BP Reaches $250 Million Settlement with Blowout Preventer Maker Cameron International

BP officials announced Friday they have reached a $250 million settlement with Cameron International Corp., putting to bed the claims between the two companies involved in the Deepwater Horizon oil spill.

Cameron, the designer and manufacturer of the rig's blowout preventer, will pay BP $250 million, which BP will then place in its $20 billion trust the company put aside to pay for compensation and environmental damages, according to BP's website.

Today's settlement allows BP and Cameron to put our legal issues behind us and move forward to improve safety in the drilling industry, said Bob Dudley, BP group chief executive. Cameron is the fourth company to settle with BP and contribute to economic and environmental restoration efforts in the Gulf. Unfortunately, other companies persist in refusing to accept responsibility for their roles in the accident and for contributing to restoration efforts.

In April of 2010, an explosion on the Deepwater Horizon killed 11 workers and caused the worst environmental disaster in American history. Cameron's blowout preventer should have stopped the flow of oil from erupting from the underwater well head, but it failed.

Friday's settlement is the fourth involving companies that in some shape or form worked on the Deepwater Horizon with BP, or supplied it with equipment. Previous settlements involved MOEX and Anadarko, BP's partners in the Macondo well, and Weatherford, the company that made the float collar used at the well.

Cameron said the agreement will indemnify them for current and future compensatory claims made against the Houston-based company, according to a company statement.

This agreement with BP is the right action, as it removes uncertainty facing Cameron in the litigation associated with the Deepwater Horizon event, Cameron chairman and CEO Jack Moore said. This eliminates all significant exposure to historical and future claims related to this incident.

The agreement, however, does not provide indemnification against fines or other penalties, but Moore said he does not think future non-compensatory claims are of any risk to his company.

Both companies agreed the Macondo Spill was caused by several complex interconnected causes involving several parties, and they have put their claims aside so as to better reform the oil industry and improve safety.

To date, BP officials say the company paid $7.5 billion in compensation.