THE legal fallout from the worst offshore oil spill in US history is scheduled to resume in federal court this week in New Orleans, with a civil trial to determine the charges against BP in the aftermath of the oil well explosion in the Gulf of Mexico.
BP, one of the world’s major oil and gas companies, faces up to $13.7 billion in fines for violating the federal Clean Water Act, the largest such penalty ever sought by the government. The previous record was $1 billion paid by Transocean Ltd. in a 2013 settlement from the same disaster, a drilling rig explosion in the Gulf of Mexico in April 2010, which killed 11 people.
Following the Deepwater Horizon oil well’s blast, crude oil poured into the gulf for months, fouling beaches and harming wetlands and natural wildlife all the way from Texas to Florida. Businesses in the gulf also incurred large losses.
US District Judge Carl Barbier ruled in September 2014 that BP bore the bulk of the blame for the disaster. Now, he will evaluate the case to determine how much the company will be fined or violating the Clean Water Act.
Last week, Barbier also ruled that 3.19 million barrels of oil poured out of the Macondo well, about 41 miles off the coast of Louisiana. The oil gushed from the well for nearly three months, until it was capped on July 15. It was declared sealed a few months later.
The amount of oil that came from the well was sharply debated, and critical to BP, and it is the basis for their fines and penalties. At a maximum of $4,300 per barrel, BP is liable for up to $13.7 billion in fines.
The government also sought an $18 billion fine, based on a larger estimated oil flow.
Barbier previously ruled that the British company had acted with “gross negligence and willful misconduct” in its actions leading up to the April 2010 explosion, making it liable for the maximum fine.
BP argued that the fine should be capped at $3,000 per barrel. The energy giant has already paid an estimated $42 billion for spill response and cleanup, including more than $4 billion to settle criminal charges.
The government response was that the unprecedented size of the disaster merits the most severe fine.
Environmental groups are also supporting the largest possible penalty for BP, as a way of sending the energy industry a message about its methods.
(With reports from the Los Angeles Times)
(www.asianjournal.com)
(LA Midweek January 21-23, 2015 Sec. A pg.5)
