continue delivering on that promise, offering those affected full and fair compensation, without waiting for the outcome of a lengthy trial process," said BP Chief Executive Bob Dudley in a statement.

However, BP still faces the prospect of a lengthy court battle if it fails to reach similar settlements with other parties, including the U.S. government and contractors on the ill-fated Deepwater Horizon rig--Halliburton Corp. (HAL) and Transocean Ltd. (RIG), as well as blowout preventer-manufacturer Cameron International Corp. (CAM).

BP has filed cross-claims with those companies, saying they are partially culpable for the accident. All those companies have denied this.

Wednesday's final and definitive settlement doesn't resolve claims that the plaintiffs may make against Transocean, Halliburton or Cameron.

It also doesn't cover claims against BP by the U.S. Department of Justice or other federal agencies for violations of the Clean Water Act, or by the states and local governments.

BP shares ended Thursday down 7 pence, or 1.4%, at 446p, implying a market capitalization of $84.8 billion. By way of comparison, the FTSE 350 oil and gas index closed down 0.5%.

Copyright (c) 2012 Dow Jones & Company, Inc.

WHAT DO YOU THINK?

Post a Comment Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
Jack Nelson | Apr. 20, 2012
I have more that 40 years in the industry, many of the as the manager of the rig contracted to the oil company. I have been at these morning meetings tp discuss what is the plan for the next 24 hours. 1: In the Macondo case BP was behind schedule, over budget, and their college educated people did not realize what a very good well they had. 2: Yes, Halliburton did tests on the well, made recommenations about what to run to keep the pipe in the center of the well, which were not followed by BP as they wanted to keep the cost down.because it would take more time. Transocean supervisors went along with this, and did not contact their shore base. 3: At the last meeting with all concerrned the BP Supervisor overrid the concerns of Halliburton, the Transocean Supervisor agreed, and did not call his shore based supervisor with any concerns or dis agreements, and the operations went ahead. 4: Well, as a 45 year offshore drilling person, more than 30 years of that as Rig Manager in different parts of the world, you just do not do this. If you pay attention, not in a college classroom, you learn that Mother Natrue has her rules (do not try to create a vacumn), and in life that "Hell hath no fury like a woman scorned" Put those together like BP did during their operations to try to end the well to try and save money, " another hole in Mamas butt" ,without taking the proper steps, then this is what you end up with. I give my condolences to the families that have lost loved ones. I have no respect or feelings for BP or those Supervisors of Transocean that did not try to stop this from happening.

jack nelson | Apr. 20, 2012
The monetary settlement will not cover the loss of lives due to the basic "we are behind schedule, and over budget mentality of corporatiions, and some of their personnel. As a person who worked for drillng contractors for many years, a lot as the the Rig Manager, who attened some of these morning meetings to discuss would happen during the next 24 hours, and the Transocean supervisor agreed, I was appalled enough to telephone BP and give them my feelings. I should have also telephoned TransOcean to tell them my feelings about their Sr. Supervisor on board who did not go and call his superisor in town and say "this is not right". I did not as I just do not have much confidence in TrasOcean.

Scott | Apr. 19, 2012
Thats a company that takes its responsibility and accountability for its part in Macondo seriously. More than can be said for a few others who were also culpable.


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