BP and thousands of plaintiffs announced late Friday that they have agreed to a settlement over the Deepwater Horizon disaster and oil spill that is estimated to cost BP about $7.8 billion. The settlement is still subject to final written agreement by U.S. District Judge Carl Barbier.
According to a statement released by BP, the settlement will create two classes of claims: one to resolve economic loss claims and another to resolve medical claims. The economic loss claims will compensate businesses, property owners and individuals who sustained economic damage from the oil spill and includes a financial commitment of $2.3 billion to help resolve economic loss claims related to the Gulf seafood industry. The medical claims will compensate a wide range of individuals along the Gulf Coast, including thousands of spill clean-up workers, and will provide medical consultation services for the next 21 years.
BP says that the payments are expected to be paid out from the $20 billion Trust set up previously to compensate Gulf Coast residents and businesses impacted by the spill. The settlement is not expected to increase the $37.2 billion charge BP previously recorded in its financial statements, according to BP.
Claims against BP by the U.S. Justice Department or other federal agencies for violations of the Clean Water Act or by the states and local governments are not included in the settlement.
The settlement also does not resolve claims the plaintiffs may make against Transocean (RIG, RIGN.VX), Halliburton (HAL), or Cameron International (CAM).
BP’s full statement with additional details about the settlement can be found HERE.