(ENVIRONMENT) NEW ORLEANS — Last Thursday, British Petroleum (BP) plead guilty to numerous criminal charges associated with the 2010 disastrous oil spill in the Gulf of Mexico. Over the next five years, more than half of the 4.5 billion charged to BP in the settlement will go to the National Fish and Wildlife Foundation (NFWF), an independent non-profit conservation group. NFWF plans to direct the funds for environmental restoration, preservation, and conservation efforts throughout the Gulf region. Although no amount of money can rectify the oil spill’s devastating environmental and wildlife destruction, this steep find shows that the Department of Justice is at least conscious of the gravity of the situation. Read on to learn more about the settlement surrounding the deaths of 11 workers and the spill of 206 million gallons of crude oil. — Global Animal
Chicago Tribune, Tribune Wire Report
A day of reckoning arrived for BP on Thursday as the oil giant agreed to plead guilty to a raft of criminal charges and pay a record $4.5 billion in a settlement with the government over the deadly 2010 disaster in the Gulf of Mexico. Three BP employees were also charged, two of them with manslaughter.
The settlement and the indictments came 2 1/2 years after the drilling-rig explosion that killed 11 workers and set off the biggest offshore oil spill in U.S. history.
The settlement includes nearly $1.3 billion in fines — the biggest criminal penalty in U.S. history — along with payments to entities inside and outside government. As part of the deal, the BP will plead guilty to charges related to the deaths of the 11 workers and to lying to Congress.
“We believe this resolution is in the best interest of BP and its shareholders,” said Carl-Henric Svanberg, BP chairman. “It removes two significant legal risks and allows us to vigorously defend the company against the remaining civil claims.”
Also, BP well site leaders Robert Kaluza and Donald Vidrine were indicted on manslaughter and involuntary manslaughter charges, accused of disregarding abnormal high-pressure readings that should have glaring indications of trouble just before the deadly blowout.
In addition, David Rainey, who was BP’s vice president of exploration for the Gulf of Mexico at the time, was indicted on charges of obstruction of Congress and making false statements. Prosecutors said he withheld information from Congress that indicated the amount of oil spewing from BP’s blown-out well was greater than he let on.
Rainey’s lawyer said his client did “absolutely nothing wrong.” And attorneys for the two rig workers accused the Justice Department of making scapegoats out of them.
“Bob was not an executive or high-level BP official. He was a dedicated rig worker who mourns his fallen co-workers every day,” Kaluza attorneys Shaun Clarke and David Gerger said in a statement. “No one should take any satisfaction in this indictment of an innocent man. This is not justice.”
The settlement, which is subject to approval by a federal judge, includes payments of nearly $2.4 billion to the National Fish and Wildlife Foundation, $350 million to the National Academy of Sciences and about $500 million to the Securities and Exchange Commission. The SEC accused BP of misleading investors by lowballing the amount of crude spewing from the well.
“This marks the largest single criminal fine and the largest total criminal resolution in the history of the United States,” Attorney General Eric Holder said at a news conference in New Orleans. He said much of the money will be used to restore the Gulf.
Holder said the criminal investigation is still going on.
The settlement does not cover the billions in civil penalties the U.S. government is seeking from BP under the Clean Water Act and other environmental laws. Nor does it cover billions of dollars in claims brought by states, businesses and individuals, including fishermen, restaurants and property owners.
A federal judge in New Orleans is weighing a separate, proposed $7.8 billion settlement between BP and more than 100,000 businesses and individuals who say they were harmed by the spill.
BP will plead guilty to 11 felony counts of misconduct or neglect of a vessel’s officers, one felony count of obstruction of Congress and one misdemeanor count each under the Migratory Bird Treaty Act and the Clean Water Act. The workers’ deaths were prosecuted under a provision of the Seaman’s Manslaughter Act. The obstruction charge is for lying to Congress about how much oil was spilling.
The penalty will be paid over five years. BP made a profit of $5.5 billion in the most recent quarter. The largest previous corporate criminal penalty assessed by the U.S. Justice Department was a $1.2 billion fine imposed on drug maker Pfizer in 2009.
Before Thursday, the only person charged in the disaster was a former BP engineer who was arrested in April on obstruction of justice charges. He was accused of deleting text messages about the company’s response to the spill.
Greenpeace blasted the settlement as a slap on the wrist.
“This fine amounts to a rounding error for a corporation the size of BP,” the environmental group said.
Nick McGregor, an oil analyst at Redmayne-Bentley Stockbrokers, said the settlement would be seen as “an expensive positive.”
“This scale of bill is unpleasant,” he said. “But “the worst-case scenario for BP would be an Exxon Valdez-style decade of litigation. I think that is the outcome they are trying to avoid.”