BP To Pay $4.5 Billion For Deepwater Horizon Disaster
BP plead guilty to felony misconduct today for the Deepwater Horizon disaster in 2010. The oil company will pay $4.5 billion in penalties for the explosion that killed 11 workers and sent millions of barrels of oil into the ocean.
Reuters reports that an explosion on the Deepwater Horizon in April, 2010, sent 4.9 million barrels of oil into the Gulf of Mexico. The leak lasted for three months and covered shorelines from Texas to Florida.
The Chicago Tribune reports that the oil company has agreed to plead guilty to 11 felony counts of misconduct in relation to the workers who died during the explosion. BP will also plead guilty to one felony count of obstruction of Congress.
The $4.5 billion settlement will be paid to the U.S. Securities and Exchange Commission, the National Fish & Wildlife Foundation and the National Academy of Sciences. The settlement will not include claims under the Clean Water Act or pending civil and state claims filed for economic loss.
Pavel Molchanov, oil company analyst with Raymond James, said:
“It certainly is an encouraging step. By eliminating the overhang of the criminal litigation, it is another step in clearing up BP’s legal framework as it relates to Macondo.”
According to Reuters, the Deepwater Horizon disaster has cost BP much more than this $4.5 billion settlement. The company has sold off more than $30 billion worth of assets and has spent about $14 billion on cleanup efforts. The company has agreed to pay out another $16 billion to compensate individuals and companies that lost money due to the spill.
Transocean, the owner of the Deepwater Horizon rig, and Halliburton, the company that did the cement work, could also see big fines from the Justice Department.