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Will The Settlement Cost From BP Oil Spill Cover Future Damage?

Late last week, the federal government and 5 Gulf states announced an $18.7 billion dollar settlement over the 2010 oil spill in the Gulf of Mexico. While it represents the largest settlement in American history, some experts say the amount for the damage done barely scratches the surface.

 

BP agreed to settle all federal, state and local claims.

Houston oil industry expert Barbara Shook, with Energy Intelligence Group, says the oil giant expected to pay more.

“They had $32 billion in cash on hand,” says Shook. “They still do have civil liabilities from lost business that were not covered by this settlement. They’re going to have to pay a lot of money on and that’s still an unknown.”

In a statement released by the company, BP said the agreement provides a path to closure.

Shook says the settled amount cannot be adjusted.

“If new damages are discovered at a future date, the settlement can’t be re-opened, and treating those costs for those damages is not adressed at all,” Shook says.

Investigative journalist Antonia Juhasz is the author of several books on the oil industry, including one on the BP oil disaster. She says the environmental impact continues to be determined.

“I was recently in a submarine at the bottom of the Gulf of Mexico, looking at the site of BP’s oil spill, and what’s down there is a huge blanket of oil,” Juhasz says.

Of the five states involved in the settlement agreement, Louisiana will recieve $7.8 billion dollars for environmental and economic damage.

Compensation for Texas totals nearly $800 million.

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