Judge: BP, Anadarko, Transocean May Be Liable for Oil Pollution Claims

By | February 23, 2012

BP Plc and Anadarko Petroleum Corp. are liable and Transocean Ltd. may be liable for civil damages under federal pollution laws over the catastrophic 2010 Gulf of Mexico oil spill, a U.S. judge ruled.

Wednesday’s decision by U.S. District Judge Carl Barbier in New Orleans lets the government pursue potentially tens of billions of dollars of civil penalties at a trial he is scheduled to oversee beginning on Feb. 27.

Barbier said BP and Anadarko are liable under the Clean Water Act for oil discharged beneath the water surface because they owned a respective 65 percent and 25 percent of the Macondo well that blew out.

The judge ruled that BP and Anadarko are also liable under the Oil Pollution Act for oil removal costs and damages. He said their liability under both laws is “joint and several,” meaning that each could be responsible for the entire amount owed.

“Anadarko and BP were the ones directly engaged in the enterprise which caused the spill,” Barbier wrote.

“If Congress envisioned that the owner of the offshore facility would have to respond to an oil spill such as this one, then it is logical that they would also be the party upon whom the civil penalty is imposed,” he added.

Barbier also said Transocean, whose Deepwater Horizon drilling rig exploded, may be liable under the Clean Water Act as an “operator” of an offshore facility, but that there were “disputed facts” as to whether it met this definition.

He also said Transocean may be liable under the Oil Pollution Act for oil removal costs.

Wyn Hornbuckle, a spokesman for the U.S. Department of Justice, said that agency is reviewing the decision.

BP, Anadarko and Transocean representatives had no immediate comment or did not immediately respond to requests for comment.

Anadarko agreed in October to pay BP $4 billion to settle claims between the companies over the spill.

In exchange, BP agreed to indemnify Anadarko for most spill-related costs, though Anadarko remained liable for its share of fines payable to the government.

The Clean Water Act lets the government seek fines of up to $1,100 per barrel of oil spilled, or $4,300 per barrel if gross negligence or willful misconduct is found.

Assuming 4.1 million barrels were spilled as the government contends, that could result in a penalty of $4.5 billion, and potentially $17.6 billion if there is gross negligence.

Barbier declined to rule that BP and Anadarko could face unlimited liability under the Oil Pollution Act, as the government had requested.

The April 20, 2010 rig explosion caused 11 deaths, and led to the largest offshore oil spill in U.S. history.

BP is based in London; Anadarko in The Woodlands, Texas; and Transocean in Vernier, Switzerland.

The case is In re: Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico, on April 20, 2010, U.S. District Court, Eastern District of Louisiana, No. 10-md-02179.

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