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BP Reaches $7.8 Bn Settlement Over US Oil Spill

 
 
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 CHICAGO — Oil giant BP has reached a $7.8 billion (5.9 billion euro) deal to settle thousands of claims from the 2010 Gulf of Mexico oil spill, but some of the victims said Saturday that the money won't bring the disaster to a close.

The settlement announced late Friday does not affect what is anticipated to be tens of billions of dollars in fines and claims from the US government, coastal states and local governments impacted by the spill.

Nor does it resolve suits filed by shareholders or others seeking compensation because of a drilling moratorium imposed after the worst environmental disaster in US history.

But it does resolve a big piece of a very complicated legal battle.

"The proposed settlement represents significant progress toward resolving issues from the Deepwater Horizon accident and contributing further to economic and environmental restoration efforts along the Gulf Coast," Bob Dudley, BP's chief executive, said in a statement.

The last-minute deal means the highly anticipated trial will be delayed once again after a week-long postponement was ordered last Sunday to allow settlement talks to continue.

Judge Carl Barbier issued an order late Friday adjourning the case indefinitely "because such a settlement would likely result in a realignment of the parties in this litigation... and in order to allow the parties to reassess their respective positions."

The case will likely still go to court even if a deal is reached with the federal government.

That's because the British energy giant is hoping to shift some of the cost to its subcontractors, a complex legal question that will likely end up taking years and multiple appeals to resolve.

Several government probes have already criticized BP, rig operator Transocean and Halliburton -- which was responsible for the well's faulty cement job -- for cutting corners and missing crucial warning signs.

The April 20, 2010 explosion on the BP-leased Deepwater Horizon drilling rig killed 11 workers. The oil spill that followed blackened beaches in five US states and devastated the Gulf Coast's tourism and fishing industries.

It took 87 days to cap BP's runaway well 5,000 feet (1,500 meters) below the water surface as it spewed some 4.9 million barrels (206 million gallons) of oil into the Gulf of Mexico.

One set of federal fines could reach $18 billion if gross negligence is found.

BP is also on the hook for economic damages from the spill, including the cost of environmental rehabilitation, and could be hit with costly criminal charges and punitive damages ranging from one to five times the cost of economic damages.

Some victims of the Gulf oil spill say not even the multi-billion dollar settlement Friday will undo the problems they suffered.

"No amount of money will bring him back anyway," Sherri Revette, whose husband Dewey was a driller on the Deepwater Horizon oil rig, told AFP.

She wanted the case to proceed to trial rather than be resolved through settlement.

"I think everything needs to be brought out," she said. "We could quit pointing fingers. Each party that was guilty would know their part."

A judgment on the evidence would be more likely to make the oil firms "stop cutting corners," Revette said.

Fisherman and plaintiff Acy Cooper of Venice, Louisiana said the settlement marks good news for an industry that was devastated by the accident, as fishing waters were cut off and the reputation of the region's seafood suffered.

"It's good they settled," Cooper said. "I didn't want to wait no 10 years to get our money. This will be better for our industry."

David Fouche, a chef at Deanie's Seafood Restaurant in New Orleans, said he still is forced to import jumbo crabs from Venezuela after the spill devastated the local crab and oyster industries.

"Prices are just now getting to a level where they're affordable, where we can get into a profit range," Fouche told AFP.

His restaurant was paid a settlement from BP but Fouche said it did not cover all its additional expenses.

"BP's not going to pony up," he said.

The US Justice Department gave a hint the settlement is not the end of BP's legal entanglements or payments.

"Although we remain open to a fair and just settlement, we are fully prepared to try the case," it said in a statement, adding that it wants to ensure any resolution of damages claims "is just, fair and restores the Gulf for the benefit of the people of the Gulf states."

Agence France Presse / By Mira Oberman

Posted at March 3, 2012, 6:59am

 
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