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Plaintiffs have agreed to a $330 million settlement with Murphy Oil over damages from a massive oil spill considered the worst environmental disaster stemming from Hurricane Katrina.
A storage tank at the company's Meraux, Louisiana refinery was pushed off its base by Katrina's storm surge, pouring more than one million barrels of oil into the surrounding community.
The settlement was announced Monday by lawyers for Murphy Oil, but must still be approved by the U.S. District Court for the Eastern District of Louisiana. A hearing on the settlement has been scheduled for Oct. 10.
The parties' settlement proposal, negotiated less than a year after the filed cases were consolidated, potentially would be one of the earliest resolutions ever experienced in a Louisiana class action of this nature.
It would conclude some 6,200 claims, with total expenditures and settlement benefits paid by Murphy Oil and its insurers estimated at $330 million. The figure includes $80 million already paid to settle some 2,700 claims. Some $160 million is expected to purchase homes and property in the neighborhood closest to the refinery and to reimburse property owners for damages, as well as to compensate victims for mental anguish and inconvenience associated with the spill.
Under the settlement proposal, Murphy Oil will pay at least $90 million for a comprehensive cleanup of the property impacted by the oil spill.
Federal and state regulators overseeing the company's remediation already have devised a clean-up plan, which now would proceed with court review as part of the settlement.
Attorneys for both the plaintiffs and Murphy Oil expressed confidence that the process of approval and disbursement will be expedited, given the circumstances in the affected area.
The specific terms and provisions of the settlement are expected to be published in a formal notice in the next 7-10 days.