Details of the BP settlement with the government and five Gulf States include $18.7 billion in restitution to settle all federal and state claims across 18 years, with $5.5 billion of it in civil penalties and $7.1 billion for damage to natural resources, notes the BP website. This does not include settlements from individual businesses, which are estimated to be slightly more than $2 billion.Continue Reading
The oil spill that occurred in the Gulf of Mexico affected five states and thousands of miles of coast line. The initial $18.7 billion, which is much more than the $10 billion estimate that the company had planned for. There have been approximately 115,000 companies that applied for settlements by the deadline.
The civil penalties that the company has to pay is due to the Clean Water Act. The amount will be paid back during the course of 15 years. The $7.1 billion that goes to national resource damages will be paid during the same time period. These payments are scheduled to start 12 months after the settlement becomes final. The payment averages out to $1.1 billion per year. Another $4.9 billion will go to cover economic and other claims made by the Gulf Coast states. The state claims will get a large initial payout the year of settlement, with a two-year break before smaller settlements begin two years after that, as shown by the BP website.Learn more about Corporations