Boston, MA 06/12/2014 (wallstreetpr) – Anadarko Petroleum Corporation (NYSE:APC) as well as BP Plc are likely to face billions of dollars fine, after the ruling of an appeals court said that the two were liable for pollution-law violations as the co-owners of well which was responsible for 2010 Gulf of Mexico oil spill.
Expected Penalty
The US Court of Appeals in New Orleans in its verdict upheld the decision of the lower court. It is expected that the U.S. could seek a whooping amount of fine of $18 billion from BP, in case it was found negligent for its actions which led to oil spill in Mexico in the year 2010. Anadarko Petroleum Corporation (NYSE:APC), which is a owner of 25% interest in the well, would face a maximum fine of $4.6 billion.
The US District Judge Carl Barbier made the initial ruling and he will be responsible for determining the amounts of fines, which will be dependent on a few factors such as attempts to fix the damage caused by the two and the degree of fault made. The decision of the judge on whether BP was intentionally negligent under the US Clean Water Act is still pending. Anadarko, in this context, has been phased out.
Background of the Case
In the year 2010, Macondo well blew out by explosion and this killed 11 workers. This was said to be the worst offshore oil spill in the history of the U.S. The accident attracted various lawsuits against BP as well as Transocean; the owner of the drilling rig and Halliburton.
In December 2010, the U.S. filed a case against BP and Anadarko Petroleum Corporation (NYSE:APC), accusing the two of violating the federal pollution law. In February 2012, the federal judge, Barbier ruled that both these firms were accountable for the civil penalties under law.
As per the Clean Water Act, the government is allowed to seek fines as much as $1100 a barrel spilt in finding of the strict liability as well as up to $4300 a barrel for gross negligence. The ruling of Judge Barbier had found both these companies immediately vulnerable to the fines of $1100 a barrel spilt.
