BP Plc "conducted an extraordinarily effective response" to the 2010 Gulf of Mexico oil spill, the company's first witness testified Monday as the oil producer sought to minimize potential pollution fines.
BP immediately mobilized people and equipment and recovered spilled oil at the highest-ever rate, retired Coast Guard Capt. Frank Paskewich told U.S. District Judge Carl Barbier in New Orleans federal court. The rate of recovery was almost five times better than in the response to the 1989 Exxon Valdez spill, Paskewich said.
"The record is overwhelmingly clear and supportive that BP did what it needed to do, stepped up to the plate," Paskewich said.
Barbier is conducting a three-week trial without a jury to consider Clean Water Act fines against BP and Anadarko Petroleum Corp., which owned 25 percent of the well. BP faces a maximum potential fine of $13.7 billion, with the government having asked last week for a fine of at least $11.7 billion. The U.S. isn't asking for the maximum fine of $3.5 billion from Anadarko.
BP says it doesn't deserve huge Clean Water Act fines because of its efforts responding to the spill and minimizing its impact.
The blowout of the well off the coast of Louisiana in April 2010 killed 11 people aboard the rig and spewed oil for almost three months into Gulf of Mexico waters and the shores of five states. The accident sparked thousands of lawsuits against BP, as well as Vernier, Switzerland-based Transocean Ltd., owner of the Deepwater Horizon drilling rig, and Houston-based Halliburton Co., which provided cementing services for the project.
The penalty proceeding is the third phase of U.S. trials over the spill.
In the first phase, Barbier determined that BP was grossly negligent before the well blowout, allowing for potential pollution fines to be almost quadrupled. The second phase ended with his Jan. 15 decision that the U.S. overestimated the size of the spill, reducing the possible fine. The judge also gave BP credit for capturing oil as it spewed from the seafloor.
In the penalty phase, Barbier will consider eight criteria in setting the fine, including the seriousness of the violation, the degree of culpability, any history of prior violations, any other penalties for the same incident, and what BP has done to minimize or mitigate the effects of the spill.
Barbier previously ruled that Anadarko wasn't responsible for the spill and is on the hook for pollution fines only as a part owner of the well. Anadarko has argued it shouldn't pay a pollution fine because it had no fault in the spill and paid $4 billion in a settlement with BP, with the money earmarked for claims to those harmed by the spill.
The case is Oil Spill by the Oil Rig Deepwater Horizon in the Gulf of Mexico on April 20, 2010, MDL-2179, U.S. District Court, Eastern District of Louisiana (New Orleans).
Business on 01/27/2015