BP could be fined up to $13.7 billion for Macondo spill

The US District Court for the Eastern District of Louisiana ruled under Phase 2 of the MDL 2179 civil trial that 3.19 million bbl of oil were discharged into the Gulf of Mexico during the Macondo deepwater well incident in 2010. BP PLC previously was found negligent in the spill (OGJ Online, Sept. 4, 2014).

That sets the stage for Phase 3, slated to begin Jan. 20, in which the court will determine the company’s Clean Water Act (CWA) penalty.

Based on the ruling, BP PLC faces a possible fine of up to $13.7 billion under the CWA, taking into account the maximum penalty of $4,300/bbl. BP claimed 2.45 million bbl were spilled, contrasting from the government’s claim of 4.2 million bbl. The government was seeking a maximum penalty of $17.9 billion.

During the penalty proceedings, the court will consider eight statutory factors:

• The violator’s efforts to minimize or mitigate the effects of the spill.

• The seriousness of the violation or violations.

• The nature, extent, and degree of success of any efforts of the violator to minimize or mitigate the effects of the discharge.

• The economic impact of the penalty on the violator.

• The economic benefit to the violator, if any, resulting from the violation.

• The degree of culpability involved; any other penalty for the same incident.

• Any history of certain types of prior violations.

• Any other matters as justice may require.

In a statement released following the Phase 2 ruling, BP said it “believes that considering all the statutory penalty factors together weighs in favor of a penalty at the lower end of the statutory range.”