Billion Dollar BP Oil Spill Trial Begins

Billion Dollar BP Oil Spill Trial Begins

Trial began yesterday for the April 2010 explosion of BP’s oil rig that that killed 11 workers and dumped millions of barrels of crude oil into the Gulf of Mexico. The initial phase of the trial is intended to determine the degree of blame to be put on BP and all other parties involved in the incident. It is likely that this portion of the trial play out like a blame game between BP, PLC, Transocean Ltd, Haliburton, and the federal government. A separate civil trial, scheduled to start later this year will determine how much oil leaked into the Gulf of Mexico and who will be held financially responsible. The outcome of these two trials carries the potential for imposed fines up to $17.6 billion.

On the morning of the explosion there was a ten-minute ship to shore call between two BP engineers discussing the unusual results from a safety test performed to ensure that the sealing of the bottom of the oil well was successful. This call was made less than an hour before the explosion occurred. Transocean, the owner of the drilling rig, feels that it was made a victim by BP and claims that BP’s instructions to continue working on the rig knowing these test results was, “reckless, in utter and wholesale disregard of the facts.” However, attorney for BP, Mike Brock, argued that the incident was caused by multiple parties on the rig and stated, “a number of mistakes and errors in judgment that were made by BP, Transocean, and Halibuton.” The Justice Department argues that if BP had postponed operations after the results of the test were known, they could have saved the lives of the 11 people killed on the rig. These types of accusations are likely to continue and get worse as the trial progresses and more evidence is presented.

BP has already agreed to pay over $30 billion in fines related to settlements with multiple parties as well as cleanup costs for the oil spill. Transocean has agreed to pay $1 billion in civil fines as well as $400 million in criminal penalties. It is being reported that there is potential for a settlement between the Justice Department, the Gulf Coast Stated affected and BP in the amount of $16 billion. Some argue that this settlement would not be enough of a deterrent for wealthy oil companies to prevent future environmental catastrophes. It will be interesting to see how this very high profile case plays out both in and outside of the courtroom.

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