BP legal move to cut civil liability

Oil giant BP has taken legal steps to cut the civil damages it faces for the Deepwater Horizon disaster by up to 3.4bn dollars.

Oil giant BP has taken legal steps to cut the civil damages it faces for the Deepwater Horizon disaster by up to 3.4bn dollars.

The firm has asked a New Orleans court hearing the case against it for civil penalties and damages to rule that at least 810,000 barrels of oil had been captured during the spill and it should not be fined for them.

The Deepwater Horizon rig, which was leased by BP, exploded on April 20th 2010, killing 11 workers and leading to one of the worst environmental disasters in US history.

Under the US Clean Water Act each barrel of oil spilled can result in a fine of up to $4,300 if the guilty party is found to have acted with gross negligence.

The US attorney-general, Eric Holder, has already said he intends "to prove that BP was grossly negligent in causing the oil spill", something the company denies.

BP could face a fine of up to $21bn based on the US government's estimate that 4.9m barrels of oil escaped from the well.

The firm argues that it captured 810,000 barrels-worth escaping from the Macondo well and claims it should not "be penalised for not only trying to do the right thing, but successfully doing the right thing and keeping oil out of the marine environment".

If the court accepts the argument it could reduce the maximum possible fine to $17.6bn.

BP struck a deal with the US government in November, which will see it pay $4.5bn, including a $1.26bn criminal fine.

The oil giant has already spent $14bn on cleaning up the oil spill and compensation to local people and businesses.

Recommended

Share tips of the week – 28 January
Share tips

Share tips of the week – 28 January

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
28 Jan 2022
Which assets will benefit as the “jam tomorrow” bubble pops?
Investment strategy

Which assets will benefit as the “jam tomorrow” bubble pops?

With tech stocks, cryptocurrencies and many other “long duration” investments crashing hard, the “jam tomorrow” bubble looks to be bursting. John Step…
24 Jan 2022
Three innovative Asian stocks to buy now
Share tips

Three innovative Asian stocks to buy now

Professional investor Fay Ren of the Cerno Pacific Fund highlights three of her favourite Asian stocks to buy now
24 Jan 2022
Share tips of the week – 21 January
Share tips

Share tips of the week – 21 January

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
21 Jan 2022

Most Popular

Shareholder capitalism: why we must return power to listed companies’ ultimate owners
Investment strategy

Shareholder capitalism: why we must return power to listed companies’ ultimate owners

Under our system of shareholder capitalism it's not fund managers, it‘s the individual investors – the company's ultimate owners – who should be telli…
24 Jan 2022
Amazon halts plans to ban UK Visa credit card payments
Personal finance

Amazon halts plans to ban UK Visa credit card payments

Amazon has said that it is to shelve its proposed ban on UK customers making payments with Visa credit cards.
17 Jan 2022
Temple Bar’s Ian Lance and Nick Purves: the essence of value investing
Investment strategy

Temple Bar’s Ian Lance and Nick Purves: the essence of value investing

Ian Lance and Nick Purves of the Temple Bar investment trust explain the essence of “value investing” – buying something for less than its intrinsic v…
14 Jan 2022