Environment question over BP deal
BP's settlement with those suing the company over the oil spill disaster in the Gulf of Mexico may address harm to individuals and businesses, but there is nothing that compensates the public for damage to its natural resources and environment, the US Justice Department has said.
That is a potentially critical issue because a separate victims' claims fund that was set up months after the Deepwater Horizon rig explosion was also meant to cover environmental damages, but it is now expected to be used to cover the BP settlement with plaintiffs.
BP said it expected to pay out 7.8 billion dollars (£4.9 billion) in the settlement with the plaintiffs that was announced on Saturday.
It is not clear whether environmental claims will now have to be addressed separately between BP and the US government, or whether it will be rolled up into their discussions over settling the fines and penalties that the oil giant faces. Both issues could also be resolved at an eventual civil trial, which has now been postponed indefinitely.
The Justice Department noted that the settlement does not address "significant damages" to natural resources and the environment. The agency said: "While we are pleased that BP may be stepping up to address harms to individual plaintiffs, this by no means fully addresses its responsibility for the harms it has caused."
The 2010 spill soiled sensitive tidal estuaries and beaches, killed wildlife and closed vast areas of the Gulf to commercial fishing for months. Dispersants and siphoning equipment and other methods were successful in getting rid of much of the oil in the ocean, but some environmentalists believe oil beneath the surface could return one day to Gulf shores.
David Uhlmann, a University of Michigan Law School professor who previously served as chief of the Justice Department's environmental crimes section, estimates that a deal between BP, the government and the states - one that includes criminal and civil penalties and resolves natural resource damage claims - would be worth 20-25 billion dollars (£12.6-£15.8 billion).
BP still has to resolve claims by the US government, Gulf states and its partners on the doomed Deepwater Horizon rig, which exploded and sank 50 miles off Louisiana after a BP oil well a mile below the ocean's surface blew out.
Eleven rig workers were killed and, according to the government, more than 200 million gallons of oil spewed before the well was capped nearly three months later.
Rig owner Transocean and cement contractor Halliburton have rejected recent overtures to settle their claims with BP and pay billions of dollars, according to two people close to the case. But legal observers expect that could change now that BP and the Plaintiffs Steering Committee have reached a settlement.