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BP woes remain after $7.8bn settlement
UK-based global oil and gas company BP has struck a $7.8 billion deal with the 110,000 businesses and individuals affected by the Deepwater Horizon disaster, but the issue of penalties and damages sought by the US government still looms.
Settlement: $7.8 billion and counting
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According to a report in The Daily Telegraph, BP understands that the recent deal will not pave the way for a settlement with the US Department of Justice.
Reasonable terms
Brian Gilvary, BP’s chief financial officer, told the paper that his company is ‘prepared to settle with others on terms that are reasonable, but equally prepared to go to court’.
Friday’s settlement with the plaintiffs’ steering committee -- which represents property owners, fishermen and hoteliers among others -- will be paid out of BP’s $20bn trust fund, created specifically to pay compensation for damage from the incident. However, BP anticipates overall costs of $37.2bn as a result of the disaster.
BP general counsel Rupert Bondy told the Telegraph that there was ‘nothing specific’ in the agreement that would affect a potential case on who was to blame for the disaster.
Criminal charges
The Financial Times reports that the Justice Department is looking into the possibility of bringing criminal charges against the companies and their employees involved in the 2010 explosion and resulting spill -- which killed 11 workers and leaked 4.9 million barrels of oil -- although nothing has materialised so far.
Most pressing for BP is a potential $17.5bn penalty that could be applied under the Clean Water Act if the company is judged to have been grossly negligent.
The FT suggests the US government will take a hard line over the incident and expect the maximum possible payout.
Reasonable terms
Brian Gilvary, BP’s chief financial officer, told the paper that his company is ‘prepared to settle with others on terms that are reasonable, but equally prepared to go to court’.
Friday’s settlement with the plaintiffs’ steering committee -- which represents property owners, fishermen and hoteliers among others -- will be paid out of BP’s $20bn trust fund, created specifically to pay compensation for damage from the incident. However, BP anticipates overall costs of $37.2bn as a result of the disaster.
BP general counsel Rupert Bondy told the Telegraph that there was ‘nothing specific’ in the agreement that would affect a potential case on who was to blame for the disaster.
Criminal charges
The Financial Times reports that the Justice Department is looking into the possibility of bringing criminal charges against the companies and their employees involved in the 2010 explosion and resulting spill -- which killed 11 workers and leaked 4.9 million barrels of oil -- although nothing has materialised so far.
Most pressing for BP is a potential $17.5bn penalty that could be applied under the Clean Water Act if the company is judged to have been grossly negligent.
The FT suggests the US government will take a hard line over the incident and expect the maximum possible payout.
