BP to pay the biggest penalty to settle world’s largest oil spill
YEREVAN, October 6, /ARKA/ The US government and BP have finalized a $20.8 billion deal to settle the energy giant’s 2010 Deepwater Horizon oil spill. BP plans to stretch its payment, described as the “biggest in US history,” over 15 years, according to news reports.
The final agreement comes more than three months after the deal was first announced in July, but still needs to be approved by a federal court.
At the time, BP estimated the damage caused by the Deepwater Horizon disaster at $18.7 billion, while Justice Department officials put the price tag at $20 billion.
Under the deal announced on Monday’s, the difference includes the money that BP has already spent on spill restoration and compensation payments that are still being calculated.
The Department of Justice said in a statement that this is “the largest settlement with a single entity in the department’s history.”
The $20.8 billion settlement includes $7.1 billion for natural resource damages, $5.5 billion for Clean Water Act fines, and $4.9 billion in payments to five US states: Louisiana, Mississippi, Alabama, Florida and Texas. Several hundred local governmental bodies will receive up to $1 billion to settle claims for economic damages.
BP plans to pay off its penalty by making payments over the next 15 years. The oil giant had previously estimated that it would pay out more than $1 billion annually over most of this period.
More than 3 million barrels of oil seeped into the Gulf of Mexico over a period of nearly three months during the ecological catastrophe, making the spill the largest accident of its kind in petroleum industry history. Around 16,000 miles of coastline were affected and, according to the National Park Service, more than 8,000 animals died as a result. -0-
The final agreement comes more than three months after the deal was first announced in July, but still needs to be approved by a federal court.
At the time, BP estimated the damage caused by the Deepwater Horizon disaster at $18.7 billion, while Justice Department officials put the price tag at $20 billion.
Under the deal announced on Monday’s, the difference includes the money that BP has already spent on spill restoration and compensation payments that are still being calculated.
The Department of Justice said in a statement that this is “the largest settlement with a single entity in the department’s history.”
The $20.8 billion settlement includes $7.1 billion for natural resource damages, $5.5 billion for Clean Water Act fines, and $4.9 billion in payments to five US states: Louisiana, Mississippi, Alabama, Florida and Texas. Several hundred local governmental bodies will receive up to $1 billion to settle claims for economic damages.
BP plans to pay off its penalty by making payments over the next 15 years. The oil giant had previously estimated that it would pay out more than $1 billion annually over most of this period.
More than 3 million barrels of oil seeped into the Gulf of Mexico over a period of nearly three months during the ecological catastrophe, making the spill the largest accident of its kind in petroleum industry history. Around 16,000 miles of coastline were affected and, according to the National Park Service, more than 8,000 animals died as a result. -0-