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BP to Pay $20.8 Billion for Oil Spill

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BP PLC will be fined $20.8 billion by the U.S. government to help repair damages from the 2010 Deepwater Horizon oil spill.

BP, responsible for the largest marine oil spill in history, will shell out billions to finalize an agreement between the company and the federal government and resolve all civil cases from the Department of Justice and five gulf states.

$5.5 billion of the funds will pay for penalties resulting from the Clean Water Act. Alabama, Florida, Louisiana, Mississippi, and Texas, which all saw affects of the oil spill on their coastal beaches, will receive large portions of the settlement to cover their own environmental damages.

The funds, which U.S. Attorney General Loretta Lynch called “the largest settlement with a single entity in American history,” will be in addition to the reported $28 billion BP has already expended on mandated cleanup and compensation.

But according to the Los Angeles Times, more than $5 billion of that amount could fall on American taxpayers, as BP is able to claim a large portion as tax deductible.

Michelle Surka with the U.S. Public Interest Research Group criticized the deduction as harmful to areas affected by the spill. “This not only sends the wrong message,” Surka said, “but it also hurts taxpayers by forcing us to shoulder the burden of BP’s tax windfall in the form of higher taxes, cuts to public programs, and more national debt.”

Five years after the spill that dumped 4.9 million barrels of oil into the Gulf of Mexico, scientists still say marine wildlife and coastal habitats are still struggling to recover. According to Lynch,  the money from BP’s final settlement makes the best of a terrible tragedy and “will launch one of the largest environmental restoration efforts the world has ever seen” with hopes of returning the Gulf to its former condition. “Taken as a whole, this resolution is a strong and fitting response,” said Lynch. ” BP is receiving the punishment it deserves, while also providing critical compensation for the injuries it caused to the environment and the economy of the Gulf region.

BP to Pay $20.8 Billion for Oil Spill