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BP recovers $4bn in oil spill costs

Oct 17 2011 09:29

London - British energy giant BP said Monday it had recovered $4bn in costs linked to last year's devastating Gulf of Mexico oil spill from US group Anadarko Petroleum Company.

"BP today announced that it has reached agreement with Anadarko Petroleum Company to settle all claims between the companies related to the Deepwater Horizon accident," BP said in a statement

Anadarko has also agreed to transfer to BP its 25% stake in the Macondo well, where a leak in 2010 sparked an environmental catastrophe on the US Gulf coast.

"This settlement represents a positive resolution of a significant uncertainty and it resolves the issues among all the leaseholders of the Macondo well," BP chief executive Bob Dudley said in the statement.

"There is clear progress with parties stepping forward to meet their obligations and help fund the economic and environmental restoration of the Gulf.

"It's time for the contractors, including Transocean and Halliburton, to do the same," he added.

The US government last week slapped BP, Transocean - the Swiss owner and operator of the drilling rig - and US oil services group Halliburton with citations for violating oil industry regulations in what is expected to lead to massive fines for the deadly 2010 oil spill.

The decision to also cite BP's subcontractors could strengthen the British energy giant's legal case for recovering some of the multi-billion dollar costs of the spill from Halliburton and Transocean.

Halliburton designed and pumped the well's cement, found to be a key factor in the accident.

The Macondo leak was triggered by an explosion on the BP-leased Deepwater Horizon rig in the Gulf of Mexico on April 20, 2010. The blast killed 11 workers, caused millions of barrels of oil to spew into the sea and left the British company scrambling to meet huge compensation costs.

BP said its agreement with Anadarko was "not an admission of liability by any party regarding the accident."

It added in the statement: "Under the settlement agreement, Anadarko will pay BP $4bn in a single cash payment.

"BP will apply the payment to the $20bn trust it established that is available to meet individual, business and government claims, as well as the cost of the natural resource damages.

"Anadarko will also transfer all of its 25% interest in the MC252 (Macondo) lease to BP."

In order to meet its own compensation costs and raise $30bn by the end of 2011, BP is selling assets. The British group last week said it had so far paid out about $7bn in compensation claims arising from the deadly oil spill.

bp  |  oil spill



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