Enter your email address and start getting breaking law firm and legal news right now!
British Petroleum Appealing: Oil Spill Liabilities are Just too Costly
British Petroleum will be forced to live with a $9.2 billion dollar settlement for the people affected by the Gulf of Mexico oil spill. The energy and oil giant had previously claimed that there was significant misinterpretation of their deal, but a federal appeals court judge threw that argument out.
British Petroleum is the second largest oil company, and while they did have a nasty spill, they are appealing their former judgment and are trying to reduce their liabilities. Regardless of their legal issues, their share price is still up. Analysts often look at these spills as one time problems with fixed expenses attached to them, and calculate their cost as extraordinary items. As a result, the spills do not truly affect the valuation; there is no question however, that some analysts will consider this market slightly riskier. However, relative to increasing energy needs of the mature markets and specifically the growing economies, these one-time events will likely not change the overall outlook of oil and energy giants like British Petroleum.
In the aftermath of the deep-water Macondo well blowout which hurled millions of barrels of oil into the Gulf of Mexico, BP’s liabilities were valued at almost $10 billion dollars. Spokesmen for BP are asking the court to only consider claimants for the settlement to be those whose economic-loss resultant from the spill can be directly traced to BP. Or in other words, they prefer a very narrow definition of who actually can be a claimant. However, a panel of judges were not convinced by anything BP said, and the protections will largely be given to all of the people affected; BP will have to pay, according to Bloomberg. According to the same site, “the case is In Re. Deepwater Horizon, 13-30315, U.S. Court of Appeals for the Fifth Circuit (New Orleans). The lower-court case is In Re: Oil Spill by the Oil Rig Deepwater Horizon in the Gulf of Mexico on April 20, 2010, MDL-2179, U.S. District Court, Eastern District of Louisiana (New Orleans).”
Image credit: BBC
British Petroleum Appealing: Oil Spill Liabilities are Just too Costly by Jaan