Guilty plea to cost BP $4B for explosion

  • In this June 5, 2010, file photo Plaquemines Parish coastal zone director P.J. Hahn lifts his boot out of thick beached oil at Queen Bess Island in Barataria Bay, just off the Gulf of Mexico in Plaquemines Parish, La. Cleaning the oil far beyond the time the leak is capped will become the job of the U.S. Coast Guard and BP. The Houma Incident Command and Control Center in Houma, La. coordinates the different teams cleaning water from the land and sea. (AP Photo/Gerald Herbert, File)In this June 5, 2010, file photo Plaquemines Parish coastal zone director P.J. Hahn lifts his boot out of thick beached oil at Queen Bess Island in Barataria Bay, just off the Gulf of Mexico in Plaquemines Parish, La. Cleaning the oil far beyond the time the leak is capped will become the job of the U.S. Coast Guard and BP. The Houma Incident Command and Control Center in Houma, La. coordinates the different teams cleaning water from the land and sea. (AP Photo/Gerald Herbert, File)
  • Fireboat response crews battle the blazing remnants of the offshore Deepwater Horizon on April 21, 2010. (AP Photo/U.S. Coast Guard)Fireboat response crews battle the blazing remnants of the offshore Deepwater Horizon on April 21, 2010. (AP Photo/U.S. Coast Guard)
  • In this image taken from video provided by BP PLC, oil leaks from the fractured wellhead at the site of the Deepwater Horizon oil spill in the Gulf of Mexico, Sunday, July 11, 2010. (AP Photo/BP PLC) In this image taken from video provided by BP PLC, oil leaks from the fractured wellhead at the site of the Deepwater Horizon oil spill in the Gulf of Mexico, Sunday, July 11, 2010. (AP Photo/BP PLC)
  • In this Sept. 4, 2010 file photo, the Deepwater Horizon blowout preventer is lifted out of the Gulf of Mexico by the Helix Q4000 near the coast of Louisiana. Before the key piece of evidence has even been analyzed, oil giant BP PLC on Wednesday, Sept. 8, 2010, planned to release the conclusions of its internal investigation into the rig explosion that killed 11 workers and led to the massive Gulf of Mexico spill. (AP Photo/Patrick Semansky, File)In this Sept. 4, 2010 file photo, the Deepwater Horizon blowout preventer is lifted out of the Gulf of Mexico by the Helix Q4000 near the coast of Louisiana. Before the key piece of evidence has even been analyzed, oil giant BP PLC on Wednesday, Sept. 8, 2010, planned to release the conclusions of its internal investigation into the rig explosion that killed 11 workers and led to the massive Gulf of Mexico spill. (AP Photo/Patrick Semansky, File)
  • ** FILE ** Oil from the BP Deepwater Horizon spill floats on the water with clouds reflected in the sheen on Barataria Bay off the coast of Louisiana, June 10, 2010. (AP Photo/Charlie Riedel)** FILE ** Oil from the BP Deepwater Horizon spill floats on the water with clouds reflected in the sheen on Barataria Bay off the coast of Louisiana, June 10, 2010. (AP Photo/Charlie Riedel)
  • In this file photo made June 3, 2010, a brown pelican covered in oil sits on the beach at East Grand Terre Island along the Louisiana coast in the wake of the BP Deepwater Horizon rig explosion. Retired Coast Guard Adm. Thad Allen, the federal government's point man on the disaster, said Sunday, Sept. 19, 2010, BP's well "is effectively dead."  A permanent cement plug sealed BP's well nearly 2.5 miles below the sea floor in the Gulf of Mexico, five agonizing months after an explosion sank a drilling rig and led to the worst offshore oil spill in U.S. history. (AP Photo/Charlie Riedel, File)In this file photo made June 3, 2010, a brown pelican covered in oil sits on the beach at East Grand Terre Island along the Louisiana coast in the wake of the BP Deepwater Horizon rig explosion. Retired Coast Guard Adm. Thad Allen, the federal government's point man on the disaster, said Sunday, Sept. 19, 2010, BP's well "is effectively dead." A permanent cement plug sealed BP's well nearly 2.5 miles below the sea floor in the Gulf of Mexico, five agonizing months after an explosion sank a drilling rig and led to the worst offshore oil spill in U.S. history. (AP Photo/Charlie Riedel, File)
  • ** FILE ** Plaquemines Parish Coastal Zone Director P.J. Hahn rescues a heavily oiled bird from the waters of Barataria Bay, which are laden with oil from the Deepwater Horizon oil spill, in Barataria Bay, La., on June 26, 2010. (AP Photo/Gerald Herbert)** FILE ** Plaquemines Parish Coastal Zone Director P.J. Hahn rescues a heavily oiled bird from the waters of Barataria Bay, which are laden with oil from the Deepwater Horizon oil spill, in Barataria Bay, La., on June 26, 2010. (AP Photo/Gerald Herbert)
  • This Sunday, June 6, 2010 file picture shows a small oil-covered fish on the water's surface at Bay Long off the coast of Louisiana. An April 20, 2010 explosion at the BP Deepwater Horizon offshore platform killed 11 men, and the subsequent leak released an estimated 172 million gallons of petroleum into the Gulf of Mexico. (AP Photo/Charlie Riedel)This Sunday, June 6, 2010 file picture shows a small oil-covered fish on the water's surface at Bay Long off the coast of Louisiana. An April 20, 2010 explosion at the BP Deepwater Horizon offshore platform killed 11 men, and the subsequent leak released an estimated 172 million gallons of petroleum into the Gulf of Mexico. (AP Photo/Charlie Riedel)
  • BP PLC CEO Tony Hayward asks members of the media to step back as he walks along Fourchon Beach in Port Fourchon, La., Monday, May 24, 2010. Hayward visited the beach to observe efforts to clean oil that washed ashore from last month's Deepwater Horizon oil rig explosion in the Gulf of Mexico.  (AP Photo/Patrick Semansky)BP PLC CEO Tony Hayward asks members of the media to step back as he walks along Fourchon Beach in Port Fourchon, La., Monday, May 24, 2010. Hayward visited the beach to observe efforts to clean oil that washed ashore from last month's Deepwater Horizon oil rig explosion in the Gulf of Mexico. (AP Photo/Patrick Semansky)

BP Exploration and Production Inc. agreed Thursday to plead guilty to felony manslaughter, environmental crimes and obstruction of Congress and to pay $4 billion in criminal fines and penalties for its conduct in the 2010 Deepwater Horizon disaster, which killed 11 people and caused the largest environmental disaster in U.S. history.

Attorney General Eric H. Holder Jr. announced the agreement, saying a 14-count information filed in U.S. District Court in Louisiana accused BP of 11 counts of felony manslaughter, one count of felony obstruction of Congress, and violations of the Clean Water and Migratory Bird Treaty acts.

He said BP signed a guilty-plea agreement admitting to its criminal conduct and, subject to approval by the court, said it would pay the largest criminal fines and penalties in U.S. history.

“The $4 billion in penalties and fines is the single largest criminal resolution in the history of the United States and constitutes a major achievement toward fulfilling a promise that the Justice Department made nearly two years ago to respond to the consequences of this epic environmental disaster and seek justice on behalf of its victims,” Mr. Holder said.

“We specifically structured this resolution to ensure that more than half of the proceeds directly benefit the Gulf Coast region so that residents can continue to recover and rebuild,” he said.

In addition to the resolution of charges against BP, Robert M. Kaluza, 62, of Henderson, Nev., and Donald J. Vidrine, 65, of Lafayette, La. – the top-ranking BP supervisors aboard the Deepwater Horizon on April 20, 2010 – are accused of engaging in negligent conduct in a 23-count indictment including felony manslaughter charges.

David I. Rainey, 58, of Houston, a former BP executive who served as a deputy incident commander and BP’s second-highest-ranking representative during the spill response, is charged with obstruction of Congress and making false statements to law enforcement officials.

A grand jury in Louisiana returned the indictments against the three officials Thursday.

According to court documents, while stationed at the Macondo well site in the Gulf of Mexico on April 20, 2010, the Deepwater Horizon rig experienced an uncontrolled blowout and related explosions. In agreeing to plead guilty, BP admitted that the two supervisors negligently caused the deaths and the resulting oil spill.

The documents said that on the evening of April 20, Mr. Kaluza and Mr. Vidrine observed clear indications that the Macondo well was not secure and that oil and gas were flowing into the well. Despite this, the documents said BP’s well-site leaders chose not to take “obvious and appropriate steps to prevent the blowout.” As a result of their conduct, the documents said, the Macondo well was lost, resulting in catastrophe.

Mr. Kaluza and Mr. Vidrine are each charged with 11 felony counts of seaman’s manslaughter, 11 felony counts of involuntary manslaughter and one violation of the Clean Water Act.

The documents also said the company, through Mr. Rainey, obstructed an inquiry by Congress into the amount of oil being discharged into the Gulf while the spill was ongoing. As part of the plea agreement, BP admitted that it withheld documents and provided false and misleading information in response to a House request for flow-rate information.

BP also admitted, according to the documents, that Mr. Rainey manipulated internal estimates to understate the amount of oil flowing from the well and withheld data that contradicted BP’s public estimate of 5,000 barrels of oil per day, although government and independent scientists later concluded that more than 60,000 barrels per day were leaking into the Gulf.

Mr. Rainey is charged with one count of obstruction of Congress and one count of making false statements to law enforcement officials.

A court order has established that more than half of the proceeds will directly benefit the Gulf region. As a result, about $2.4 billion of the $4 billion criminal recovery is dedicated to acquiring, restoring, preserving and conserving the marine and coastal environments, ecosystems and bird and wildlife habitat in the Gulf of Mexico and bordering states harmed by the Deepwater Horizon oil spill.

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