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Friday 29 August 2014

BP to pay £2.8bn Deepwater fine

Published 15/11/2012 | 10:00

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BP has agreed a settlement linked to the Gulf of Mexico oil spill (AP)

Oil giant BP is to pay the biggest fine in US history after agreeing a 4.5 billion US dollars (£2.8 billion) settlement with authorities for claims relating to the Deepwater Horizon disaster.

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BP will pay the fine over six years after reaching a deal with the United States Department of Justice (DoJ) and the Securities and Exchange Commission (SEC) that has seen it plead guilty to 14 criminal charges relating to the oil rig accident in 2010, which killed 11 workers and spilled millions of barrels of oil into the Gulf of Mexico.

BP chief executive Bob Dudley said: "We apologise for our role in the accident and as today's resolution with the US government further reflects, we have accepted responsibility for our actions."

Under the deal, BP has pleaded guilty to 11 felony counts of misconduct or neglect and three misdemeanour counts - including one under the Clean Water Act and one for obstructing Congress.

The record-breaking fine surpasses even the 1.3 billion US dollar (£820 million) fine paid by drugs group Pfizer in 2009 for marketing fraud related to a pain medicine.

BP will pay four billion dollars (£2.5 billion) to the DoJ in instalments over five years. It will pay an additional 525 million dollars (£331 million) to the SEC over a period of three years. BP will make the first payment of 175 million dollars (£110 million) this year to the SEC. The group has already paid out more than 38 billion dollars (£24 billion) relating to the oil spill.

Mr Dudley said: "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."

He added: "Since the spill, we have worked hard to rebuild confidence in the company. We take seriously not only our commitment to safety and operational excellence but also our communications with stakeholders, including the public, the government and our investors."

Thursday's settlement removes some of the uncertainty hanging over the stock since the disaster, but it does not cover outstanding civil claims against the group.

BP said it will "continue to vigorously defend itself" against civil claims and allegations of gross negligence. "We are open to settlements, but only on reasonable terms," said Mr Dudley.

Press Association

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