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BP to take a charge of around US$1.7bn in fourth quarter for 2010 Deepwater Horizon spill

Last updated: 11:10 16 Jan 2018 GMT, First published: 07:43 16 Jan 2018 GMT

Deepwater Horizon
Brian Gilvary, BP's chief financial officer, said: “With the claims facility's work very nearly done, we now have better visibility into the remaining liability"

BP plc (LON:BP.) said it expects to take around a US$1.7bn post-tax non-operating charge of in its fourth quarter results as part of the settlement of the 2010 Deepwater Horizon spill in the Gulf of Mexico.

In a statement, the FTSE 100 listed oil giant said the Court Supervised Settlement Program (CSSP) set up in the wake of the deadly disaster was now winding down.

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The group said cash payments related to Deepwater Horizon in 2018 are now anticipated to be around US$3bn, as compared to the company's third-quarter estimate of just over US$2bn.

Brian Gilvary, BP's chief financial officer, said: “With the claims facility's work very nearly done, we now have better visibility into the remaining liability.

"The charge we are taking as a result is fully manageable within our existing financial framework, especially now that we have the company back into balance at US$50 per barrel."

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BP said the charge results primarily from significantly higher claims determinations issued by the CSSP in the fourth quarter and the continuing effect of the US Fifth Circuit's adverse May 2017 ruling on the matching of revenues with expenses when evaluating claims.

In late morning trading, BP shares were down 1.9%, or 10.10p to 522.60p.

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