"The agreement in no way affects the ultimate liability of BP or any other entity for natural resource damages or other liabilities, but provides an opportunity to help restoration get started sooner," the US Justice Department said in a statement.

The Justice Department called it a "first step" towards fulfilling BP's obligations to fund the "complete restoration of injured public resources."

A formal damage assessment is expected to take years to complete and will likely be subject to legal wrangling as BP seeks to spread the liability among its well ownership partners and subcontractors.

Earlier, the British energy giant announced a $40-billion lawsuit against rig operator Transocean, which then unveiled a countersuit.

The restoration agreement came a day after the first anniversary of the Deepwater Horizon disaster, which unleashed the biggest maritime oil spill in history.

The money will be used to rebuild damaged coastal marshes, replenish soiled beaches, conserve ocean habitat to help injured wildlife recover and restore barrier islands and wetlands that provide natural protection from storms.

"This milestone agreement will allow us to jump-start restoration projects that will bring Gulf Coast marshes, wetlands, and wildlife habitat back to health after the damage they suffered as a result of the Deepwater Horizon spill," Secretary of the Interior Ken Salazar said in a statement.

Oil-coated dolphin carcasses and sticky tar balls continue to wash up on beaches a year after the explosion which killed 11 workers and sank the Deepwater Horizon rig some 50 miles (80 kilometers) off the coast of Louisiana.

By the time the well was capped 87 days later, 4.9 million barrels (206 million gallons) of oil had gushed out of the runaway well 5,000 feet (1,500 meters) below the surface of the Gulf of Mexico.

Hundreds of miles of fragile coastal wetlands and beaches were contaminated, a third of the Gulf's rich US waters were closed to fishing, and the economic costs have reached into the tens of billions.

"BP believes early restoration will result in identified improvements to wildlife, habitat and related recreational uses in the Gulf, and our voluntary commitment to that process is the best way to get restoration projects moving as soon as possible," said Lamar McKay, chairman and president of BP America.

"Our voluntary agreement to accelerate restoration projects builds upon the cooperative approach BP has taken toward working with Gulf communities and regulators since the accident, and in assessing the potential injury to natural resources."

BP took a $40.9-billion charge in 2010 related to the spill -- including $13.6 billion for the massive spill response -- and warned shareholders that it could not fully estimate its future liabilities.

It is the subject of a potentially criminal federal investigation and could face massive fines and penalties in addition to its legal obligation to restore environmental damage.

The company has also set up a $20-billion trust fund to cover compensation claims from fishermen and others affected by the spill and has so far paid out $3.9 billion to 179,000 claimants.

In addition to the suit against Transocean, BP has also sued oil services giant Halliburton, which was responsible for the well's flawed cement job, and parts manufacturer Cameron, which supplied the faulty blowout preventer.

A presidential commission tasked with investigating the spill blamed the disaster on management failures by BP, Halliburton and Transocean.

US investigators said last month that the well might never have blown if the company's engineers had been consulted about a key test that pointed to defective cementing of the well.

Meanwhile, BP's woes deepened on Thursday when the local tycoons of its Russian joint venture announced plans to sue the British energy giant over its bid to forge an alliance with state firm Rosneft.

earlier related report
A year after BP spill, Obama vows to restore Gulf
New Orleans, Louisiana (AFP) April 20, 2011 - Mourners bowed their heads at vigils Wednesday to mark the first anniversary of the BP Deepwater Horizon disaster, which unleashed the biggest maritime oil spill in history and blackened beaches from Texas to Florida.

President Barack Obama vowed to do "whatever is necessary" to restore the US Gulf Coast and to "hold BP and other responsible parties fully accountable for the damage they've done and the painful losses that they've caused."

Oil-coated dolphin carcasses and sticky tar balls continue to wash up on beaches a year after the April 20, 2010 explosion which killed 11 workers and sank the Deepwater Horizon some 50 miles (80 kilometers) off the coast of Louisiana.

By the time the well was capped 87 days later, 4.9 million barrels (206 million gallons) of oil had gushed out of the runaway well 5,000 feet below the surface of the Gulf of Mexico.

Hundreds of miles of fragile coastal wetlands and beaches were contaminated, a third of the Gulf's rich US waters were closed to fishing, and the economic costs have reached into the tens of billions.

Months of uncertainty caused deep emotional trauma for the fishermen and coastal residents who feared their way of life was being destroyed. More than 120,000 people are waiting on compensation claims inching through a clogged system.

"I was very happy, and to have it ripped away from you, it's like a part of your heart is dead," said shrimper Dee Poche of Lafitte, Louisiana.

The immediate environmental damage appears to be surprisingly limited -- thanks in large part to favorable winds and tides which kept the bulk of the oil from reaching the coast -- but scientists warn it is far too soon to predict what the full impact will be.

"While we've made significant progress, the job isn't done," Obama said in a statement.

Nearly 2,000 workers remain engaged in the recovery effort -- down from a peak of more than 48,000 at the height of the spill -- and the goal is to "ensure that the Gulf Coast recovers stronger than before," Obama said.

The administration has also implemented "aggressive new reforms for offshore oil production in the Gulf so that we can safely and responsibly expand development of our own energy resources," he added.

The spill exposed the industry's shocking lack of preparedness, weak safety culture and dangerously lax government oversight.

"This disaster was almost the inevitable result of years of industry and government complacency and lack of attention to safety," a presidential commission tasked with investigating the spill concluded.

But the Obama administration's solution -- a temporary moratorium until new safety rules could be implemented -- was slammed by residents and politicians for dealing Louisiana a bigger economic blow than the spill.

"When we have other tragedies -- when we have airlines that crash, we don't shut down the airline industry," Louisiana Governor Bobby Jindal said Wednesday as he urged federal regulators to speed up the permitting process and let drilling rigs get back to work.

"The less drilling that happens over here, all that means is more money going overseas to countries that aren't necessarily friendly to us," Jindal said at a press conference in the hard-hit beach town of Grand Isle.

But activists at a candle-light sunrise vigil in New Orleans said the disaster should be a catalyst for moving the country towards greater use of alternative energy sources.

"The only way to protect our communities, our waters and our air from another disaster is to break our addiction to oil and embrace a cleaner, safer energy future for America," said Sierra Club president Robin Mann.

The spill was almost 20 times bigger than the one caused by the 1989 Exxon Valdez tanker disaster and is surpassed only by a 1910 gusher in California and deliberate releases by Iraqi troops during the 1991 Gulf War.

"We are committed to meet our obligations to those affected by this tragedy and we will continue our work to strengthen safety and risk management across BP," chief executive Bob Dudley said in a statement.

"But most of all today, we remember 11 fellow workers and we deeply regret the loss of their lives."

BP took a $40.9 billion loss in 2010 related to the spill, including $13.6 billion for the initial response, and hopes to recover a significant portion of the cost from its well ownership partners and from subcontractors Transocean, which ran the drilling rig, and Halliburton, which was responsible for the well's flawed cement job.

It has set up a $20 billion trust fund to cover compensation claims from fishermen and others affected by the spill, but also faces massive fines and penalties from the US government and will be responsible for repairing the environmental damage.

Transocean, which recently came under heavy fire for awarding executives big safety bonuses, flew the relatives of those who died on the drilling rig out to the site of the disaster in a solemn memorial.

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