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Published: Friday, 3/9/2012

GUEST EDITORIAL

Settlement for the Gulf

The proposed multibillion-dollar settlement between BP and people and businesses hurt by the 2010 oil spill in the Gulf of Mexico is welcome. If a federal judge grants final approval, it could spare both plaintiffs and the company a lengthy legal battle with uncertain outcomes.

It is also further evidence that BP is willing to pay serious money to atone for its errors. Now it needs to show a similar willingness to meet its obligations in pending suits that are aimed at assessing civil and possibly criminal penalties for environmental damages.

Under an agreement with the Obama Administration, BP put $20 billion in an escrow fund to pay shrimpers, motel owners, and hundreds of thousands of others whose livelihoods were damaged by the spill. Kenneth Feinberg, who administered the fund for the past 18 months, has awarded $6.1 billion to 225,000 claimants.

Under the settlement, the court would take over for Mr. Feinberg. BP estimates that it will pay another $7.8 billion to more than 100,000 additional claimants.

Claimants will still be able to opt out of the scheme and sue BP separately in court. But as before, the hope is to get people to settle, not litigate.

Next are federal environmental claims. BP is liable for natural-resource damages and penalties under the Clean Water Act. They could cost the company $1,100 for each of the 4.9 million barrels of oil it spilled and $4,300 a barrel, or more than $20 billion altogether, if the Justice Department can prove gross negligence.

The department must seek the best deal it can get from BP, brandishing the possibility of a long, nasty trial and a conviction for gross negligence. BP appears eager to put this disaster behind it. The Justice Department needs to push hard.

Congress must ensure that this money is used to carry out a broad restoration of the gulf's fragile ecosystem: the wetlands and barrier islands that had been dramatically weakened long before the spill by miles of oil and gas pipelines, misguided levee building along the Mississippi River, and Hurricane Katrina.

Unless Congress directs the penalties to restoration, money will flow to the federal Treasury and disappear in the maw.

-- New York Times



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