BP to settle $18.7bn Deepwater Horizon claims

Agreements have been made with Alabama, Florida, Lousiana, Mississippi, and Texas to repay a $5.5bn civil penalty over 15 years, as well as natural resource damages of $7.1bn to the US and the five states over 15 years.

A further $4.9bn will be paid over 18 years to settle economic claims from the gulf states, and $1bn for claims from over 400 local government entities.

"The expected impact of these agreements would be to increase the cumulative pre-tax charge associated with the Deepwater Horizon accident and spill by around $10 billion from $43.8 billion at the end of the first quarter," the company stated in a release.

Bob Dudley, BP group chief executive, said: “This is a realistic outcome which provides clarity and certainty for all parties. For BP, this agreement will resolve the largest liabilities remaining from the tragic accident and enable BP to focus on safely delivering the energy the world needs.

“For the United States and the gulf in particular, this agreement will deliver a significant income stream over many years for further restoration of natural resources and for losses related to the spill.