Alabama Will Likely Receive About $2.3 Billion as Part of BP Settlement

Deepwater 2Alabama will reportedly be receiving some $2.3 billion as part of a settlement with BP after the Gulf Coast states and the federal government hammered out the tentative deal with the oil company to compensate for the Deepwater Horizon oil spill which occurred in 2010.

All-in-all BP would shell out more than $18 billion under that agreement.

A U.S. subsidiary of BP – BP Exploration & Production will pay a minimum of $7.1 billion to the states of Alabama, Mississippi, Louisiana, Florida and Texas – for damage to the natural resources in the affected areas – $5.5 billion in penalties for violating the Clean Water Act – $4.9 billion to the states to compensate for harm to their economies, and up to $1 billion to more than 400 local governments.

Alabama Governor Robert  BentleyAlabama Governor Robert Bentley said Alabama will receive $1.3 billion for environmental restoration projects, with another $1 billion being paid to the state over the next 18 years; that money, averaging out to roughly $55 million a year – would go to the Alabama General Fund Budget.

Bentley said the settlement would not solve the problems of the General Fund, which faces a shortfall of more than $200 million in the fiscal year which begins October 1st; he says he still plans to call a session to pass a budget – something which the governor and lawmakers were unable to come to an agreement on earlier in the year.

Bentley added that the settlement is an “agreement in principle,” and court approval would have to be granted for it to become “official”.

Those watching the case say it appears likely BP will indeed honor that agreement.

(The Anniston Star/www.annistonstar.com/The Associated Press)

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