Minority partner to pay $90 million over oil spill
NEW ORLEANS (AP) — A minority partner in BP's blown-out well in the Gulf of Mexico agreed Friday to pay $90 million in a settlement with the federal government and Gulf states over the 2010 oil spill. It includes the largest civil penalty ever recovered under the federal Clean Water Act.
MOEX Offshore 2007 LLC owned 10 percent interest in the Macondo well, about 50 miles off the Louisiana coast. The well blew out in April 2010, destroying the BP-leased rig Deepwater Horizon, killing 11 men and resulting in the nation's worst offshore oil spill.
The agreement, filed in U.S. District Court in New Orleans, calls for MOEX to pay $45 million in civil penalties to the federal government and $25 million to the Gulf states affected by the spill. The company also agreed to pay $20 million for coastal protection projects.
The Justice Department said the agreement is the largest civil penalty ever recovered under the clean water law that was enacted in 1972.
"The Department of Justice has not wavered in its commitment to hold all responsible parties fully accountable for what stands as the largest oil spill in U.S. history," said Attorney General Eric Holder said in a statement. "This landmark settlement is an important step — but only a first step — toward achieving accountability and protecting the future of the Gulf ecosystem by funding critical habitat preservation projects."
MOEX is the first company involved in the disaster to settle with the federal government over the spill. The federal government also sued BP, rig owner Transocean Ltd. and another minority partner in the well, Anadarko Petroleum Corp.
A federal trial in New Orleans designed to determine the causes of the blowout that spewed millions of gallons of oil into the Gulf is scheduled to start Feb. 27.
Also on Friday, BP and M-I LLC, a Houston-based drilling mud company used at the Macondo well, said they were dropping their claims against each other in federal court. BP had accused M-I of several missteps when the drilling mud was replaced by seawater in the process of sealing the well before it blew out. For its part, M-I said it was shielded from responsibility for the blowout by a contract it had with BP and accused the oil giant of causing the blowout.
Both companies said Friday that terms of the agreement were confidential.
"BP and M-I Swaco have decided to resolve their differences without the need for further litigation," said BP spokesman Scott Dean
BP, the majority owner of the well, has been in talks with the federal and state governments and plaintiffs' attorneys to settle tens of thousands of claims before the trial. BP faces billions of dollars in fines and penalties, so any deal it reaches will dwarf the MOEX settlement.
MOEX Offshore, a wholly owned subsidiary of MOEX USA Corp. and unit of Japanese trading house Mitsui & Co., no longer owns any share of the lease for the Macondo well.
In May 2011, MOEX Offshore agreed to pay BP more than $1 billion to settle all claims between the companies.
The federal government's $45 million share of the civil penalties will go toward replenishing the Oil Spill Liability Trust Fund, which covers the cost of cleanup and damage from future spills.
Louisiana's share of the civil penalties is $6.75 million. Alabama, Florida and Mississippi will each get $5 million, while Texas gets $3.25 million.
MOEX issued a statement saying it was "pleased to have resolved these claims." A spokesman declined further comment.
Associated Press writer Cain Burdeau in New Orleans contributed to this report.