April 23, 2024

BP Partner Agrees to $1.1 Billion Settlement Related to Gulf Spill

LONDON — BP said Friday that Moex Offshore, one of its partners in the oil well that leaked into the Gulf of Mexico last year, has agreed to pay $1.1 billion as part of a settlement for any claims related to the oil spill.

Moex, which had a 10 percent stake in the well, is the first company aside from BP to make a payment towards covering the costs of the disastrous oil spill, BP said in a statement. The agreed payment is about half of a total $2.1 billion BP had sought from Moex in monthly invoices for reimbursement of costs, including interest, according to Mitsui of Japan, which owns Moex.

The settlement covers all claims related to the well accident and would immediately go to the $20 billion trust that was set up to compensate fishermen and other local residents and businesses that were affected by the oil spill, BP said.

“Moex is the first company to join BP in helping to meet our shared responsibilities in the gulf,” the BP chief executive, Robert W. Dudley, said. “This settlement is an important step forward for BP and the gulf communities.”

BP set aside $40 billion to cover costs and liabilities linked to the oil spill, the worst ever in the United States. The London-based firm has already raised $25 billion by selling assets and is seeking to sell some more oil and gas fields in Britain and two refineries in the United States. So far BP has paid almost $6 billion in claims.

Mr. Dudley called “on the other parties involved in the Macondo well to follow the lead.”

The April 20, 2010, explosion of the rig killed 11 workers and resulted in a spill that poured nearly five million barrels of oil into the Gulf of Mexico. Since the accident companies involved in the well — BP; Transocean, which operated the rig; and Halliburton, which was responsible for cement work at the well — have engaged in recriminations and lawsuits, with each accusing the others of negligence. BP has filed claims worth tens of billions of dollars against Transocean and other partners in the United States.

BP said it was in talks with its other partners on the well to also “contribute appropriately,” It was also seeking payments from Anadarko, which owned a quarter of the project, BP said.

Moex agreed to the settlement to “reduce the risk and uncertainty for its shareholders,” Mitsui said in a statement. “Doing so will also make it possible for Mitsui to focus on the future growth of its business.”

The settlement is not an admission of liability by Moex or BP, BP said. BP also agreed to indemnify Moex for claims for compensation arising from the accident, excluding civil, criminal or administrative fines and penalties.

Like BP, Moex also recognized the findings by a presidential commission in its investigation into the causes of the oil spill. The commission found that the accident was the result of mistakes by a number of parties and different causes.

Moex also acknowledged a study by the U.S. Coast Guard released in April, which concluded that poor maintenance, inadequate training and a lax safety culture at Transocean contributed to the lethal explosion. Transocean rejected the report’s findings.

Moex is a subsidiary of Mitsui, a Tokyo-based commodity trading and financing company.

Article source: http://www.nytimes.com/2011/05/21/business/global/21bp.html?partner=rss&emc=rss

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