Economy

BP faces £11bn civil fine over Deepwater Horizon misdeeds

Published

12 years ago

February 25, 2013

Blue & Green Tomorrow

Oil giant BP is facing civil claims for up to $17.6 billion (£11.6 billion) in relation to the Deepwater Horizon disaster in the Gulf of Mexico.

The firm today started the first phase of the trial against the US states affected by the 2010 oil spill as well as the US Department of Justice.

The trial will determine whether or not the oil giant has been grossly negligent in what is considered one of the most tragic environmental disasters in history.

Nick McGregor, an oil analyst at Redmayne Bentley Stockbrokers, told the BBC, “If they are found grossly negligent it will set the tone on the level of fines BP will have to pay, and the financial consequences will be huge.”

The second phase of the trial will start later this year and will look at the amount of oil leaked to decide on the federal fine.

On Friday, the Wall Street Journal reported that claimants were considering offering BP a deal asking for $16 billion (£10.5 billion) to settle civil suits.

BP spokesman Geoff Morrell, contacted by Reuters, said, “BP doesn’t talk about possible offers or negotiations, but I can tell you we are ready for trial and looking forward to the opportunity to present our case starting Monday.”

In November, BP agreed to pay $4.5 billion (£2.8 billion) as settlement for criminal charges related to the oil spill.

At the time, Blue & Green Tomorrow expressed doubts about effectiveness of these fines, considering the incredible amount of profits earned by the company and the money put into PR strategies to rebuild its reputation.

This time around, according to the BBC, if BP is found guilty of gross negligence, the maximum penalty might rise up to around $17.6 billion (£11.6 billion).

Campaigners are likely to see this as a more appropriate fine, but questions remain about whether it will be enough to stop the company from acting negligently in the future.