PROPOSED CONSENT DECRE SHEET FACT SHEET PROPOSED CONSENT DECREE WITH BP FOR THE DEEPWATER HORIZON/MACONDO WELL OIL SPILL Background On December 15, 2010 the United States sued BP Exploration and Production Inc. ("BP"), as well as other defendants, for civil penalties under the Clean Water Act and sought a declaration that BP was liable for natural resource damages and response costs under the Oil Pollution Act for this tragic oil spill. Since 2010, the United States has litigated against BP, among other defendants. So far there have been three phases of trial. The Court has ruled on phases I and II, and we are currently awaiting a ruling on phase III, which would determine a penalty amount for BP. BP, the United States, and the five Gulf states have agreed to a settlement resolving claims for federal civil penalties and natural resource damages related to the Deepwater Horizon BP Spill. This settlement is set forth in the proposed Consent Decree. The Department of Justice is seeking public comment on the proposed settlement. Terms of Proposed Consent Decree Penalty Amounts BP must pay $5.5 billion, plus interest, as a civil penalty under the Clean Water Act. (CD Paragraphs 10-14). Under the RESTORE Act, which Congress enacted in 2012 in response to the spill, 80 percent of the penalty is allocated for environmental restoration, economic recovery projects, and tourism and seafood promotion in the five Gulf states (Alabama, Florida, Louisiana, Mississippi, and Texas). Allocation of the Gulf Coast Restoration Trust Fund 35% 30%* 30% FL AL MS LA * 2.5% * 2.5% TX Gulf Coast Ecosystem Impact Based Centers of NOAA Equally Restoration Council for Distribution Excellence RESTORE Distributed ACT to Gulf States Ecosystem Restoration Science *Supplemented by interest generated by the Trust Fund (50% to Gulf Coast Ecosystem Program Restoration Counsel, 25% to Science Program, 25% to Centers of Excellence) In accordance with the Oil Pollution Act, the remaining civil penalties will be paid to the Oil Spill Liability Trust Fund, which is used to support responses to oil spills. Damages BP must pay $8.1 billion in natural resource damages, including $1 billion BP previously committed to pay for early restoration projects. (CD Paragraphs 15-17 and 19). The designated federal and state trustee agencies will use these funds to restore Gulf of Mexico natural resources injured in the spill. The federal and state trustees have agreed in the Consent Decree to an allocation of the $8.1 billion among five different restoration goals and 13 restoration categories designed to meet these goals. These are outlined in Table 1 below. Most of the $8.1 billion is also allocated geographically across the five Gulf states. In addition, BP will pay up to $700 million to address natural resource conditions that are presently unknown but may come to light in the future and to monitor, adapt, supplement or replace earlier restoration projects as needed. This is comprised of $232 million combined with the accrued interest on the $8.1 billion. (CD Paragraph 21). To view the proposed Consent Decree and comment visit http://www.justice.gov/enrd/deepwater-horizon PROPOSED CONSENT DECREE Additional Payments SUMMARY OF PAYMENTS BP must pay $250 million to reimburse the U.S. for costs responding to the spill, lost royalties, and to resolve a False Claims Act investigation. (CD Paragraphs 22-24). Natural Resource BP must also pay $350 million to the governments for natural resource damage assessment costs. Early Restoration BP BP's payments are scheduled over 16 years. (See Sections IV-VI of the Decree). Injunctive Relief The criminal guilty plea that BP entered into regarding the Deepwater Horizon incident imposed a comprehensive set of measures to improve the company’s drilling procedures, safety protocols, and corporate ethics. Additional measures were imposed in an Administrative Agreement with EPA to resolve potential suspension and debarment claims. As part of the Decree, BP acknowledges that it is in compliance with these requirements. BP will post reports documenting its progress on a publicly available website, to increase transparency so that the public can better understand its performance. (CD Paragraphs 34-38). Compliance Assurance The Consent Decree contains a number of terms to assure payment. Guarantees. Although the Consent Decree is with BP Exploration & Production, Inc., the company that owned the Macondo Well, BP's American and British parent companies—BP Corporation North America Inc. and BP p.l.c—are guaranteeing that all payments will be made. (CD Paragraph 32 and Appendices 8 and 9). Acceleration. Should BP p.l.c. file bankruptcy, become insolvent, or change ownership, the governments can require BP to make all payments immediately. (CD Paragraphs 9, 30 and 31). Stipulated Penalties. If BP fails to meet the deadline for any payment or fails to comply with injunctive relief, the governments may seek additional stipulated penalties as a sanction. (CD Paragraphs 44-45). 5BY %FEVDUJPOT In compliance with federal tax law, BP may not take a tax deduction for any portion of the civil penalty. (CD Paragraph 14). CWA Civil Penalty Damages previously committed (partially paid). NRD Assessment Costs (States and U.S.) Unknown Injury and Adaptive Management $5.5 billion $7.1 billion $1 billion $350 million Up to $700 million False Claims Act; Royalties on oil; Response and other $250 million costs State and Local Economic Claims Up to $5.9 billion (Separate Agreement) TOTAL $20.8 billion Related, -Parallel State Agreement In connection with the settlement described in the Consent Decree, BP also has reached a separate agreement with the Gulf states resolving economic damages claims of state and local governments. Under this agreement, BP will pay $4.9 billion, in total, to the five Gulf states, and up to $1 billion to local governments that presented such claims. The U.S. is not a party to these economic damages agreements. Therefore, the U.S. is not taking comment on these agreements. However, this Consent Decree is conditioned on the agreement with the Gulf states also becoming final. (CD Paragraph 75). Public Comment The Consent Decree was lodged with the Court on October 5, 2015. The governments encourage — and will accept — comments on the Decree on or before December 4, 2015. After considering the comments, the governments will determine whether to seek Court approval of the Consent Decree. To view the proposed Consent Decree and comment visit http://www.justice.gov/enrd/deepwater-horizon PROPOSED CONSENT DECREE RESTORATION GOALS AND CATEGORIES Restoration Goals and Restoration Types 1. Restore and Conserve Habitat Wetlands, Coastal and Nearshore Habitats Unknown Conditions Region-wide Open Ocean Restoration in Restoration in Florida Alabama Restoration in Louisiana Restoration in Restoration in Texas Mississippi 100,000,000 Total Allocation 4,234,562,700 65,000,000 5,000,000 4,009,062,700 55,500,000 Habitat projects on Federally Managed Lands 3,000,000 17,500,000 50,000,000 5,000,000 75,500,000 Early Restoration (thru phase IV) 2. Restore Water Quality Nutrient reduction (nonpoint source) 28,110,000 15,629,367 259,625,700 80,000,000 383,365,067 5,000,000 35,000,000 20,000,000 27,500,000 Water Quality (e.g. stormwater treatments, hydrologic restoration, reduction of sedimentation, etc.) 22,500,000 300,000,000 110,000,000 300,000,000 3. Replenish and Protect Living Coastal and Marine Resources Fish and Water Column Invertebrates Early Restoration Fish 380,000,000 20,000,000 380,000,000 20,000,000 Sturgeon 15,000,000 15,000,000 Sea Turtles Early Restoration Turtles 60,000,000 29,256,165 55,000,000 5,500,000 20,000,000 SAV 10,000,000 5,000,000 7,500,000 19,965,000 22,000,000 22,000,000 Marine Mammals 19,000,000 55,000,000 5,000,000 5,000,000 50,000,000 10,000,000 Birds Early Restoration Birds 70,400,000 1,823,100 70,000,000 30,000,000 145,000 40,000,000 2,835,000 148,500,000 71,937,300 25,000,000 Mesophotic Reefs & Deep Benthic Habitats 144,000,000 20,000,000 20,603,770 64,372,413 22,500,000 20,000,000 5,370,596 26,000,000 14,874,300 20,000,000 13,600,000 22,397,916 25,000,000 85,505,305 63,274,513 120,543,167 38,000,000 22,000,000 5,000,000 18,957,000 18,582,688 131,274,513.00 287,986,076 520,000,000 65,000,000 200,000,000 10,000,000 10,000,000 225,000,000 7,500,000 2,500,000 Administrative Oversight and Comprehensive Planning 40,000,000 150,000,000 20,000,000 20,000,000 33,000,000 22,500,000 4,000,000 TOTAL NRD FUNDING 700,000,000 $700,000,000 162,872,413 37,173,896 10,000,000 3,329,000 Early Restoration of Recreational Loss 5. Monitoring, Adaptive Management, Administrative Oversight Monitoring and Adaptive Management Adaptive Management NRD Payment for Unknown Conditions 403,900,000 97,344,170 273,300,000 273,300,000 Oysters Early Restoration Oyster 4. Provide and Enhance Recreational Opportunities 163,000,000 49,221,165 289,500,000 700,000,000 $349,851,678 $1,240,697,916 $295,589,305 $680,152,643 $5,000,000,000 $295,557,000 To view the proposed Consent Decree and comment visit http://www.justice.gov/enrd/deepwater-horizon $238,151,458 8,800,000,000