Federal investigators determined a cascading series of failures by BP, Transocean and Halliburton lead to a gas explosion that sunk the Deepwater Horizon oil rig, killing 11 workers in April 2010 and leading to the worst oil spill in U.S. history.
BP in a lawsuit filed in April said the blowout preventer used at the Macondo well in the Gulf of Mexico was flawed in design.
Cameron International Corp., which designed and manufactured the device, and BP concluded a $250 million settlement. BP said it would apply the settlement to the $20 billion trust fund set up to pay off claims and cleanup costs associated with the Deepwater Horizon accident.
"Today's settlement allows BP and Cameron to put our legal issues behind us and move forward to improve safety in the drilling industry," BP Chief Executive Officer Bob Dudley said in a statement.
Transocean, Halliburton and BP are locked in corporate battles over which company bears ultimate responsibility for the Gulf of Mexico oil spill. The settlement with Cameron is the fourth for BP, which announced this week it was moving from the cleanup to the restoration phase in the gulf.
An October report listed seven violations for BP and four each for Transocean and Halliburton.
The U.S. Bureau of Safety and Environmental Enforcement last week said it notified BP of five additional regulatory violations stemming from operations at the Macondo well.