Oil giant BP plc (BP) has announced that it will appeal in the U.S. Supreme Court to review a court order on a settlement tied to its 2010 Gulf of Mexico (GoM) oil spill. The company will appeal for a ruling by a lower court concerning the quantum of damage payments to businesses affected by the spill.
On May 19, the 5th U.S. Circuit Court of Appeals in an 8 to 5 vote denied BP’s request for a rehearing on its settlement dispute before the entire court. The bone of contention per the company is that the lower court ruling will force it to pay for economic damages to business without the claimants having to prove their losses resulted from the spill.
As a reminder, on Apr 20, 2010, offshore driller Transocean Ltd’s (RIG) ultra-deepwater Horizon drilling platform, contracted to BP, sank following an explosion while operating in the U.S. GoM off the coast of Louisiana. The incident killed 11 workers and spewed more than 200 million gallons of crude in what was touted as the country’s worst oil spill ever. Subsequently, a moratorium was imposed on offshore drilling at water depths of more than 500 feet in the region, which was lifted on Oct 12, 2010.
The breach of Clean Water Act along with other laws led the U.S. government to take legal action against the main defendants in the trial – BP, Transocean and Halliburton Company (HAL). Several other companies are also involved in the trial.
BP estimates the total payment under the spill compensation to exceed $9.2 billion. Under a substantial settlement deal reached last spring, thousands of Gulf Coast businesses and residents hurt by the 2010 BP oil spill in the Gulf of Mexico have started to receive payments.
London-based BP plc is one of the world's largest energy companies, providing its customers with fuel for transportation, energy for heat and light, retail services and petrochemical products. It operates in three segments: Exploration and Production, Refining and Marketing, and Other Businesses and Corporate.
BP – U.K.’s third largest oil company by market value after Royal Dutch Shell plc (RDS.A) – holds a Zacks Rank #3 (Hold).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment