BP PLC plans to contest claims for oil spill-related damages from the states of Alabama, Mississippi, Florida, and Louisiana and some local governments concerning from the April 2010 blowout of the deepwater Macondo well off Louisiana and the resulting oil spill in the Gulf of Mexico.
Transocean Ltd. owned the Deepwater Horizon semisubmersible, which sank after an explosion and fire associated with the blowout. Eleven people aboard the semi were killed. The Deepwater Horizon drilled the Macondo well for BP and its partners.
Bob Dudley, BP chief executive, said BP will contest $34 billion in economic claims "vigorously in court."
The four states and others seek compensation for economic losses and property damage. BP believes those particular claims to be "substantially" overstated, saying it considers the methods used to calculate the $34 billion in claims, made by citing the Oil Pollution Act, to be flawed.
BP Chief Financial Officer Brian Gilvary said most of $34 billion in claims concern losses in potential tax revenues.
"That will be an interesting thing to try to prove given that we have provided one of the biggest fiscal stimuli that the gulf has ever seen,” Gilvary said.
Separately, BP continues talking with the federal government to try and avoid a related civil trial scheduled to start Feb. 25 regarding Clean Water Act liability.
In November 2012, BP announced resolution of criminal and securities claims by the US government (OGJ Online, Nov. 15, 2012).
That resolution involved a series of payments that total $4.5 billion over 6 years. BP and the US Department of Justice negotiated the agreement, which includes $1.256 billion in criminal fines. BP also agreed to 5 years’ probation.