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BP to pay $4.5B in Gulf spill agreement

6:44 PM, Nov 15, 2012   |    comments
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NEW ORLEANS -- The British oil giant BP said Thursday it has agreed to plead guilty to 11 felony counts involving worker deaths in the 2010 Gulf oil rig blowout and will pay $4.5 billion in penalties in a wide-ranging settlement with the federal government over the massive oil spill.

The charges BP will plead guilty to include 11 felony counts of misconduct or neglect of ships officers, one felony count of obstruction of Congress and one misdemeanor count each under the Migratory Bird Treaty Act and the Clean Water Act. The 11 counts related to the workers' deaths are under a provision of the Seaman's Manslaughter Act.

"All of us at BP deeply regret the tragic loss of life caused by the Deepwater Horizon accident as well as the impact of the spill on the Gulf coast region," said Bob Dudley, BP's Group Chief Executive in a statement on the company's website.

"From the outset, we stepped up by responding to the spill, paying legitimate claims and funding restoration efforts in the Gulf. We apologize for our role in the accident, and as today's resolution with the U.S. government further reflects, we have accepted responsibility for our ctions."

Attorney General Eric Holder is scheduled to join federal and local officials in New Orleans later Thursday for an announcement on the deal, which is still subject to court approvals.

The explosion and fire aboard the Deepwater Horizon rig, 50 miles off the Louisiana coast, on April 20, 2010, killed 11 workers and set off a spill that continued for 87 days, fouling large areas of the Gulf Coast of the United States with 206 million gallons of crude oil.

"Thirteen of the 14 criminal charges pertain to the accident itself and are based on the negligent misinterpretation of the negative pressure test conducted on board the Deepwater Horizon," said a BP news release announcing the settlement.

The test was aimed at determining whether drilling fluids had enough pressure to block the flow of gas to the surface, which is believed to be the cause of the explosion that killed 11 workers and injured many others.

"BP acknowledged this misinterpretation more than two years ago when it released its internal investigation report," the news release said. "Today's agreement is consistent with BP's position in the ongoing civil litigation that this was an accident resulting from multiple causes, involving multiple parties, as found by other official investigations."

The settlement includes payments of nearly $2.4 billion to the National Fish and Wildlife Foundation, $350 million to the National Academy of Sciences and about $500 million to the Securities and Exchange Commission.

The obstruction charge is for lying to Congress about how much oil was pouring out of the ruptured well.

Keith Jones, father of Gordon Jones, who died aboard the Deepwater Horizon during the blowout, said news of criminal charges was welcomed by the families of those killed aboard the rig.

"For 2-1/2 years, we've wondered when anyone was going to be brought to justice for what happened," Jones said. "If in fact this involves somebody being charged or taking responsibility for the blowout itself, then I think we see it as progress."

He said he expected to see multiple people charged and punished in the case.

"This is not a murder case where somebody intentionally killed 11 men," Jones said. "Many decisions were made, all motivated by money, and each of which made the blowout more likely."

The $4.5 billion fine would dwarf the largest previous corporate criminal penalty assessed by the Department of Justice - the $1.2 billion fine imposed on drug maker Pfizer in 2009.

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 criminal settlement between BP and the federal government is just one of a slew of lawsuits and settlements facing the British energy company for their role in the oil spill, said Blaine LeCesne, an associate law professor at Loyola University in New Orleans who has been closely following the case.

USA TODAY

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