Thursday, October 8, 2015

The Cost of Oil: BP Reaches $20 Billion Settlement with the Federal Government

In the largest single entity settlement in the Department of Justice's history, BP will have to pay $20.8 for its role in the infamous Gulf of Mexico oil spill in April, 2010. Since the disastrous explosion of the Deepwater Horizon drilling platform BP has been engaged in protracted negotiations with the federal government. Now the Department of Justice have finalized the settlement with BP. The settlement comes after years of legal wrangling. In July, the Supreme Court denied the company’s appeal to block benefits for those not directly affected by the spill.

As reported by The Hill, the fine breaks down as follows
  • $5.5 billion to settle civil claims under the Clean Water Act
  • $7.1 billion for environmental restoration work
  • $700 million to compensate for still-unknown damages to natural resources in the region
  • $4.9 million to Gulf Coast states affected by the spill
  • $1 billion to local communities. Florida, Alabama, Mississippi, Louisiana and Texas will split that portion of the settlement.
  • BP has also already spent more than $1 billion on environmental restoration work in the area
Almost $9 billion of the settlement money will be used by for a Gulf restoration fund. This money will be invested in coastal and habitat repair, water quality improvement in wetlands and recreational projects in the region.

Biologists have observed that the 3.19 million gallons of oil that pored into the Gulf is having long term effects that continue to this day.

"This is still the largest environmental penalty under the Clean Water Act and Oil Pollution Act, ever," Attorney General Loretta Lynch said. "BP is receiving the punishment it deserves while also providing critical compensation to the damage to the Gulf region."

The punishment will serve as a deterrent that will hopefully prevent similar disasters in the future.

"The steep penalty should inspire BP and its peers to take every measure necessary to ensure that nothing like this can ever happen again," Lynch said.

The $20.8 billion fine is separate from the class-action settlement with businesses and individuals affected by the spill.

Environmental Protection Agency Administrator Gina McCarthy noted that the settlement includes $700 million to address any potential environmental damages that officials have yet to discover.

"Justice is not about dumping a pile of money and walking away," McCarthy said. "It is about investing in sustainable ways that empower and strengthen the Gulf communities over the long term."

The settlement still needs to be approved by a federal court.

Related
BP's Legal Wrangling Five Years After the Gulf Oil Spill
The Toll on Wildlife from the Gulf of Mexico BP Oil Spill
BP's Gulf Oil Spill: Summary of Research Evidence Five Years Later
The BP Oil Spill in the Gulf Five Years Later
Supreme Court Gives BP a Lump of Coal for Christmas
Transocean to Pay $1.4 billion for its Role in the Gulf Oil Spill
The Costs of Oil: BP Liable for up to 90 Billion
Judge Declares BP is Grossly Negligent but are Fines Enough?
Infographic - BP Oil Spill 4 Years Later
Video - The Ongoing Impacts of the BP Oil Spill in the Gulf of Mexico
The Cost of Oil: BP Barred from Doing Business with the US
The Costs of Oil: BP Liable for Tens of Billions
BP's Corporate Irresponsibility
Responsibility for the Costs of the Gulf Oil Spill
The Costs of Offshore Drilling
Managing the Massive Gulf Oil Spill
Offshore Oil is an Avoidable Tragedy
Two More Reasons to Move Beyond Fossil Fuels

No comments: