By TOM FOWLER
A federal judge said he is likely to give preliminary approval to BP PLC's proposed multibillion-dollar settlement with Gulf Coast residents and businesses harmed by the 2010 Deepwater Horizon oil spill.
Judge Carl Barbier said in a hearing in New Orleans Wednesday he would issue a formal decision on the proposed settlement in the coming days, according to attorneys who attended the hearing. The deal was detailed for the first time a week earlier in more than 2,000 pages of court documents.
The proposed settlement includes $2.3 billion in payments to the seafood industry, $105 million to start a program to improve medical care in coastal communities and a $57 million fund to promote tourism in the Gulf of Mexico region. The settlement, which includes thousands of claimants, also covers losses by businesses and individuals and extensively covers long-term health care for spill-cleanup workers.
The settlement doesn't put a cap on the payments, but BP estimates the deal will cost it about $7.8 billion. Final approval could take until year-end, but a preliminary approval by the judge, which could come within days, would allow for some benefit payments and about $75 million in legal fees.
As much as $600 million in legal fees are included in the settlement.
A number of parties are objecting to the plan, including the state of Florida, shrimp processors and Halliburton Co., which worked on the oil well that blew out two years ago, unleashing the worst offshore oil spill in U.S. history.
In a filing with the court, the American Shrimp Processors Association said the way damage payments are calculated would shortchange some of its members. Florida has said the settlement appears to provide compensation only to businesses in the Panhandle region and not to those in other parts of the state that face the Gulf.
Halliburton, the company that helped build the failed well, said this week it hadn't had enough time to review the settlement document.
The company, which is sparring in court with BP over liability for the cleanup costs, also objected to BP's plan to let the plaintiffs try to collect what BP says Halliburton and rig owner Transocean Ltd. RIG -1.85% owe.
The objections to the settlement are unlikely to derail the deal, said Blaine LeCesne, a law professor at Loyola University in New Orleans who specializes in torts. "It would be unusual not to have dissension in a case of this magnitude, which is perhaps one of the largest and most complex class actions ever," Mr. LeCesne said.
When it was announced in early March, Bob Dudley, BP Group's chief executive, said the settlement "represents significant progress toward resolving issues" from the 2010 accident.