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BP plc (LSE:BP.) makes history again after agreeing to pay the largest criminal fine in the United States jurisprudence to date, in relation with the Deepwater Horizon explosion in 2010 that claimed 11 lives and caused the costliest oil spill in history.
Eight hours after the London-based oil giant announced it is in “advanced discussions” with the US’ Department of Justice and Securities and Exchange Commission regarding the settling of all criminal prosecution over the incident, BP said it is to pay US$4.5 billion within five years to cover 14 criminal charges it will admit.
“BP has agreed to plead guilty to each of these 14 counts and to pay the highest criminal fine in U.S. history,” said Assistant Attorney General Lanny Breuer at a press conference yesterday.
Guilty
The charges BP will admit in a guilty plea agreement are composed of 11 counts of felony manslaughter, violation of environmental laws, including the US’ Clean Water Act and Migratory Bird Act, and obstruction of Congress.
About US$1.256 billion will be paid as fine – the largest sum ever ordered fine in the US, while US$2.394 billion will go to the National Fish & Wildlife Conservation, US$350 million will be given to the National Academy of Sciences, and US$525 million will be due to the SEC.
“We apologize for our role in the accident… we have accepted responsibility for our actions,” Chief Executive, Bob Dudley, stated on behalf of BP.
The firm’s Chairman, Carl-Henric Svanberg, said the resolution is in the best interest of the company and its shareholders.
On with Civil Cases
However, BP said it will continue to “vigorously defend” itself against all other civil claims filed against it as a result of the disaster.
According to the firm, some US$9 billion has already been paid in aggregate for all claims by individuals, private organisations, and government agencies and it is scheduled to complete its US$20 billion Gulf of Mexico Trust Fund within the current financial quarter.
An agreement to settle approximately US$7.8 billion worth of private economic loss, property damage, and medical claims has also been agreed with the Plaintiff’s Steering Committee, BP said.
BP’s total bill for the year in connection with the incident is increased to almost US$42 billion after the agreement, which is subject to approval by US federal courts.
Shares of BP almost remained unchanged following yesterday’s announcement. At 8:50 AM GMT today, share price was down 0.5 pence to 425.90 pence on the London Stock Exchange.
