Oil Spill

BP to pay $18.7B to settle oil spill claims by US and Gulf states

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BP has agreed to pay five states and the federal government $18.7 billion to resolve environmental and economic claims stemming from the 2010 Gulf oil spill.

The settlement, announced on Thursday, settles claims by Florida, Alabama, Mississippi, Texas and Louisiana , report the Associated Press, Bloomberg News and the New York Times. The money will be paid over 18 years.

The settlement includes a record $5.5 billion in federal penalties under the Clean Water Act, 80 percent of which will go to state restoration efforts, as called for by a federal law that applies to the oil spill.

The settlement won’t be final until a consent decree is negotiated and a court approves the deal, according to a Justice Department release. If approved, the deal will be the largest environmental settlement in the history of the United States, and the largest civil settlement with a single entity ever, the Justice Department says.

The agreement resolves the largest remaining liabilities from the oil spill, according to BP Chief executive officer Bob Dudley. The oil company agreed in 2012 to settle oil spill claims by businesses and individuals in a deal originally valued at $7.8 billion. A federal appeals court upheld the settlement last year over BP’s objections that a claims administrator’s interpretation was resulting in payments to businesses that suffered no injuries.

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