London: BP has launched its promised appeal against 'fictitious' and 'absurd' oil spill compensation payouts and asked a judge to temporarily halt to those made on a so-called business economic loss basis.
In a New Orleans court filing, BP gave examples of businesses in industries far from the spill and unconnected with the coastline that enjoyed strengthened earnings in the spill year of 2010 and yet had received millions in spill compensation.
The British oil and gas group, which has already sold a substantial part of its business to pay reparations and fines for the disaster, said it could be 'irreparably harmed' by the payouts without relief from the court, because they could cost it 'billions' more than it budgeted for when it agreed to a settlement.
BP was appealing a March 5 ruling, which upheld the way the compensation was being paid to business claimants wanting recompense. The ruling, by the same US district judge Carl Barbier who presides over BP's ongoing trial on separate civil charges, reopened a part of the saga that appeared to have been settled almost a year ago when BP agreed terms on economic, property and medical compensation for more than 100,000 individuals and businesses who had filed a class action suit.
At the time of the settlement, BP estimated the bill would be $7.8 billion — already making it one of the biggest settlements of its kind in US history.
The actual amount is uncapped, and dependent on decisions made by Patrick Juneau, a lawyer from Louisiana who administers the payments under a complex set of rules set out by the agreement.
As the payments started to flow out, BP realised the funds it had set aside would be insufficient. At first, it added more, reaching $8.5 billion in 2012.