BP to Pay $4.5 Billion in Oil Spill Settlement
BP stated Thursday that it will pay $4.5 billion in a settlement with the U.S. government and plead guilty to felony accounts over the 2010 massive oil spill.
The settlement includes nearly $1.3 billion in criminal fines. This is the largest corporate penalty fine ever. Previously, drug company Pfizer had the highest fines for $1.2 billion in 2009.
Under the settlement terms, $2.4 billion will be paid to the the National Fish and Wildlife Foundation, while $350 million will go to the National Academy of Sciences and $500 million will be granted to the Securities and Exchange Commission.
In addition to the penalty fines, three BP employees are facing manslaughter charges for 11 deaths from the enormous oil spill.
BP's Chairman Carl-Henric Svanberg said, "We believe this resolution is in the best interest of BP and its shareholders. It removes two significant legal risks and allows us to vigorously defend the company against the remaining civil claims."
Since the spill, the oil industry and government officials have assessed the risks of deep water drilling and have made efforts to find safer drilling methods, while also working on developing better disaster plans.
BP still faces claims from private entities which are not covered in their offered settlement including: financial institutions, casinos and racetracks, insurance companies, local governments and losses caused by a government-imposed moratorium on post-spill drilling.
A report created by a group of Coast Guard officials and federal regulators in September 2011 concluded BP is to blame for the spill. The report stated BP should take full responsibility for violating federal regulations, neglecting vital warning signs and making poor decisions in cementing a well only a mile underneath the Gulf of Mexico.
