Oil giant BP has agreed to pay investors $175 million to settle claims that it misled them both during and after the massive 2010 Deepwater Horizon oil spill in the Gulf of Mexico.
The Deepwater Horizon spill is considered the largest manmade disaster in the oil industry’s history, which claimed the lives of nearly a dozen workers, and sent tens of thousands of gallons of oil spilling continuously into the gulf for nearly three months.
BP investors accused the company of downplaying the rate of the spill to improve its stock price, and sued the company for $2.5 billion for misleading shareholders.
The company had said only a few thousand barrels of oil had leaked per day from the offshore well during the 87-day spill. But independent studies later estimated that as much as 62,000 barrels of oil were released each day during the spill. The independent study caused BP’s stock to plummet.
The shareholders’ suit alleged the company was distributing misinformation about the extent of the spill to keep stock prices higher. A federal judge had ruled that investors who bought shares between 2007 and 2010 were eligible to sue.
The settlement agreement, which came on Friday, must still be approved by a federal judge.
