A federal judge found BP grossly negligent in its conduct that resulted in the worst offshore oil spill in American history. “Grossly negligent” rather than just “negligent” exposes BP to between $10.3 billion and $17.6 billion in new civil penalties, almost four times the maximum Clean Water Act fine for simple negligence.
The potential penalties dwarf the $3.5 billion BP has set aside.
In April 2010, while drilling at the Macondo Prospect in the Gulf of Mexico, an explosion on the Deepwater Horizon rig caused a blowout that killed eleven workers and ignited a fireball that was visible forty miles away.
The resulting fire could not be put out and a few days later the Deepwater Horizon rig sank, leaving the well gushing oil at the bottom of the sea, causing the biggest offshore oil spill in the history of the United States.
On Thursday, Judge Carl Barbier assigned blame as follows:
- BP: 67%,
- Transocean: 30%.
- Halliburton: 3%.
According to Judge Barbier, BP’s “profit-driven decision” during the drilling led to the fatal blowout.
In his 153-page ruling, Judge Barbier wrote:
“The Court concludes that the discharge of oil ‘was the result of gross negligence or wilful misconduct‘ by BP. BP’s conduct was reckless. These instances of negligence, taken together, evince an extreme deviation from the standard of care and a conscious disregard of known risks.”
BP statement on the ruling
In an public statement issued on September 4th, 2014, BP said it strongly disagrees with the court’s ruling.
The British oil & gas giant says that evidence presented at trial does not support the decision that it was grossly negligent regarding the accident and that its activities at the oil well amounted to willful misconduct.
“The law is clear that proving gross negligence is a very high bar that was not met in this case. BP believes that an impartial view of the record does not support the erroneous conclusion reached by the District Court.”
BP says it will appeal.
Earlier this week, oil field services company Halliburton reached a settlement worth $1.1 billion.
The money is to be pain in three installments over the next 24 months into a trust until all appeals have been resolved.
The settlement, which needs to be approved, will void the risk of further damage, even if it is found grossly negligent by Judge Barbier.
It will also resolve a class action by a group of fishermen.