4th Mar 2014 09:55
LONDON (Alliance News) - BP PLC Tuesday said it disagreed with the decision by the US court of appeals, which denied the company's request for a permanent injunction preventing certain payments in compensation for the Deep Sea Horizon oil spill.
The major oil and gas company said it continues to believe some of the business economic-loss claimants are not proper class members under the terms of the settlement, and it is considering its options for appeal.
The company was told on Monday by a federal appeals court that it must abide by terms of a USD9.2 billion settlement with business-loss claimants of the oil spill, and the court rejected claims that the administrator is misinterpreting the financial ramifications of the spill.
BP had managed to halt payments in December, arguing that certain companies making claims were not directly affected by the oil spill, the worst in US history.
?In light of our reading of the settlement agreement,? US Circuit Judge Leslie Southwick wrote in the ruling, ?we conclude the settlement agreement does not require a claimant to submit evidence that the claim arose as a result of the oil spill.?
BP said it believes that the decision will improperly allow for the payment of losses with no connection to the spill and noted that it has already sought a rehearing of decisions by a separate panel decision in January which also upheld the validity of the settlement.
The company also noted that at December 31 it held no provision for these claims payable under the settlement because no reliable estimate could be made. It said that, if necessary, a provision will be made when the issues are fully resolved.
In April 2010, the deep-water horizon blow out and subsequent oil spill in the Gulf of Mexico killed 11 people and released millions of barrels of oil.
The company settled some liabilities in March 2012 and initially valued its total loss at USD7.8 billion. However, last year, BP increased this figure to USD9.2 billion.
BP shares were down 0.1% to 492.22 pence Tuesday morning.
By Tom McIvor; [email protected]; @TomMcIvor1
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