WASHINGTON (dpa-AFX) - Oil and natural gas producer Anadarko Petroleum Corp.'s (APC) agreement to pay $5.15 billion to resolve all claims against its wholly-owned subsidiary Kerr-McGee Corp. has received approval from a federal judge.
It was on April 4 that Anadarko announced the $5.15 billion settlement deal with plaintiffs and the U.S. government to resolve all claims against Kerr-McGee Corp., for alleged actions by Kerr-McGee prior to its acquisition by Anadarko in 2006.
The U.S. government and the plaintiffs were seeking damages from Tronox, Inc. (TROX), which was a company created in 2005 through a spin-off of the polluting chemicals operations of Kerr-McGee.
Anadarko acquired Kerr-McGee in 2006 in a $18 billion deal and Tronox filed for Chapter 11 bankruptcy protection in January 2009. Tronox used bankruptcy protection to shed the environmental liabilities, and emerged from bankruptcy in February 2011.
As part of the bankruptcy proceedings, Tronox, along with the U.S. Government, filed suit against Kerr-McGee for its fraudulent transfer of billions of dollars of pre-existing environmental and tort liabilities. Kerr-McGee was alleged to have acted with intent to delay and hinder creditors of Tronox, when it was spun off.
The settlement will see Anadarko paying a total of $5.15 billion, which includes a principal sum of about $3.98 billion plus a 6 percent interest on the sum from May 2009, the date when the complaint was filed.
The settlement, which resolved a long-running lawsuit, was billed as the largest ever in the U.S after the $4 billion settlement reached by BP Plc. (BP) in 2012 to resolve claims over the 2010 Deepwater Horizon disaster that led to a massive oil spill.
However, the settlement amount was well below the $25 billion originally claimed by the US government and plaintiffs, and also below the $14.5 billion proposed in a court ruling by U.S. Bankruptcy Judge Allan Gropper in mid-December.
Opponents of the settlement can still appeal.
APC closed down 2.1 percent on Monday at $92.34.
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