Final approval for BP settlement

A New Orleans federal judge granted final approval late on Monday to an arrangement that will see the US upstream unit of BP settle all federal and state claims arising from the 2010 Deepwater Horizon oil spill in the Gulf of Mexico.

Estimated to be in the range of USD 21 billion, the deal constitutes the largest-ever environmental settlement in the US. Clean Water Act penalties alone account for USD 5.5 billion, which will be paid out over a period of 15 years.

The July 2015 proposal further included more than USD 8 billion in natural resource damages payments to the US and Alabama, Florida, Louisiana, Mississippi and Texas. The coastal states will also be paid USD 4.9 billion over an 18-year period in settlements for economic and other claims. USD 1 billion has been earmarked for payout to local governments. The cumulative pre-tax charge associated with the accident is now in excess of USD 53 billion.

“We are pleased that the Court has entered the Consent Decree, finalising the historic settlement announced last July,” a BP spokesperson said.  An earlier March court ruling safeguarded BP from future lawsuits by oil and gas companies and services entities seeking damages over losses incurred due the ban on drilling in the Gulf of Mexico in the wake of the spill.