BP Plc's agreement on Thursday to pay the U.S. government $4.5 billion is a big step toward resolving its liability for the Gulf of Mexico oil spill in 2010.
But the company still faces significant liabilities, including potential civil penalties of up to $21 billion under the U.S. Clean Water Act as well as some outstanding claims from private plaintiffs.
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BP said on Thursday it would defend itself vigorously against remaining claims against it.
Based on a rough calculation of estimates from analysts and some previously paid items, BP's total bill from the spill could exceed $58 billion. The following is a breakdown of outstanding and previously paid liabilities.
FEDERAL PENALTIES AND FINES: $4.5 billion
The $4.5 billion announced on Thursday will be paid over six years. It includes a $1.256 billion criminal fine; $2.394 billion for the National Fish & Wildlife Foundation; $340 million for the National Academy of Sciences; and a $525 million civil penalty to the SEC.
The announcement follows months of negotiations between BP and the Justice Department, which launched a criminal probe soon after the spill.
LIABILITY TO PRIVATE PLAINTIFFS: AT LEAST $14.3 billion
Hundreds of thousands of fishermen, oyster men, hoteliers, restaurateurs and other businesses have sued BP for damages. BP has paid out about $6.5 billion on 200,000 claims through its Gulf Coast Claims Facility. In March, it agreed to pay an additional estimated $7.8 billion to settle a further 125,000 claims, subject to approval by a judge.
That settlement excludes certain businesses, such as casinos, and plaintiffs who opted out of the deal. Stuart Smith, a New Orleans attorney who represents spill victims, said claims from those parties could cost BP billions of dollars more.
CLEAN WATER ACT: $5.4 billion to $21 billion
The federal Clean Water Act envisions fines of up to $1,100 per barrel spilled, rising to $4,300 a barrel if gross negligence or willful misconduct is found. Assuming a spill of 4.9 million barrels, the fine could be between $5.4 billion and $21 billion. BP, which has set aside $3.5 billion for the purpose, said on Thursday it would contest allegations of gross negligence.
ENVIRONMENTAL DAMAGE: $5 billion
The U.S. government is undertaking a multi-year study of the ecological damage caused by the spill in Louisiana, Florida, Mississippi and Alabama. It could be years before the damage assessment is complete, and the states could choose to settle in the meantime. Morgan Stanley has pegged the cost of environmental damage and recovery at $5 billion. Some state officials have said that figure as too low.
OPERATIONAL RESPONSE: $14 billion
As the responsible party for the spill under the Oil Pollution Act, BP has so far spent more than $14 billion, including the cost to cap the mile-deep Macondo well, hire hundreds of marine vessels to skim oil slicks and clean up hundreds of miles (km) of oil-soaked shoreline in five U.S. states.
(Reporting by Andrew Longstreth; Editing by Bob Burgdorfer)