BP Plc and the lead lawyers representing victims of the 2010 Gulf of Mexico oil spill won approval of the economic and environmental loss portion of a proposed $7.8 billion partial settlement of claims.
The agreement resolves most private plaintiffs’ claims for economic loss and property damage related to the explosion of the Deepwater Horizon oil rig and subsequent spill. It doesn’t cover suits brought by the US government and the states of Alabama and Louisiana over the largest offshore oil spill in US history.
US District Judge Carl Barbier in New Orleans, who is overseeing litigation over the spill, granted final approval to the settlement yesterday after he considered objections to the accord. Barbier gave preliminary approval in May.
The settlement “provides compensation to class members that appears sufficient” to cover their losses from the spill, Barbier said in his 125-page ruling approving the agreement.
The blowout and explosion aboard the Deepwater Horizon drilling rig in April 2010 killed 11 workers and sent millions of barrels of crude leaking into the gulf. The accident prompted hundreds of lawsuits against BP; Transocean Ltd, the Vernier, Switzerland-based owner and operator of the rig; and Halliburton Co, which provided cementing services.
BP officials hailed Barbier’s approval of the settlement as a step forward in the company’s efforts to move beyond the spill.
“We believe the settlement, which avoids years of lengthy litigation, is good for the people, businesses and communities of the Gulf and is in the best interests of BP’s stakeholders,” Scott Dean, a company spokesman, said in an emailed statement.
Barbier was also considering the portion of the settlement designed to cover claimants’ physical injuries related to the spill or the cleanup. The accord sets aside money to provide medical monitoring of claimants’ health in the future, according to court filings.
The proposed partial settlement of private claims was reached March 2, days before a trial on liability for the spill was set to begin. While BP estimates the accord to be worth at least $7.8 billion, it doesn’t have a cap on potential settlement claims.
“We are extremely pleased with the court’s ruling,” Steve Herman and Jim Roy, the co-lead counsel for the plaintiffs, said in a statement. “This settlement has — and will continue to — bring the people and businesses of the Gulf the relief they deserve.”
The accord excludes claims of financial institutions, casinos, private plaintiffs in parts of Florida and Texas, and residents and businesses claiming harm from the Obama administration’s moratorium on deep-water drilling prompted by the spill.
It also doesn’t cover federal government claims and those of Gulf Coast states Louisiana and Alabama, or lawsuits against co-defendants.
BP has been in negotiations with the US Justice Department to settle the federal claims, the company said in an October 30 regulatory filing. BP has provisioned about $38.1 billion for spill costs and has paid more than $8 billion in compensation to individuals, businesses and government entities so far.