In Final BP Deal, Texas to Get $800 Million for Gulf

Texas and four other Gulf Coast states have reached a final settlement with BP stemming from the 2010 Deepwater Horizon explosion and oil spill, the U.S. Department of Justice and states announced Monday

The $20.8 billion deal is the largest settlement with a single entity in American history and includes the largest civil penalty in the history of environmental law. It resolves all state claims against the company for its role in the disaster, which killed 11 people and spewed millions of barrels of oil into the Gulf of Mexico.

The Texas share totals more than $800 million in money and restoration projects. Combined with previous settlements, Texas will have received more than $1 billion to rejuvenate and bolster resources along the Gulf, Texas Attorney General Ken Paxton said. 

“The disaster of Deepwater Horizon was a tragedy that touched people’s lives all along the Gulf Coast, from those who love its natural beauty and wildlife, to those who make their living from the water,” Paxton, a Republican, said in a statement. “This agreement will help restore our natural resources and strengthen the communities that rely on them. Texas as a whole will benefit from this settlement.”

BP will pay more under this settlement than it would have under a preliminary deal unveiled in July. At the time, Paxton pegged that deal at $20.2 billion, including more than $788 million for Texas.

Under the agreement:

  • BP will pay $5.5 billion in federal Clean Water Act fines over 15 years – $4.4 billion of which will fund Gulf-wide projects in the state’s federal RESTORE Act plans. At least $430 million of that money will flow to Texas.
  • BP will pay about $8.1 billion (including about $1 billion already paid for “early restoration projects”) over 15 years for natural resources damages under the federal Oil Pollution Act. About $238 million from that pot will directly benefit restoration in Texas. The Obama administration released a proposal of its Gulf-wide plan Monday.
  • BP will pay $4.9 billion over 19 years for economic damage to the states, including about $150 million for Texas.
  • BP will pay up to $1 billion to resolve claims by hundreds of local governments across the Gulf.

Under a separate order, BP will pay Texas more than $1 million in attorneys’ fees, according to Paxton’s office, which will decide whether to formally approve the deals following 30 days of public comment.

The agreement completes a series of settlements that had already yielded some $275 million for Texas restoration projects, including, last year, the largest conservation land purchase in Texas history – some 17,000 acres of undisturbed coastal prairie in Calhoun County.

Some of the Texas money will flow to two “Centers for Excellence,” university consortiums.

The University of Houston leads one consortium, which focuses on offshore energy development, including research and technology to improve the sustainable and safe development of energy resources in the Gulf of Mexico.

Texas A&M University-Corpus Christi leads the other consortium, which has similar goals, including research related to sustainability, restoration and protection of the coast and deltas. Several projects are already underway, thanks to money from earlier settlements. That includes an effort to create the largest Gulf of Mexico data and information system.

Though the settlement would close the book on Texas’ legal wrangling with BP, it could see more damage payments from the disaster at large. The state is still considering a settlement offer with rig owner Transocean Offshore Deepwater Drilling Inc., which includes $2 million in economic damage.

Disclosure: BP is a corporate sponsor of The Texas Tribune. A complete list of Tribune donors and sponsors can be viewed here.

Source: Energy

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