BP Trial on Hold for Settlement Talks

First appeared in Yahoo! News

BP Plc has delayed by one week the start of a massive trial to decide who should pay for the 2010 Gulf of Mexico oil spill, to allow more time to cut a deal with tens of thousands of businesses and individuals affected by the disaster.

In a statement on Sunday, BP said the start date for the trial in New Orleans federal court has been pushed back to March 5 from February 27.

The Plaintiffs' Steering Committee (PSC) represents fishermen, hoteliers, condominium owners and other local businesses and individuals who say their livelihoods were damaged by the April 20, 2010 explosion of the Deepwater Horizon drilling rig and subsequent oil spill.

Eleven people died, and 4.9 million barrels of oil spewed from the mile-deep Macondo oil well, in by far the worst offshore U.S. oil spill.

"BP and the PSC are working to reach agreement to fairly compensate people and businesses affected by the Deepwater Horizon accident and oil spill," BP said in a statement.

A BP spokeswoman declined to comment further on the talks. Lawyers for BP and the steering committee did not immediately respond to requests for comment. A spokeswoman for the U.S. Department of Justice, which is also suing BP, declined to comment.

In an order dated Sunday, Barbier said the adjournment was appropriate "for reasons of judicial efficiency and to allow the parties to make further progress in their settlement discussions."

A BP settlement with the businesses would remove a significant portion of the complex litigation, the trial of which was expected to take nearly a year.

But the U.S. government has sued BP and others for Clean Water Act and other federal violations, which could result in fines totaling tens of billions of dollars. Gulf states are also seeking compensation for their losses.

Apart from BP, which owned 65 percent of the Macondo well, the main defendants are Vernier, Switzerland-based Transocean Ltd, which owned the Deepwater Horizon rig, and Houston-based Halliburton Co, which provided cementing services for the well. They are also suing each other. Several other companies are also involved in the trial.

BP said earlier this month it had set aside $6.1 billion to cover claims by businesses. Lawyers for those plaintiffs said the amount was too low to cover their clients' actual losses, and that BP should also award punitive damages, which the oil company believes are not warranted.

BP has accepted responsibility for the disaster. It has projected its total legal and cleanup costs at roughly $43 billion.

Chief Executive Robert Dudley has said BP is willing to settle for reasonable terms, and many industry analysts and experts say a quick settlement is in the London-based oil company's interest.

The case is In re: Oil Spill by the Oil Rig "Deepwater Horizon" in the Gulf of Mexico, on April 20, 2010, U.S. District Court, Eastern District of Louisiana, No. 10-md-02179.