A large plume of smoke rises from fires on BP’s Deepwater Horizon offshore oil rig, in April 2010. Gerald Herbert/AP

By Dominic Rushe –

British Petroleum has agreed to pay a record environmental fine of $18.7 billion to settle legal actions brought by the U.S. and five Gulf states over the fatal Gulf of Mexico oil disaster of 2010.

The U.S. Department of Justice, along with the states of Louisiana, Mississippi, Alabama, Texas and Florida, all sued BP for damages not covered by the company’s earlier settlements with businesses and individuals harmed by the largest and most devistating offshore spill and environmental catastrphe in U.S. history.

The settlement ends all litigation between BP, the states and the federal government and allows the company to pay over 18 years. BP’s share price rose on the news.

Last September, judge Carl Barbier, who has overseen the tortuous legal case resulting from the disaster, ruled BP had been “grossly negligent” in its handling of the well. The decision opened up BP to the highest possible fines.

The company will pay $7.1 billion in “natural resource damage assessment,” and the money will be divided among the states and earmarked for environmental cleanup projects related to the spill. BP was fined $5.5 billion under the Clean Water Act.

The 2010 explosion at the Deepwater Horizon oil rig cost 11 lives and resulted in 4.2 million barrels of oil spewing into the Gulf over 87 days.

BP tried to argue that the volume of the spill was far lower. Barbier eventually ruled BP was responsible for the release of 3.1 million barrels. The spill affected the shore of the Gulf coast from Louisiana to Florida. Its impact on seafood, wildlife and human health is still being assessed.

“This agreement is the result of five years of hard-fought litigation and intense scientific research, and it provides Louisiana the coastal restoration and compensation it needs following the Deepwater Horizon disaster,” Louisiana attorney general James “Buddy” Caldwell said in a statement.

He said Louisiana, the state most affected by the spill, was recovering more than $10 billion from BP — more than any state has ever recovered for this type of case.

“This agreement lets us focus right away on improving the state without further litigation delays and appeals that could take years,” Caldwell said. “Iam extremely pleased by the work done by the Court and all the parties in this matter to reach an agreement that will bring great and historic benefits to Louisiana and the Gulf.”

Reacting to the news, BP chairman Carl-Henric Svanberg said: “Five years ago we committed to restore the Gulf economy and environment and we have worked ever since to deliver on that promise. We have made significant progress, and with this agreement we provide a path to closure for BP and the Gulf. It resolves the company’s largest remaining legal exposures, provides clarity on costs and creates certainty of payment for all parties involved.”

This story was originally published by the Guardian and is reproduced here as part of the Climate Desk collaboration and under a creative common license and as fair use.

More Photos

Brown pelicans with young and eggs on an island surrounded by BP oil in Barataria Bay Louisiana, June 2010: Glynn Wilson

BP’s oil stains Louisiana waters, kills marshes and wildlife: Glynn Wilson

Brown pelicans with young and eggs on an island surrounded by BP oil in Barataria Bay Louisiana, June 2010: Glynn Wilson

A great blue heron on West Beach in Gulf Shores looked shell-shocked as the wind carries the smell of BP’s spilled oil in June, 2010: Glynn Wilson

Left over oil and chemicals from the BP oil spill. See more images here. [Click on the image for a larger view]: Glynn Wilson