BP has announced a settlement with the Plaintiff's Steering Committee that it says will resolve a number of economic loss and medical claims awsuits stemming from the Deepwater Horizon accident and oil spill.

The $7.8 billion cost of the proposed settlement will be paid from a $20 billion trust the company has established. BP says the settlement includes $2.3 billion for economic loss claims related to the Gulf seafood industry.

The Trust was established to cover costs related to business claims, state and local government claims, state and local response costs and natural resource damages

"It is not possible at this time to determine whether the $20 billion Trust will be sufficient to satisfy all of these claims as well as those under the proposed settlement," according to a statement from BP. "Should the Trust not be sufficient, payments under the proposed settlement would be made by BP directly."

The settlement means that Gulf Coast residents who develop illnesses related to exposure will be able to apply to the fund for compensation -- but they'll have to prove that their health problems were caused by the oil or the chemical dispersants used in the clean-up.

Despite the agreement, the company remains a target for litigation, and may face billions in Department of Justice claims under the Clean Water Act and the Oil Pollution Act.

The settlement still has to be approved in federal court.