Cameron to Pay BP $250 Million in Gulf Oil Spill Settlement
Cameron International Corp. (CAM), the maker of the blowout preventer on BP Plc’s Macondo well that caused the worst offshore U.S. oil spill, will pay $250 million to settle all claims in the accident.
BP will fully indemnify Cameron against all damage claims, though not for fines or penalties, the companies said in separate statements today. London-based BP will apply the money to the $20 billion fund for spill victims that it set up last year, the company said.
Cameron, based in Houston, is the fourth company to reach a settlement with BP over the spill. Cement contractor Halliburton Co. (HAL) and Transocean Ltd. (RIG), owner of the Deepwater Horizon rig that burned and sank, have yet to agree on a payout ahead of the Feb. 27 New Orleans trial that will determine liability for the disaster.
“Today’s settlement allows BP and Cameron to put our legal issues behind us and move forward to improve safety in the drilling industry,” BP Chief Executive Officer Bob Dudley said in a statement.
Cameron climbed 6 percent to $47.55 at the close in New York. BP fell less than 1 percent in London to close at 446.65 pence.
The Macondo accident killed 11 workers and triggered a spill that the government says gushed almost 5 million barrels of oil into the Gulf of Mexico. It led to hundreds of lawsuits against BP and its partners and contractors, including multiple claims brought by vessel captains, residents and others exposed to chemicals and oil during the cleanup.
“This agreement with BP is the right action, as it removes uncertainty facing Cameron in the litigation associated with the Deepwater Horizon event,” Cameron CEO Jack Moore said in the statement. Cameron expects insurers to fund at least $170 million of the settlement and it will take a charge for the rest in the fourth quarter.
BP said it has so far paid out about $7.5 billion to individuals, businesses and government entities for damages.