BP Seeks to Rein in Oil Spill Claims
The UK oil company has for months been seeking ways to restrain settlement claims, arguing its financial recovery is in peril and that it may become a takeover target, because of fictitious and inflated claims. BP had reportedly planned last month to ask British prime minister David Cameron to intervene with the US government over the rising cost of compensation related to the 2010 Gulf of Mexico oil spill.
BP has now protested in court filings that administrator Patrick Juneau’s interpretation of last year’s settlement may add billions to its $42 billion bill, reported Bloomberg. BP says the interpretation is wrong.
In March, BP asked a federal court judge in New Orleans on Friday to put a hold on claims that are paid out as business economic losses.
Under the terms of the BP settlement, economic losses suffered by businesses in the region are presumed to have been caused by the oil spill if they meet certain numerical criteria, reported Bloomberg. BP didn’t negotiate a requirement that businesses prove their losses were caused by the spill in order to get paid.
BP originally estimated economic and medical-injury claims to private parties would cost about $7.8 billion. The company has since raised that estimate to at least $8.5 billion and now says it can no longer publicly predict how much the settlement will cost, reported Bloomberg.
The settlement claims are on top of BP’s billions of dollars worth of fines. In November, BP agreed to pay $4.5 billion and pleaded guilty to eleven counts of misconduct or neglect of ship officers, one count of obstruction of Congress, one misdemeanor count of a violation of the Clean Water Act, and one misdemeanor count of a violation of the Migratory Bird Treaty Act, all arising from its conduct leading up to or its response after the Deepwater Horizon disaster.
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