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BP hit with $4.5 billion fine for Gulf oil spill

Company accepts criminal responsibility for 2010 disaster

A NASA satellite captures an image of a swirling oil slick from BP’s failed Deepwater Horizon drilling rig in the Gulf of Mexico.

By Summit Voice

FRISCO — After spending more than $14 billion on the response to the 2010 Deepwater Horizon disaster, BP will pay another $4.5 billion in penalties under a settlement with the U.S. Department of Justice, the biggest fine ever levied by the department.

Federal officials said they will also pursue gross negligence charges under the Clean Water Act, which could result in up to $20 billion in additional fines, ranging up to $4,300 per barrel of spilled oil.

The explosion killed 11 workers on the drilling rig in the Gulf of Mexico and sent millions of gallons of crude oil spewing into the water, damaging fisheries, smearing beaches and wetlands and squelching tourism in the region for months. Followup studies have shown that oil remnants may affect Gulf ecosystems for years to come.

Under the settlement, BP accepted criminal responsibility for the disaster and will plead guilty to 11 felony counts of “seaman’s manslaughter” for the deaths on the oil rig. In a statement, the company acknowledged that its workers were negligent.

BP also said it will plead guilty to one felony count of obstruction of Congress for lying about the rate of oil spill from the failed well. The federal government also announced felony charges against three former BP employees for failing to conduct proper safety tests.

BP will also plead guilty to several misdemeanor counts under the Clean Water Act and the Migratory Bird Treaty Act, and pay $2.394 billion to the National Fish & Wildlife Foundation $350 million to the National Academy of Sciences over five years.

The company also agreed to strengthen its safety and testing procedures for all its offshore drilling operations.

From the BP statement on the settlement:

“Pursuant to the terms of the plea agreement, BP has also agreed to take additional actions, enforceable by the court, to further enhance the safety of drilling operations in the Gulf of Mexico. These requirements relate to BP’s risk management processes, such as third-party auditing and verification, training, and well control equipment and processes such as blowout preventers and cementing. In addition, BP has agreed to several initiatives with academia and regulators to develop new technologies related to deepwater drilling safety …

“BP will continue to vigorously defend itself against all remaining civil claims and to contest allegations of gross negligence in those cases. The remaining claims include: federal civil claims, including those arising under the Clean Water Act; federal and state Natural Resource Damages claims; private civil claims pending in MDL 2179 that were not covered by the settlement with the Plaintiffs’ Steering Committee (PSC); private securities claims pending in MDL 2185; state economic loss claims; and miscellaneous private civil claims pending in other federal and state courts. BP believes that today’s agreement is consistent with its legal position that it was not grossly negligent. All the pleas related to the accident itself are based on no more than negligent conduct.”

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