A BP (LON:BP) unit will pay $102 million to settle a lawsuit accusing the company of overcharging California for natural gas, Bloomberg has reported. The news marks a blow for the blue-chip oil major, which recently said that it was expecting about a $1.5-billion charge to its fourth-quarter results due to US President Donald Trump’s tax reform.
BP’s share price has been little changed in today’s session, standing at 533.00p as of 14:37 GMT, flat in percentage terms. The shares are marginally underperforming the broader UK market, with the benchmark FTSE 100 index having climbed into positive territory and currently standing 0.16 percent higher at 7,775.73 points. The oil major’s shares have added more than three percent to their value over the past year, as compared with about a 6.5-percent advance in the Footsie.
Bloomberg reported yesterday that California Attorney General Xavier Becerra had said that BP had agreed to pay $102 million to settle a lawsuit accusing the company of overcharging the Golden State for natural gas. The accord spared the FTSE 100 group from facing a jury trial which was scheduled to start this week in San Francisco.
According to the lawsuit, the FTSE 100 oil major’s overcharges amounted to at least $150 million to $300 million. California alleged that BP systematically billed state and local government facilities at prices exceeding what the company was allowed to charge under its contracts over almost a decade.
BP meanwhile told Bloomberg in an emailed statement that the claims were ‘entirely without merit,’ and that the company had ‘honestly and fairly’ fulfilled its obligations to California.
“BP has agreed to this compromise settlement for an amount well below what the state demanded in its complaint,” according to the statement.