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New Orleans - BP To Pay US Billions, To Admit Criminal Misconduct 0ver 2010 Gulf Spill

Published on: November 15, 2012 08:49 AM
By: AP
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New Orleans - Oil giant BP has agreed to pay the largest criminal penalty in U.S. history, totaling billions of dollars, for the 2010 oil spill in the Gulf of Mexico, a person familiar with the deal said Thursday.

The person, who spoke on condition of anonymity because they were not authorized to speak on the record about the deal, also said two BP PLC employees face manslaughter charges over the death of 11 people in the explosion of the Deepwater Horizon oil rig that triggered the massive spill.

The person said BP will plead guilty to obstruction for lying to Congress about how much oil was pouring out of the ruptured well.

The Deepwater Horizon rig, 50 miles off the Louisiana coast, sank after the April 20, 2010, explosion. The well on the sea floor spewed an estimated 206 million gallons of crude oil, soiling sensitive tidal estuaries and beaches, killing wildlife and shutting vast areas of the Gulf to commercial fishing.

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The spill exposed lax government oversight and led to a temporary ban on deepwater drilling while officials and the oil industry studied the risks, worked to make it safer and developed better disaster plans.

BP’s environmentally-friendly image was tarnished, and independent gas station owners who fly the BP flag claimed they lost business from customers who were upset over the spill. BP chief executive Tony Hayward stepped down after the company’s repeated gaffes, including his statement at the height of the crisis: “I’d like my life back.”

The cost of BP’s spill far surpassed the Exxon Valdez spill in 1989. Exxon ultimately settled with the U.S. government for $1 billion, which would be about $1.8 billion today.

The government and plaintiffs’ attorneys also sued Transocean Ltd., the rig’s owner, and cement contractor Halliburton, but a string of pretrial rulings by a federal judge undermined BP’s legal strategy to pin blame on them.

At the time of the explosion, the Deepwater Horizon was drilling into BP’s Macondo well. The rig sank two days later.

After several attempts failed, engineers finally were successful in capping the well on July 15, 2010, halting the flow of oil into the Gulf of Mexico after more than 85 days.

The disaster also created a new lexicon in American vocabulary - such as top kill and junk shot - as crews used innovative solutions to attempt to plug the spewing well with pieces of rubber. As people all over the world watched a live spill camera on the Internet and television, the Obama administration dealt with a political headache, in part because the government grossly underestimated how much crude was spilling into the Gulf.

U.S. District Judge Carl Barbier in New Orleans was assigned to oversee tens of thousands of court claims spawned by the explosion. A trial date was set, but Barbier postponed it so BP could hammer out a deal with attorneys for Gulf Coast shrimpers, commercial fishermen, charter captains, property owners, environmental groups, restaurants, hotels and others who claim they suffered economic losses after the spill. Relatives of workers killed in the blast also sued.

Barbier gave his preliminary approval to that proposed settlement in May and scheduled a January trial for the remaining claims, including those by the federal government and Gulf states.

In a pretrial court filing, the Justice Department said it would argue that BP’s actions and decisions leading up to the deadly blowout amounted to gross negligence.

“We do not use words like `gross negligence’ and `willful misconduct’ lightly,” a Justice Department attorney wrote. “But the fact remains that people died, many suffered injuries to their livelihood, and the Gulf’s complex ecosystem was harmed as a result of BP and Transocean’s bad acts or omissions.”

One of Barbier’s rulings possibly insulates Transocean and Halliburton from billions of dollars in liability. Barbier said Transocean and Halliburton weren’t obligated to pay for many pollution claims because of contracts they signed with BP.

The Justice Department opened a criminal investigation of the spill. The only person facing charges so far is former BP engineer Kurt Mix, who was arrested in Texas in April on obstruction of justice charges. Mix is accused of deleting text messages about the company’s response to the spill, not what happened before the explosion.

The companies also sued each other, although some of those cases were settled last year. BP has sued Transocean for at least $40 billion in damages.

And there are still other claims against BP from financial institutions, casinos and racetracks, insurance companies, local governments and losses caused by a government-imposed moratorium on drilling after the spill.

None of those are covered by BP’s proposed settlement with the private lawyers.

A series of government investigations have spread blame for the disaster.

In January 2011, a presidential commission found that the spill was caused by time-saving, cost-cutting decisions by BP, Halliburton and Transocean that created unacceptable risk. The panel didn’t point blame at any one individual, concluding the mistakes were caused by systemic problems.

In September 2011, however, a team of Coast Guard officials and federal regulators issued a report that concluded BP bears ultimate responsibility for the spill. The report found BP violated federal regulations, ignored crucial warnings and made bad decisions during the cementing of the well a mile beneath the Gulf of Mexico.

BP has repeatedly said it accepts some responsibility for the spill and will pay what it owes, while urging other companies to pay their share.

BP waived a $75 million cap on its liability for certain economic damage claims under the 1990 Oil Pollution Act, though it denied any gross negligence.


More of today's headlines

Washington - Superstorm Sandy drove the number of people seeking unemployment benefits up to a seasonally adjusted 439,000 last week, the highest level in 18... Kiryat Malachi - Blood stains could be seen up and down the stairwell of the Kiryat Malachi building where three Israelis were killed by a Gaza rocket on Thursday...

 

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Read Comments (6)  —  Post Yours »

1

 Nov 15, 2012 at 09:41 AM SherryTheNoahide Says:

Good! I hope they get stuck w\the full amount of settlement they CAN be stuck with having to pay! Although I doubt any amount of $ will help to soothe the pain of the 11+ sets of families who lost a loved one because of the "accident", not to mention the countless #'s of other folks who lost their livilehoods, their way of providing for their families, their jobs, everything! And what it did to Nature?! To the environment?! HaShem help Us! But then again, when we run around screaming "drill baby drill" no matter WHAT the cost...do we even deserve any help in this matter at all??

When will our love of oil ever end?! During the President's 1st term, he increased oil production even more than his predecessor! And while conservatives might like to hear that, (that's if they'll even BELIEVE it to begin with-lol-conspiracy nutters!), Us liberals & environmentally-friendly folks wanted to see this country go in a different direction! I'm glad President Obama set aside $90bil for green-technology! But that's not going to be enough to dig ourselves out of our dependance on fossil fuels & all the damage from using them that it's caused!

The America of the future should be looking to completely revamping it's energy policy & changing our whole way of mobilization & transportation! Mag-lev trains, electric cars, a whole new electric grid...think of the jobs that would produce! Holy cow! We need to go BIG like that! Be not afraid! Our future generations would THANK US for building ourselves up & advancing ourselves!

But if a Lib or a Dem even *suggests* such a big move like this...the cowardly, penny-pinching & "constantly living in the 1950's" Republican party HOWLS about the cost & tries to say Climate Change is a hoax created by Al Gore! You can't make this stuff up folks! LOL

And it's sad...how are we ever going to get ahead when there's a good chunk of the country AFRAID to do big things like this?! Afraid that it's "too European", too "not worth it"?!

It's kinda depressing! :-\

2

 Nov 15, 2012 at 09:51 AM SherryTheNoahide Says:

PS: Republicans really ARE big fans of Big Oil. It's a problem, because it keeps Us All absolutely addicted to it too, whether any of Us want to be or not!

If I'm not mistaken, I believe Brazil revamped their auto industry back in the 1990's, and now 95% of ALL cars there are at least 50\50 electric & fuel option-type cars, with most being non-fuel all together! That was incredibly forward thinking coming from a country that many of us would have considered to be "3rd world"!

So who we vote for REALLY does matter, because there is a Party in this country that believes in moving forward, new technologies, accepts Science & in a lot of cases Spirituality as well....and then there's a Party that obsesses over controlling people, supressing voting rights, rejects climate change, wants to kick people off Food Stamps & let them starve in a climate where there's NO work for miles & miles in some cases! I could go on & on!

A person can vote for the party that WOULDN'T allow BP to just drill anywhere, any way they like, with absolutely ZERO regulations! There's other options out there!

You don't necessarily have to start voting for Democrats now... but you DON'T have to keep sticking w\these old codgers up there in Washington, that keep dragging this country down into economic, psychological, industrial & spiritual despair! Heck, the GREEN PARTY would be a better choice than the Republicans at this point!

We simply HAVE to get serious about our dependancy on foreign oil & fossil fuels all together, or well... we just AREN'T serious!

3

 Nov 15, 2012 at 09:51 AM cookookajew Says:

That's all well and good but what about cleaning up the mess. They may have completely destroyed the ecosystem there. Soon well be eating radioactive, sludge filled sushi.

4

 Nov 15, 2012 at 09:54 AM myownopinion Says:

BP is not paying this. You are at the pump.

5

 Nov 15, 2012 at 01:25 PM SherryTheNoahide Says:

Reply to #3  
cookookajew Says:

That's all well and good but what about cleaning up the mess. They may have completely destroyed the ecosystem there. Soon well be eating radioactive, sludge filled sushi.

I agree w\You wholeheartedly! And I'll be honest in saying that I have no CLUE how BP is going to clean up what they've done to the eco-system! No idea! I can't even imagine how they CAN fix it - it may be that only Nature & Time can fix it now!

So that's why my point was to say that we cannot keep doing this to our planet just to save a little $ at the pump! A more forward-thinking, progressive country, would be looking into alternative means of energy at this point! NOT increasing the drilling & letting them get away w\no regulations, the way Bush did & now Obama is doing too, much to my unhappiness.

The only way I see us going forward, is to do some BIG things that will get us no longer depending on fossil fuels so much in the 1st place! We can shut down some of this "drill baby drill" nonsense & move on to cleaner, more efficent & cheaper(!) ways of doing mass transportation, producing cars, etc. We will remain on top all over the world in the auto industry, while completely revamping & updating our country's grid here at home!

And you will NOT catch Republicans proposing we do anything "big" like this for the common man's good! No way! They'd rather keep promising you cheap gas, keep damaging the planet, keep you dependant on fossil fuels, made up of Big Oil people they all know!

Well when is enough money EVER "enough" money for these people?! Once the earth is totally ravaged & there's nothing left?!

What's it going to take to get them to understand that making lots of money & having cheap gas NOW...is gonna cost this country & this planet a lot later?! We're already seeing the effects of it!

So that's why I say DON'T VOTE 4 THEIR BACKWARDS NONSENSE anymore! They are NOT friendly to the earth, it's environment, or the poor people living IN it, for that matter! They want Us to go BACk to a 1950's mindest when it comes to energy!

But we must keep moving FORWARD!

6

 Nov 15, 2012 at 10:27 PM PaulinSaudi Says:

We can only hope their poor CEO finally got his life back.

7

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