On March 22, 2016, Department of Justice asked a federal judge to approve a proposed settlement reached in October 2015 to settle the government’s civil claim under the Clean Water Act and natural resources damage claims under the Oil Pollution Act.
The settlement agreement, worth over $20 billion, was initially announced last year in July by the Department of Justice and five Gulf Coast states.
The $20 billion settlement includes $7.1 billion for natural resource damages, $5.5 billion for Clean Water Act fines, and $4.9 billion in payments to five US states: Louisiana, Mississippi, Alabama, Florida and Texas. Several hundred local governmental bodies will receive up to $1 billion to settle claims for economic damages.
Department of Justice stated “With today’s action we take another step towards restoring the Gulf to its condition before the Deepwater spill – by bringing an unprecedented amount of resources that will be dedicating to this iconic ecosystem – and achieving justice for the American people”.
BP plans to pay off its penalty by making payments over the next 15 years. BP had previously estimated that it would pay out more than $1 billion annually over most of this period.
