BP ‘reckless,’ ‘profit-driven’ in 2010 Gulf oil spill, judge rules
09/04/2014 6:44 PM
09/07/2014 7:48 PM
A federal judge ruled Thursday that oil giant BP was grossly negligent in the 2010 Deepwater Horizon blowout, which killed 11 workers and resulted in the biggest environmental disaster in U.S. history.
U.S. District Judge Carl Barbier’s decision could force BP to pay up to $18 billion in fines under the Clean Water Act.
“BP’s conduct was reckless,” Barbier said in his 153-page ruling.
Barbier found that BP, rather than its contractors, is primarily to blame for the rig blowout, explosion and spill in the Gulf of Mexico.
The judge assigned 67 percent of the blame to BP, with Transocean and Halliburton bearing 30 percent and 3 percent of the blame, respectively. Transocean owned the rig, and Halliburton did the well cement work.
The decision followed years of legal wrangling over blame for the disaster, which led to millions of barrels of oil spilling over almost three months.
BP said in a statement that it would immediately appeal the ruling and that “an impartial view of the record does not support the erroneous conclusion reached by the district court.”
BP already has spent more than $24 billion on oil spill response, cleanup and payments for legal claims by individuals, businesses and government authorities. The company’s stock dropped 5 percent Thursday afternoon after the gross-negligence ruling.
Barbier wrote in the ruling that a series of “profit-driven decisions” by BP led to the disaster.
“These instances of negligence, taken together, evince an extreme deviation from the standard of care and a conscious disregard of known risks,” he wrote.
The finding that multiple acts of “ordinary negligence” can add up to gross negligence _ with much higher penalties _ will have a broader impact on oil companies and other industries, said Blaine LeCesne, a law professor at Loyola University in New Orleans who’s followed the case closely.
Companies that operate with risk, whether it be fracking for oil or mining for coal, are going to need to be a lot more careful, he said.
“They are going to have to more closely monitor their operations every step along the way,” he said.
For the Deepwater Horizon case, it could mean increased punitive damages for BP, as well as the higher fines under the Clean Water Act, LeCesne said.
“BP’s ultimate liability for this has just gone up another $20 (billion) to $40 billion,” he said. “It has a very significant financial impact for BP.”
The judge has not ruled on how much oil was released in the spill, an important factor in determining the size of BP’s liability.
BP will try to limit that liability.
“During the penalty proceedings, BP will seek to show that its conduct merits a penalty that is less than the applicable maximum,” the company said in a statement.
Massachusetts Democratic Sen. Ed Markey said it was clear during his investigation of the spill that “BP compromised safety for speed” in its drilling operations.
“BP should be fully held to account, and should not be allowed to low-ball the size of its spill or take other actions that could reduce their financial liabilities for this disaster,” said Markey, a member of the Senate Environment and Public Works Committee.
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