BP said Thursday the cost for fixing the 2010 Deepwater Horizon spill will increase $5.2 billion to $61.2 billion.
The British energy company said the second quarter charge would likely be the final payment BP makes on the Gulf of Mexico oil spill to have a “material impact” on its financial position.
BP’s costs are larger than the fines on the banks involved in the 2008 subprime mortgage crisis.
“I know of no other more expensive man-made corporate disaster,” said Daniel Jacobs, a former Department of Justice environmental lawyer. “The number is huge.”
The company’s disclosure came shortly after BP managed to resolve one of the last lawsuits stemming from the spill. It agreed to pay investors $175 million to rectify the spill. That settlement comes after the company agreed to a $20 billion agreement with state and federal governments, which is among the largest penalties in U.S. history.
The penalties have taken their toll on BP, forcing the company to divest more than $40 billion in assets since 2010.
“Today we can estimate all the material liabilities remaining from the incident,” BP Chief Financial Officer Brian Gilvary said. “Importantly, we have a clear plan for managing these costs and it provides our investors with certainty going forward.”
The spill itself has cost the company in the court of public opinion as well, especially among environmentalists and anti-fossil fuel activists.
Columbia University opened an investigation in February to determine whether a small group of activists broke university rules by disrupting an event orchestrated by BP. Seven members of the anti-fossil fuel group Columbia Divest for Climate Justice (CDCJ) attended the BP event expressly for the purpose of reading aloud a slew of statements lambasting the mega oil company for engaging in “fossil fuel industry violence,” as well as torturing “labor activists.”
“BP is here to tell us about our outlook on energy, but they refuse to tell us about our outlook on survival. BP profits from climate change and human rights violations,” CDCJ organizer Iliana Salazar-Dodge told the audience at the time. “BP has blood on its hands. Do you trust them with our futures?”
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