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Friday, May 24, 2024 | Back issues
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BP Will Pay $4.5 Billion|to U.S. for Massive Spill

(CN) - BP will pay $4.5 billion and plead guilty to felonies to settle federal charges over the 2010 oil disaster that resulted in 11 deaths, the company said Thursday.

The deal reportedly marks the largest penalty of its kind, toppling an honor previously held by Pfizer after it agreed to a $1.2 billion fine in 2009.

"As part of the resolution, BP has agreed to plead guilty to 11 felony counts of Misconduct or Neglect of Ships Officers relating to the loss of 11 lives; one misdemeanor count under the Clean Water Act; one misdemeanor count under the Migratory Bird Treaty Act; and one felony count of obstruction of Congress," according to a statement on BP's website.

BP Chairman Carl-Henric Svanberg told shareholders in a statement that the resolution "removes two significant legal risks and allows us to vigorously defend the company against the remaining civil claims."

Executives of the London-based company allegedly lied to Congress about the size of the April 20, 2010, spill, which dumped millions of gallons of oil into the Gulf of Mexico.

The $4.5 billion figure includes a $1.2 billion criminal fine, a payment of nearly $2.4 billion to the National Fish & Wildlife Foundation, and a $350 million payment to the National Academy of Sciences. All of the amounts are payable over five years. The Securities and Exchange Commission will collect $525 million of the settlement over a period of three years.

Claims against BP still outstanding include "federal civil claims, including those arising under the Clean Water Act," according to the company's statement.

BP says it also still faces "federal and state Natural Resource Damages claims; private civil claims pending in MDL 2179 that were not covered by the settlement with the Plaintiffs' Steering Committee (PSC); private securities claims pending in MDL 2185; state economic loss claims; and miscellaneous private civil claims pending in other federal and state courts."

Back in March , BP reached a $7.8 billion settlement to compensate 116,000 Gulf Coast fishermen, hotel owners, restaurant workers and seafood processors who lost income because of the Deepwater Horizon disaster.

U.S. District Judge Carl Barbier in New Orleans has been overseeing the sprawling claims over the spill.

Rep. Ed Markey, D-Mass, has been the lead congressional investigator into the spill with the Natural Resources Committee.

He called the settlement "appropriate" in a statement Thursday.

"People died, BP lied to Congress, and millions of barrels of oil poured into the Gulf," Markey said. "This steep cost to BP will provide the Gulf coast some of the funds needed to restore the region, and will hopefully deliver some comfort and closure to the families and businesses affected by the spill."

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