Deepwater Horizon oil spill trial begins. How much will BP pay?
The Deepwater Horizon oil spill trial got underway Monday. Oil giant BP could face anywhere between $5 billion and $18 billion in fines for its role in the 2010 Deepwater Horizon oil spill.
The key question: How much is BP to blame for the explosion that took the lives of 11 people and spewed an estimated 4.9 million barrels of oil into the Gulf of Mexico – and, thus, how much will it have to pay in civil penalties?
The trial, which could last for months, will pit rival claims of culpability as BP tries to offload responsibility for the Deepwater Horizon disaster onto its onetime partners, Transocean and Halliburton. At stake: up to $18 billion in fines. Prosecutors will have to prove not only that BP made mistakes but it acted with gross negligence.
"Despite BP's attempts to shift the blame to other parties," Justice Department attorney Mike Underhill said in opening statements, "by far the primary fault for this disaster belongs to BP."
Even BP admits it made mistakes in the run-up to the Deepwater Horizon explosion. The British oil giant has pleaded guilty to various criminal charges. It says it has paid some $24 billion in spill-related expenses.
In the current civil case, the penalty will depend on how much of the blame the judge apportions to BP. Under the Clean Water Act, BP could face fines totaling up to $18 billion. If BP successfully makes its case, the fines could run as low as $4 billion. The fine will also depend on how much oil was actually spilled. BP says the size of the spill was overstated by 20 percent.
The British oil giant acted with gross negligence, the Justice Department contends, prioritizing speed over safety in a project that was already behind schedule and $50 million over budget. BP disagrees, saying
“Gross negligence is a very high bar that BP believes cannot be met in this case,” Rupert Bondy, group general counsel of BP, said in a statement last week. “This was a tragic accident, resulting from multiple causes and involving multiple parties. We firmly believe we were not grossly negligent.”
Unable to reach a pretrial settlement, BP lawyers headed to a New Orleans federal courthouse Monday to contest the government's claims.
The New York Times reported Monday that a settlement offer by federal and state officials to the oil company was emerging. That deal would limit the total fines and penalties to $16 billion, lawyers briefed on the matter told the Times.
Barring any such deal, the trial could go on for some time.
"In terms of sheer dollar amounts and public attention, this is one of the most complex and massive disputes ever faced by the courts," Fordham University law professor Howard Erichson told the Associated Press.
Last November, BP reached a settlement with the US Department of Justice that amounted to $4.5 billion in fines and other penalties. The company also pleaded guilty to 14 criminal charges, including manslaughter.
In January, Transocean, the contractor that owned the Deepwater Horizon drilling rig, agreed to pay a $1.4 billion fine for its role in the Gulf oil spill.
This report included material from the Associated Press.