Judge denies BP appeal over Gulf spill payouts

A judge again upheld an agreement to pay individuals and businesses for claims related to BP Plc's 2010 Gulf of Mexico spill, as the oil company seeks to avoid the potential for escalating costs from the settlement it reached last year.

Federal District Judge Carl Barbier said he found no reason to reverse a decision he made last month to uphold the payout process, even though BP insisted some of the claims were "fictitious" and "absurd".

Patrick Juneau, the court-appointed administrator overseeing the payouts, had urged dismissal of BP's lawsuit and argued he deserved judicial immunity to allow for "principled" decision making.

Barbier told a New Orleans federal court he could not see a situation where either Juneau or the settlement program was breaching the agreement, which is uncapped but originally estimated by BP to be for about $7.8 billion.

Barbier is also hearing a civil claims trial in the same court to determine blame for the 2010 disaster at the Macondo well, and that trial will start its seventh week on Monday.

The accident killed 11 people and triggered the worst offshore oil spill in U.S. history. BP has already estimated it will spend more than $42 billion to cover clean-up, fines and other liabilities, and has sold off assets to cover its costs.

Barbier said BP was only making the legal move on the claims process in an attempt to get that part of the case to the Fifth Circuit Court of Appeals.

"What you're really trying to do - it's quite obvious and there's no subtlety here - is you're trying to get this issue to the Fifth Circuit," Barbier said.

"If you believe you have a right to appeal, you can take that up with the circuit and then ask me to stay the order," Barbier added. "I don't know why we're going through all these machinations."

The larger trial heard by Barbier is In re: Oil Spill by the Oil Rig "Deepwater Horizon" in the Gulf of Mexico, on April 20, 2010, U.S. District Court, Eastern District of Louisiana, No. 10-md-02179.

(Reporting by Kathy Finn in New Orleans; Writing by Braden Reddall; Editing by Gary Hill and David Gregorio)