A Review of the Nigerian Energy Industry

Judge pegs Macondo spill at 3.19m barrels

BP's Macondo rig explosion and oil spill.
BP’s Macondo rig explosion and oil spill.

16 January 2015 – A Louisiana judge has ruled BP should pay US pollution fines on 3.19 million barrels of oil for the 2010 Macondo explosion and spill, avoiding a worst-case outcome but still exposing the company to as much as $13.7 billion in penalties.

The final decision by Carl Barbier fell below the US government’s push for fines on 4.2 million barrels, which could have exposed the company to over $18 billion in fines.

“The court found that BP was not grossly negligent in its source control efforts,” the UK supermajor said in a statement.

“BP believes that considering all the statutory penalty factors together weighs in favour of a penalty at the lower end of the statutory range.”

The April 2010 blowout killed 11 workers and led to the worst offshore spill in US history.

The result is the first reprieve in some time for BP on the legal front, as the supermajor has already booked some $42.7 billion in costs with the disaster and is keen to stanch the bleeding.

The company was found grossly negligent in its handling of the spill in the first phase of the three-part trial last September.

A gross negligence finding generally allows government prosecutors to seek up to $4300 per barrel in penalties for spilt oil when the per-barrel cap is otherwise $1100.

A third phase kicking off next Tuesday will determine the ultimate penalties in the spill.
*Kathrine Schmidt – Upstreamonline

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