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By Andrew Callus and Braden Reddall
Feb 5 (Reuters) - BP Plc has tallied up claims madeby states and local governments on the U.S. Gulf Coast foreconomic and property damages from the Macondo oil spill, andcome up with a figure of $34 billion, which it deems"substantially" overstated.
The company has struggled with political, financial andlegal fallout ever since the April 2010 explosion, which causedthe worst offshore oil spill in U.S. history.
The $34 billion total, provided for disclosure reasons withthe company's financial results on Tuesday, is based on claimsmade last month by Alabama, Mississippi and Florida as well asclaims made by Louisiana and others from local governments, BPsaid.
Citing the Oil Pollution Act (OPA) underpinning the claims,the company said it considers the methods used to calculate themto be "seriously flawed, not supported by the legislation and tosubstantially overstate the claims."
BP Finance Director Brian Gilvary explained that proving aloss of tax revenue by these governments would be especiallydifficult given that BP's response to the 2010 spill led to40,000 people being hired and increased taxes paid as a result.
"It would be a pretty hard case to prove that there wasactually a loss of tax revenue," Gilvary said.
Earlier on Tuesday, BP said that fourth-quarter profit fellone-fifth from a year ago.
An inability to settle state claims would be a complicationfor BP as it tries to avoid a related civil trial due to starton Feb. 25, with separate talks also under way with the federalgovernment on a Clean Water Act liability ranging from $5billion to $21 billion.
BP's top in-house lawyer, Rupert Bondy, said the company hadalready provided a $42.2 billion assessment for all claims, anda total of $37 billion has already been committed throughseparate settlements. Bondy emphasized that BP would litigatethe $34 billion in state and local claims.
Louisiana and Alabama have been prominent in their publicdemands for BP to pay its debt to the Gulf Coast.
Garret Graves, senior coastal adviser to Louisiana GovernorBobby Jindal, called the $34 billion number "extraordinary,"especially because it does not include state claims under theClean Water Act or the Natural Resource Damage Assessmentprocess of the OPA.
"Perhaps this helps BP to realize the size and scope of theproblems they have caused the citizens of the Gulf," Gravessaid, though he cited "bright spots" such as tourism and seafoodsafety agreements BP struck with the states, and BP's "earlyrestoration" agreement for the coast.
"They have continued to try to downplay the significance theoil spill has had on us," he added. "BP hasn't done itself anyfavors in gaining goodwill with anyone in the Gulf. With a fewexceptions early on, they have been incredibly difficult to dealwith and their credibility is subsurface."
A spokeswoman for Alabama Attorney General Luther Strangedid not have an immediate comment.
Transocean Ltd, owner of the rig destroyed in theMacondo disaster, said on Tuesday it was still open tonegotiating any remaining claims against it beyond its $1.4billion federal government settlement agreed a month ago. But the company is also prepared to go to court.
"While litigation is always unpredictable and unpleasant anduncertain, I can guarantee you we are ready to go to trial if wehave to," Chief Executive Steven Newman said at the CreditSuisse Energy Summit in Colorado.
A hearing on Tranoscean's federal criminal settlement is setfor Feb. 14 in New Orleans. BP's criminal settlement, originallyagreed in November, was approved last week.
The civil case, with a trial set for Feb. 25, is In re: OilSpill by the Oil Rig "Deepwater Horizon" in the Gulf of Mexico,on April 20, 2010, No. 10-md-02179, in the U.S. District Court,Eastern District of Louisiana.
