US Gulf states reach $18.7B settlement with BP

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 Thursday morning.

In arguing against such a high penalty, BP has said its spill-related costs already were expected to exceed $42 billion – even without the Clean Water Act fine. It's also unclear how much BP will end up paying under a 2012 settlement with individuals and businesses claiming spill-related losses.

Costs incurred by BP so far include an estimated $14 billion for response and cleanup and $4.5 billion in penalties announced after a settlement of a criminal case with the government.

In 2012, BP reached the settlement with plaintiff's lawyers over economic and property damage claims arising from the spill. In its first-quarter earnings report for 2015, BP said it could estimate at least a $10.3 billion cost. But it also stressed that the cost could be higher, depending on how many legitimate claims were filed by a recently passed deadline.

Earlier this year, a federal judge in New Orleans concluded the third phase of a civil trial pitting the oil giant against the federal government. He had already made two key rulings: that BP acted with “gross negligence” in the rig explosion that resulted in the spill; and that 3.19 million barrels of oil — nearly 134 million gallons — spewed into the Gulf as a result. BP had appealed both those rulings, which set the stage for a possible multibillion-dollar Clean Water Act penalty.

The Associated Press