BP announced that it has reached definitive and fully documented agreements with the Plaintiffs’ Steering Committee (PSC) to resolve the substantial majority of eligible private economic loss and medical claims stemming from the Deepwater Horizon accident and oil spill. The parties have filed for preliminary court approval of the two settlement agreements, one resolving economic loss and property damage claims and the other resolving medical claims.
BP estimates that the cost of the settlement will be approximately $7.8b, including administration costs and plaintiffs’ attorneys’ fees and expenses, and is expected to be paid from the $20b Trust. The Trust is available to satisfy not only legitimate individual and business claims but also to pay certain other costs related to the accident and oil spill, including state and local government claims, state and local response costs, natural resource damages and related claims, and final judgments and settlements. While BP has sought to reliably estimate the cost of the settlement agreements, it is possible that the actual cost could be higher or lower than this estimate depending on the outcomes of the court-supervised claims processes. In accordance with its normal procedures, BP will reevaluate the assumptions underlying this estimate on a quarterly basis as more information, including the outcomes of the court-supervised claims processes, becomes available.