U.S. Supreme Court rejects BP, Andarko’s final appeal; companies are liable for civil penalties in oil spill case

posted on:
June 29, 2015

author:
Staff

category:
Environmental

The U.S. Supreme Court has declined to hear appeals from BP and Anadarko Petroleum Corp., who challenged a lower court’s decision that kept them liable for civil penalties under the federal Clean Water Act for causing the largest oil spill and environmental catastrophe in the U.S.

The Supreme Court’s rejection lets stand a June 2014 ruling by the U.S. Circuit Court of Appeals, which in turn upheld the original ruling by U.S. District Judge Carl Barbier that found BP and Anadarko, as owners of the Deepwater Horizon oil rig operations, would have to pay the federal pollution fines.

BP faces maximum Clean Water Act penalties of $13.7 billion for its part in causing the 2010 Gulf of Mexico oil spill, which began with an explosion on the Deepwater Horizon oil drilling platform that killed 11 workers and created a spill of more than 3 million barrels of oil. Anadarko, as 25 percent owner of the Macondo well, faces paying a penalty of more than $1 billion for its role.

In September 2014, Judge Barbier ruled that BP was “grossly negligent” in causing the spill – a decision that put the oil giant on the hook for the higher penalties under the terms of the Clean Water Act.

The federal pollution law imposes fines of as much as $1,100 per barrel of oil spilled in a finding of strict liability. In cases where gross negligence is involved, the fines rise to as much as $4,300 per barrel.

BP had hoped to avoid paying the looming pollution fines arguing that it wasn’t liable for the pollution fines because the oil was released by the blowout preventer (BOP) belonging to a unit of Transocean Ltd., which BP had contracted for oil-drilling services.

Sources:
Bloomberg
Associated Press
Reuters
Houston Chronicle

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