BP has reached agreement with Anadarko Petroleum Company to settle all claims between the companies related to the Deepwater Horizon accident. Anadarko, which had a 25% interest in the Macondo well, and BP have concluded that entering into a settlement is in the best interest of the parties to resolve pending disputes. Although the agreement is not an admission of liability by any party regarding the accident.
Under the settlement agreement, Anadarko will pay BP US$ 4 billion in a single cash payment. BP will apply the payment to the US$ 20 billion trust it established that is available to meet all claims, as well as the cost of the natural resource damages. Anadarko will also transfer all of its 25% interest in the MC252 lease to BP.
The payment brings all pending disputes between the two parties to a halt and Anadarko and BP have agreed to work cooperatively with respect to indemnified claims, and Anadarko has the opportunity for a 12.5 per cent participation in future recoveries from third parties or insurance proceeds cumulatively exceeding $1.5 billion, up to a total cap of $1 billion.
Finally, the parties have also agreed to mutual releases of claims against each other. BP has agreed to indemnify Anadarko for certain claims arising from the accident. However, BP’s indemnity excludes civil, criminal or administrative fines and penalties, claims for punitive damages, and certain other claims.
“This settlement represents a positive resolution of a significant uncertainty and it resolves the issues among all the leaseholders of the Macondo well,” said Bob Dudley, BP group chief executive. “There is clear progress with parties stepping forward to meet their obligations and help fund the economic and environmental restoration of the Gulf. It’s time for the contractors, including Transocean and Halliburton, to do the same.”
Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/17102011/bp_reaches_4_billion_dollar_macondo_settlement_with_anadarko/