BP to Pay $61.2 Billion for Gulf Oil Spill

After one of the worst man-made environmental disasters in history, oil company BP has said that it will pay $61.2 billion to repair damages stemming from its 2010 oil spill in the Gulf of Mexico. The incident killed eleven workers, released approximately 3.2 million barrels of oil into the Gulf, and caused untold damages to local business, ecosystems, and wildlife.

Company Wants to Remove Financial Uncertainty

The announcement, which was made last week by BP chief financial officer Brian Gilvary, was meant to finally put a solid price tag on the company’s spill-related liabilities, and remove the company from financial uncertainty. The figure was reached after extensive negotiations with federal, state, and local officials, and is meant to help make those who suffered losses whole. Funds were also allocated to help restore the hundreds of square miles of land and sea which were affected by the spill.

Steep Penalties Meant to Send a Message

U.S. Attorney General Loretta Lynch signaled that the settlement was just punishment for BP’s negligence, and should serve as a stern warning to other companies of the steep price to be paid after a disaster of this magnitude. In comparison, the United States’ previous worst oil spill, the Exxon Valdez spill in Alaska in 1989, cost that company $4.3 billion in compensation and cleanup costs.

True Costs May Never Be Known

The true losses stemming from the BP oil spill may never be known. According to official figures at least 1,300 square miles of shoreline were affected, resulting in such extensive damage that six years later some habitats still show signs of the oil which spewed from the underwater well. There have been a reported 1,400 dead dolphins and whales which have washed up on shores in the affected areas since the spill, which is reportedly far higher than the numbers which would be expected under normal circumstances.

While BP had a relatively strong reputation for environmental responsibility before the disaster, its reputation has taken a severe hit in the spill’s aftermath. The company’s stock price has dropped dramatically as a result of the spill, but despite its hardships BP has defied many experts’ predictions and continued in business.