Oil giant BP is facing more financial woe over its Gulf of Mexico oil spill as the deadline for people to make compensation claims against the firm looks set to be extended.
The last date for claims – part of the oil company’s settlement last year with individual and business claimants – was due to be April next year, but last night it emerged the deadline could be extended for a further six months due to ongoing legal rows.
Last night, analysts said the news could further cut the UK firm’s share price.
The 2010 Deepwater Horizon rig explosion killed 11 workers.
The mile-deep Macondo oil well then poured more than 4million barrels of crude into the Gulf of Mexico, fouling coastlines from Texas to Florida.
The terms of the 1,033 page settlement, signed last year by BP and the Plaintiff’s Steering Committee (PSC), show the most widely reported deadline, April 22, 2014 was not a fixed date by which claims must be made.
It is in fact one of two possible deadlines; the later of which will apply.
The other, now more realistic one, is set as six months after an “effective date”, an as yet unknown day by which all legal appeals about the settlement’s validity must have been resolved.
Since the settlement was signed, groups of rebel claimants have filed legal briefs against it. BP has also appealed against the way the settlement is being interpreted.
Lawyers say there is almost no chance these issues will be resolved by October 22, two months from now, six months from April 22, and therefore the last date on which April 22 can be the applicable deadline.
Analysts say the date was always potentially moveable, but like the open- ended nature of its cost that hit home earlier this year, the indefinite extendibility may not have been fully appreciated by long suffering investors.
Neill Morton, an analyst at Investec in London added: “The prospect of the claims lasting for longer than is widely expected is not helpful.”
BP Chief Executive Bob Dudley told reporters on July 30 the deadline would probably move to a later date. BP declined to comment for this story.
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