BP facing up to 18 million in fines for negligence in Gulf spill

Four years after the horrendous environmental disaster that was the Deepwater Horizon oil rig explosion that rocked the waters of the Gulf Coast, BP claims that, despite their involvement, the blame should be placed on its contractors, Haliburton and Transocean.

A federal judge in New Orleans rejected this notion, which means that BP may receive fines up to $18 billion for its recklessness on top of the $28 billion already spent in damage claims and cleanup costs in the Gulf spill.

The additional penalties come as a result of United States District Court Judge Carl J. Barbier’s findings that BP was “grossly negligent,” noting that the oil giant acted with “conscious disregard of known risks.” BP has only set aside $3.5 billion in anticipation of the new penalties; the potential fine is not only a great deal larger than the amount BP had planned to pay, but it is nearly four-times more than mandated by the Clean Water Act for simple negligence.

As the biggest offshore oil spill in U.S. history, Barbier’s ruling is a landmark decision in environmental law. He attributed 67% of the fault to BP’s negligence; citing a quick decision to shut down a project which was over budget and behind schedule as the catalyst for the disaster. Barbier attributed 30% of the remaining fault to Transocean and 3% to Haliburton.

Barbier’s decision

BP allowed important seals and stoppers to leak along the casing of the well; chose not to administer the full round of tests that may have detected the problem. When certain tests ran, the results skewed more toward BP’s desires and less toward standard safety practices. Barbier said that BP’s actions were driven by monetary goals; they set the disaster in motion, he concluded.

With 11 deaths attributed to the Deepwater Horizon explosion, BP has already pled guilty to manslaughter and other charges. The company will pay $4 billion in federal criminal penalties; but the ultimate cost of its civil liability remains a mystery.

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