Published: Tue, January 16, 2018
Business | By Max Garcia

BP to take $1.7bn charge on Deepwater Horizon spill

BP to take $1.7bn charge on Deepwater Horizon spill

On January 16, British energy giant BP said it expects to take a post-tax non-operating charge of around $1.7 billion in its fourth quarter 2017 results for the remaining Business Economic Loss (BEL) and other claims associated with the Court Supervised Settlement Program (CSSP) established as part of the Deepwater Horizon (DWH) class action settlement.

"With the claims facility's work very almost done, we now have better visibility into the remaining liability", Brian Gilvary, BP's chief financial officer, said in a news release. An explosion at the offshore platform on April 20, 2010 killed 11 men, and the subsequent leak released an estimated 172 million gallons of petroleum into the Gulf of Mexico.

The charge is fully manageable within BP's existing financial framework, the company said. Earlier in January, the company announced that it is accounting expenses of 1.5 billion United States dollars due to changes in U.S. tax law.

The Deepwater Horizon oil spill in April 2010 killed 11 workers and gushed almost 5m barrels of oil into the Gulf of Mexico.

A spokeswoman for the group said hundreds of outstanding claims have yet to be closed, raising the prospect of further charges. For its statement for the fourth quarter, due February 6, the company said it expects a $1.5 billion one-off non-cash charge from the US corporate income tax reduction.

Total cash payments made this year related to the disaster are expected to be around $3bn, $1bn more than the company's previous estimate of £2bn. Spending during the third quarter was up 14 percent from the same period to $4 billion.

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