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BP. Bp Plc

525.60
2.50 (0.48%)
24 Apr 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Bp Plc LSE:BP. London Ordinary Share GB0007980591 $0.25
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  2.50 0.48% 525.60 526.10 526.20 531.40 525.30 529.20 60,159,643 16:35:04
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Petroleum Refining 211.6B 15.24B 0.8934 5.89 89.76B

BP Faces Up to $13.7 Billion in Fines in Deepwater Gulf Spill Case -- Update

16/01/2015 12:24am

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By Daniel Gilbert 

A federal judge ruled Thursday that BP PLC is liable for spilling just over 3 million barrels of crude into the Gulf of Mexico in the 2010 Deepwater Horizon disaster, 24% less than federal prosecutors had claimed.

The ruling means that BP faces a maximum penalty of $13.7 billion under the U.S. Clean Water Act, down from the $18 billion sought by the Justice Department.

The decision by Judge Carl Barbier surprised analysts following the case, coming days before BP is set to appear in his court for a related trial on how much it should pay for each barrel spilled. That tranche of the complex case, which begins on Tuesday, will determine the total fine under the Clean Water Act.

Thursday's decision narrows the range of penalties BP could face, which could make a settlement more feasible, said Tom Claps, a legal analyst for Susquehanna Financial Group. But the judge is "not giving the parties a lot of time to sit down" to negotiate, he added.

Both BP and the Justice Department said they are reviewing the ruling. BP has argued that its efforts to control and clean up the oil spill should result in a penalty far below the maximum.

The Deepwater Horizon rig exploded on April 20, 2010, leaving 11 crewmembers dead and unleashing the largest offshore oil spill in U.S. history.

In September, Judge Barbier ruled that BP acted recklessly leading up to the rig explosion and oil spill, exposing the company to a maximum pollution penalty of $4,300 a barrel. BP has asked that the per-barrel fine be capped at $3,000.

The ruling on Thursday concluded that 4 million barrels of oil spilled into the Gulf, and that after taking into account the crude that was skimmed off the surface, BP is liable for a fine on 3.19 million barrels.

The company wasn't "grossly negligent, willful, or wanton" in its efforts to control the spill, Judge Barbier wrote.

BP had argued it should be liable for 2.45 million barrels, while federal prosecutors claimed a fine should be based on 4.2 million barrels.

BP has set aside $3.5 billion to pay for penalties under the Clean Water Act. It has already spent $43 billion on spill-related costs, including criminal and civil settlements and $14 billion for the Gulf cleanup.

The ruling also has implications for Anadarko Petroleum Corp., which owned 25% of the well drilled by the Deepwater Horizon rig.

Anadarko's maximum liability had been $4.6 billion, based on the government's estimate of how much crude spilled. After Thursday's ruling, the company faces up to $3.5 billion.

"Today's ruling regarding the volume doesn't change the Court's previous findings that we had no direct operational involvement," an Anadarko spokesman said.

Anadarko contends it should pay no penalty under the Clean Water Act. It has set aside $90 million for a potential fine.

Write to Daniel Gilbert at daniel.gilbert@wsj.com

Access Investor Kit for Anadarko Petroleum Corp.

Visit http://www.companyspotlight.com/partner?cp_code=P479&isin=US0325111070

Subscribe to WSJ: http://online.wsj.com?mod=djnwires


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