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Wednesday, June 26, 2019

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Gulf states reach $18.7B settlement with BP over oil spill

Gulf states reach $18.7B settlement with BP over oil spill

NEW ORLEANS (AP) — BP and five Gulf states announced an $18.7 billion settlement Thursday that resolves years of legal fighting over the environmental and economic damage done by the energy giant's oil spill in 2010.

The settlement money will be used to resolve the Clean Water Act penalties; resolve natural resources damage claims; settle economic claims; and resolve economic damage claims of local governments, according to an outline filed in federal court. The settlement involves Florida, Alabama, Mississippi, Louisiana and Texas.

"If approved by the court, this settlement would be the largest settlement with a single entity in American history; it would help repair the damage done to the Gulf economy, fisheries, wetlands and wildlife; and it would bring lasting benefits to the Gulf region for generations to come," U.S. Attorney General Loretta Lynch said in a statement.

The settlement announcement comes as a federal judge was preparing to rule on how much BP owed in federal Clean Water Act penalties. The judge had already found that 3.19 million barrels of oil — nearly 134 million gallons — spewed into the Gulf. Individual states also were pursuing litigation.

“Five years ago, the BP explosion and spill took the lives of 11 men and devastated our coast, our communities, and our economy,” said U.S. Senator David Vitter (R-La.) in a statement. “Properly holding BP accountable and making sure that these monies go toward restoring our coast have been top priorities, and moving forward I'll make sure we put shovels in the ground soon using this money wisely according to the detailed plan I've laid out.”

Louisiana Attorney General Buddy Caldwell has reported that Louisiana will receive more than $6.8 billion in new support, resulting in almost $10 billion total.

The state will receive this funding over 16 years, through the Natural Resources Damage Assessment (NRDA) and accruing interest through the RESTORE Act. New funding will go toward:
- $5 billion for natural resource damages
- $1 billion for state economic damages
- $787 million in Clean Water Act penalties through RESTORE
- Coverage for all states assessment costs and total reimbursement fees

BP PLC chairman Carl-Henric Svanberg said the settlement reflected the company's commitment to restoring the Gulf of Mexico economically and environmentally, and provided the company with closure going forward.

The company had argued against a high Clean Water Act penalty, saying its spill-related costs already were expected to exceed $42 billion. It's also unclear how much BP will end up paying under a 2012 settlement with individuals and businesses claiming spill-related losses.

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