BP Reaches $7.8 Billion Settlement to Resolve Economic, Medical Claims Stemming from Gulf Oil Spill

BP Reaches $7.8 Billion Settlement to Resolve Economic, Medical Claims Stemming from Gulf Oil Spill

On April 18, only days before the second anniversary of the Deepwater Horizon explosion and subsequent oil spill in the Gulf of Mexico, BP reached an agreement to settle personal economic and medical claims resulting from the disaster. The settlement, estimated to amount to $7.8 billion, will compensate more than 100,000 claimants affected by the spill.

The Deepwater Horizon rig exploded April 20, 2010, killing 11 workers and sending millions of barrels of oil gushing in the Gulf of Mexico. The incident sparked an environmental catastrophe and put residents, cleanup workers, the environment and those who earned their living fishing or working near the Gulf at risk. This class-action settlement, which BP reached with the Plaintiffs’ Steering Committee (PSC), will resolve the majority of eligible private economic loss and medical claims stemming from the explosion and oil spill.

"The people and businesses of the Gulf Coast stand to reap great benefits from these settlements," said Plaintiffs' Co-Liaison Counsel James P. Roy and Stephen J. Herman. "We have held BP fully accountable for the Deepwater Horizon tragedy less than 2 years after the spill. Through extensive arms-length, good faith negotiations, hundreds of thousands of Gulf Coast residents and businesses will be made whole."

The settlement agreements filed today are consistent with the terms of the proposed settlement announced in March.

Economic and Medical Claims

BP and PSC jointly filed for preliminary Court approval for two separate class settlement agreements – one resolving economic and property damage claims, the other resolving medical claims stemming from the response effort.

The economic and property damages settlement will compensate businesses and individuals for the following types of losses suffered as a result of the Gulf oil spill: individual and business economic losses, coastal real property damage, wetlands real property damage, real property sales loss, vessels property damage, loss of subsistence use, Vessels of Opportunity underpayment and a program to compensate harvesters of Gulf seafood.

The medical benefits settlement will provide compensation to cleanup workers and Gulf Coast residents suffering from a wide range of specified physical conditions, establish a 21-year periodic medical consultation program and create a Gulf Region Health Outreach Program through a $105 million grant. Claimants eligible for the medical settlement include cleanup workers and residents living in certain Zone A (beachfront areas within one-half mile of the water) or Zone B (wetlands areas within one mile of the water) areas.

The Court will set a fairness hearing, after which it will rule on whether to grant final approval of the settlements. In the meantime, eligible claims will continue to be processed and paid.

"This settlement demonstrates BP’s continued progress in resolving significant issues related to the Deepwater Horizon accident," said BP Group Chief Executive Bob Dudley. "BP made a commitment to help economic and environmental restoration efforts in the Gulf Coast, and this settlement provides the framework for us to continue delivering on that promise, offering those affected full and fair compensation, without waiting for the outcome of a lengthy trial process."

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