BP Pleads Guilty to Criminal Charges in the 2010 Deepwater Horizon Oil Disaster

BP Exploration and Production Inc. (BP) has agreed to plead guilty to felony manslaughter, environmental crimes and obstruction of Congress and pay a record $4 billion in criminal fines and recoveries for its conduct leading to the 2010 Deepwater Horizon disaster that killed 11 people and caused the largest environmental disaster in U.S. history.

The 14-count information charges BP with 11 counts of felony manslaughter, one count of felony obstruction of Congress, and misdemeanor violations of the Clean Water and Migratory Bird Treaty Acts. The agreement is still awaiting approval by the court.

What does the Plea Agreement cover?

These are the criminal charges against BP. These fines do not cover the civil violations, so civil Clean Water Act fines and NRDA claims are still outstanding. The agreement also does not include fines against individuals. However DOJ announced that 2 individuals have been indicted on manslaughter charges in the deaths of 11 fellow workers and 1 individual has been indicted for false statements and obstruction of Congress.

Does this relate to RESTORE Act?

No. The RESTORE Act directs the civil fines from the Clean Water Act violations which have not been settled. The criminal fines from this agreement are not part of RESTORE.

How is this agreement broken down?

Criminal Fines = $1.256 billion

On the 11 counts, BP was charged $500,000 for each count

On the 1 count of criminal violation of the Clean Water Act, BP will pay $1.15 billion which will go to the Oil Spill Liability Trust Fund.

On the count of violating the Migratory Bird Treaty Act, BP will pay $100 million to the North American Wetlands Conservation Fund, for the purpose of wetlands restoration and conservation projects located in States bordering the Gulf of Mexico or otherwise designed to benefit migratory bird species and other wildlife and habitat affected by the oil spill.

On the count of obstruction of Congress, BP will pay a fine of $500,000

Conditions of Probation

Gulf Coast States Get $2.4 Billion in Restoration Funds

$2.394 billion of the criminal recovery is dedicated to remedying harm to resources where there has been injury to, or destruction of, loss of, or loss of use of those resources resulting from the oil spill, as well as significant barrier island restoration and/or river diversion off the coast of Louisiana. BP is required to pay the full amount over five years to the National Fish and Wildlife Foundation (NFWF), a Congressionally‐chartered non‐profit organization with a proven track record and vast experience in Gulf restoration efforts. NFWF will select high‐priority Gulf land acquisition and restoration projects in consultation with relevant State and other regional resource managers.

50% will go to Alabama (14%), Florida (14%), Mississippi (14%) and Texas (8%) to be used to remedy harm to the natural resources caused by BP’s oil

50% will go to Louisiana, also to be used for natural resource restoration, but also for barrier islands and river diversions[1]

How is this different from the Natural Resource Damage Assessment (NRDA)?

These fines are completely separate from the fines BP will have to pay under NRDA. Projects funded through NRDA must show a clear nexus to the injury. Although the language in the Plea Agreement is clear about the intent for how these fines should be spent, there is more flexibility in what projects can be funded with these fines. It is also important to note that the guilty plea agreement notes that the monies paid pursuant to it cannot be used to reduce any civil claims “including but not limited to natural resource damage claims.”

Oil Spill Response and Prevention: Another $350 million is dedicated to a program focused on human health and environmental protection, including issues related to offshore drilling in the Gulf. The program will include research, development, education, training, and monitoring. Pursuant to the plea agreement, BP is required to pay the full amount over five years to the National Academy of Sciences (NAS), a Congressionally‐chartered non‐profit organization and one of the world’s leading scientific organizations.

Changes to Corporate Culture

BP has agreed as part of its guilty plea to retain a process safety monitor and an independent third-party auditor, who will oversee BP’s safety and risk management procedures with respect to deep water drilling in the Gulf of Mexico. BP is also required to retain an ethics monitor to improve BP’s code of conduct for the purpose of seeking to ensure BP’s future candor with the United States government.
BP has also agreed to submit to five years of federal probation, the maximum term permitted by law. BP will be subject to stringent probation conditions, including a requirement that BP not commit any further crime while on probation. Probation conditions also include specific safety improvement measures, and compliance will be overseen by an independent third-party auditor.

[1] Click here for more information about Louisiana’s barrier island and river diversion projects

For more news and opinion about this:

BP Reaches Plea Agreement Over Gulf Oil Spill
November 15, 2012

Criminality in the Gulf Spill
November 15, 2012

BP oil spill: BP agrees to pay $4.5B; 3 employees charged
November 15, 2012

Portion of $4.5 billion BP fine will benefit Mississippi
November 15, 2012

Sen. Richard Shelby: Hold BP accountable to Restore Act
November 15, 2012

BP Oil Spill Settlement: How Much Does Sarasota County Get?
November 15, 2012

Gulf Coast States at Odds on Penalties for Oil Spill
November 16, 2012

Mobile County officials on BP settlement: This is not the end of the story
November 16, 2012

Coastal towns await BP money
November 16, 2012

Fine money is a way forward
November 17, 2012