By MICHAEL KUNZELMAN
NEW ORLEANS (AP) - Oil
giant BP has agreed to pay the largest criminal penalty in U.S. history,
totaling billions of dollars, for the 2010 oil spill in the Gulf of
Mexico, a person familiar with the deal said Thursday.
The person, who spoke on
condition of anonymity because they were not authorized to speak on the
record about the deal, also said two BP PLC employees face manslaughter
charges over the death of 11 people in the explosion of the Deepwater
Horizon oil rig that triggered the massive spill.
The person said BP will
plead guilty to obstruction for lying to Congress about how much oil was
pouring out of the ruptured well. The person declined to say exactly
how much the fine in the billions of dollars would be.
The Deepwater Horizon rig,
50 miles off the Louisiana coast, sank after the April 20, 2010,
explosion. The well on the sea floor spewed an estimated 206 million
gallons of crude oil, soiling sensitive tidal estuaries and beaches,
killing wildlife and shutting vast areas of the Gulf to commercial
fishing.
The spill exposed lax
government oversight and led to a temporary ban on deepwater drilling
while officials and the oil industry studied the risks, worked to make
it safer and developed better disaster plans.
BP's
environmentally-friendly image was tarnished, and independent gas
station owners who fly the BP flag claimed they lost business from
customers who were upset over the spill. BP chief executive Tony Hayward
stepped down after the company's repeated gaffes, including his
statement at the height of the crisis: "I'd like my life back."
The cost of BP's spill far
surpassed the Exxon Valdez spill in 1989. Exxon ultimately settled with
the U.S. government for $1 billion, which would be about $1.8 billion
today.
The government and
plaintiffs' attorneys also sued Transocean Ltd., the rig's owner, and
cement contractor Halliburton, but a string of pretrial rulings by a
federal judge undermined BP's legal strategy to pin blame on them.
At the time of the explosion, the Deepwater Horizon was drilling into BP's Macondo well. The rig sank two days later.
After several attempts
failed, engineers finally were successful in capping the well on July
15, 2010, halting the flow of oil into the Gulf of Mexico after more
than 85 days.
The disaster also created a
new lexicon in American vocabulary - such as top kill and junk shot -
as crews used innovative solutions to attempt to plug the spewing well
with pieces of rubber. As people all over the world watched a live spill
camera on the Internet and television, the Obama administration dealt
with a political headache, in part because the government grossly
underestimated how much crude was spilling into the Gulf.
U.S. District Judge Carl
Barbier in New Orleans was assigned to oversee tens of thousands of
court claims spawned by the explosion. A trial date was set, but Barbier
postponed it so BP could hammer out a deal with attorneys for Gulf
Coast shrimpers, commercial fishermen, charter captains, property
owners, environmental groups, restaurants, hotels and others who claim
they suffered economic losses after the spill. Relatives of workers
killed in the blast also sued.
Barbier gave his
preliminary approval to that proposed settlement in May and scheduled a
January trial for the remaining claims, including those by the federal
government and Gulf states.
In a pretrial court filing,
the Justice Department said it would argue that BP's actions and
decisions leading up to the deadly blowout amounted to gross negligence.
"We do not use words like
'gross negligence' and 'willful misconduct' lightly," a Justice
Department attorney wrote. "But the fact remains that people died, many
suffered injuries to their livelihood, and the Gulf's complex ecosystem
was harmed as a result of BP and Transocean's bad acts or omissions."
One of Barbier's rulings
possibly insulates Transocean and Halliburton from billions of dollars
in liability. Barbier said Transocean and Halliburton weren't obligated
to pay for many pollution claims because of contracts they signed with
BP.
The Justice Department
opened a criminal investigation of the spill. The only person facing
charges so far is former BP engineer Kurt Mix, who was arrested in Texas
in April on obstruction of justice charges. Mix is accused of deleting
text messages about the company's response to the spill, not what
happened before the explosion.
The companies also sued
each other, although some of those cases were settled last year. BP has
sued Transocean for at least $40 billion in damages.
And there are still other
claims against BP from financial institutions, casinos and racetracks,
insurance companies, local governments and losses caused by a
government-imposed moratorium on drilling after the spill.
None of those are covered by BP's proposed settlement with the private lawyers.
A series of government investigations have spread blame for the disaster.
In January 2011, a
presidential commission found that the spill was caused by time-saving,
cost-cutting decisions by BP, Halliburton and Transocean that created
unacceptable risk. The panel didn't point blame at any one individual,
concluding the mistakes were caused by systemic problems.
In September 2011, however,
a team of Coast Guard officials and federal regulators issued a report
that concluded BP bears ultimate responsibility for the spill. The
report found BP violated federal regulations, ignored crucial warnings
and made bad decisions during the cementing of the well a mile beneath
the Gulf of Mexico.
BP has repeatedly said it
accepts some responsibility for the spill and will pay what it owes,
while urging other companies to pay their share.
BP waived a $75 million cap
on its liability for certain economic damage claims under the 1990 Oil
Pollution Act, though it denied any gross negligence.
____
Associated Press writer Pete Yost in Washington, D.C., contributed to this story.
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