Gulf oil spill: How much flowed? BP trial judge to decide.
The second phase of a federal civil trial involving BP began Monday. The company faces Clean Water Act fines ranging anywhere between $2.7 billion to $18 billion for the Gulf oil spill.
How much oil spilled in the Gulf of Mexico after the 2010 rig explosion, at what rate, and why it took nearly three months to stop are key questions in a federal civil trial involving British oil giant BP, whose second phase began Monday in New Orleans.
The stakes involved are high: BP faces Clean Water Act fines ranging anywhere between $2.7 billion to $18 billion.
Eleven people were killed in April 2010 when an explosion sank the Deepwater Horizon, a rig leased by BP and located 50 miles off the Louisiana coast. The subsequent rush of oil resulted in one of the worst environmental disasters in US history, damaging wildlife and coastal ecosystems and wreaking havoc on local and state economies.
How much oil continues to be in dispute. The US Department of Justice says an estimated 4.2 million barrels, or 176 million gallons, spilled, while BP calculates 2.45 million barrels, or 103 million gallons. The amount of oil spilled will be key in determining the penalty the company faces.
The two-part trial is designed to sort out the complexities involved with the factors leading up to the explosion, as well as with the efforts afterward. For this phase, the defendants are BP and partner Anadarko Petroleum Corp., while the plaintiffs include two BP contractors – vessel operator Transocean and cement supplier Halliburton – and a steering committee made up of attorneys representing local claimants.
The first phase of the trial ended in late April and largely involved the decisions leading up to the blowout. This second phase is expected to last a month and will examine decisions by BP and others in mitigating the oil flow. A decision will be rendered for the entire trial sometime after both phases conclude.
On Monday, plaintiff attorneys said BP misled federal officials in early reports, saying the oil was flowing at a rate much less than the company’s internal estimates. They say that BP initially reported an oil flow of 5,000 barrels of oil per day, but company engineers were estimating more than 100,000 barrels per day. Early attempts to plug the well, including the “top kill” – which involved pumping mud into the blowout preventer – failed because BP insisted on basing the effort on the lower estimates, they said.
“BP pressed ahead and falsely claimed that [top kill] was a slam-dunk. It failed, just as its outside consultants had predicted,” plaintiff attorney Brad Brian said Monday.
In court filings, BP insists that the unprecedented nature of the disaster forced the company to try measures whose outcomes were impossible to predict and involved a high level of risk. They also say that higher estimates used in company modeling efforts were meant to evaluate worst-case scenarios. A “capping stack” – essentially, a device that could be placed atop a counterpart that failed – was not ready for installation before the top kill experiment, they add.
On Monday, BP attorney Mike Brock said the company “made reasonable engineering decisions based on what was known along each step of the way. That’s not fraud. That’s not gross negligence.” BP spent more than $1.6 billion to cap the well, Mr. Brock added.
“It defies common sense to accept that BP would undertake to execute a top kill procedure knowing that it would not work,” he said.
BP is in “a difficult position” due to evidence that suggests it was aware of the contradictions in its flow rates, says Montré Carodine, a law professor specializing in evidence and transnational litigation at the University of Alabama School of Law in Tuscaloosa.
“There seems to be evidence to suggest they haven’t been truthful about how much oil was flowing, or that they changed their story as to how much. Their actions suggested it was much more than they argued, so now they seem disingenuous at best,” Professor Carodine says.
In January as part of criminal proceedings, BP pleaded guilty to 11 felony counts of misconduct and negligence related to the 11 deaths, as well as one misdemeanor count under the Clean Water Act and one misdemeanor count under the Migratory Bird Treaty Act. It also pleaded guilty to one felony count of obstruction of Congress, related to incorrect flow rate estimates given to members of Congress in the first 14 days of the disaster.
Moreover, the company agreed to pay a $4 billion fine, making it the largest corporate criminal penalty in US history. But BP continued to say it was not grossly negligent, which would imply criminal intent. Instead, the company says its plea was based only on ordinary negligence.
That stance implies that if US District Judge Carl Barbier, who is presiding over the civil trial, determines that the amount of oil spilled is more than BP’s estimates, the company will appeal.
“I’m not sure if we’ll ever really know exactly how much oil was spilled,” says Carodine of the University of Alabama. “If the determination is more, [BP] will never concede that amount. If it works to their advantage, they will concede.”
Environmental groups continue to insist that the oil spill has had long-lasting effects on the ecosystems lining five coastal states. Larry Schweiger, president and CEO of the National Wildlife Federation in Reston Va., released a statement Monday expressing concern that, if BP’s fine falls short of the maximum amount, it will mean less money for important coastal restoration.
“We should be extremely skeptical of BP’s current claims about the volume of oil released into the Gulf. Getting the estimate reduced may boost the company’s bottom line, but it will hurt the prospects for restoration in the Gulf of Mexico,” he said.
A study released last week by the Harte Research Institute at Texas A&M University-Corpus Christi reports that the oil spill led to severe degradation of ocean floor ecosystems for about nine square miles of the wrecked wellhead. Additional damage to the seafloor life could be found for 57 square miles. It will probably take decades for affected species to recover, the report says.
BP released a statement blasting that claim, saying there are “no data” to support it.