BP agrees to record criminal penalties for US oil spill

Nov 16 2012, 18:39 IST
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SummaryBP Plc will pay $4.5 billion in penalties and plead guilty to criminal misconduct in the Deepwater Horizon disaster, which caused the worst U.S. offshore oil spill ever.

fully accountable, he said.

Holder said at a news conference to discuss the criminal settlement that while the government and BP had held talks to resolve the civil claims, the sides had not been able to agree on a satisfactory number. He said a deal was still possible but the government was moving ahead to the February trial.

Negligence is a key issue. A gross negligence finding could nearly quadruple civil damages owed by BP under the Clean Water Act to $21 billion.

Chief Financial Officer Brian Gilvary said the company's provisions should be enough to cover liabilities, provided it avoids a conviction for gross negligence, and that it had shareholder support to fight the case should that happen.

I can boldly defend where we are in the provisions today. If something were to happen in the trial that read across to gross negligence ... then we would certainly take that to appeal, he said on a conference call with analysts.

Still unresolved is potential liability faced by Swiss-based Transocean Ltd, owner of the Deepwater Horizon vessel, and Halliburton Co, which provided cementing work on the well that U.S. investigators say was flawed.

Halliburton said it remains confident that all the work it performed with respect to the Macondo well was completed in accordance with BP's specifications for its well construction plan and instructions. Halliburton has cooperated with the DOJ's investigation. Transocean was not available for comment.

According to the Justice Department, errors made by BP and Transocean in deciphering a pressure test of the Macondo well are a clear indication of gross negligence.

Transocean disclosed in September that it is in discussions with the Justice Department to pay $1.5 billion to resolve civil and criminal claims.

BP has already announced an uncapped class-action settlement with private plaintiffs that the company estimates will cost $7.8 billion to resolve litigation brought by over 100,000 individuals and businesses claiming economic and medical damages from the spill.

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