Tag Archives: clean water act

A French Kiss? Anadarko Fined for Gulf of Mexico Spill

Anadarko Headquarters. image from wikipedia

Anadarko Petroleum Corp. was ordered to pay almost $160 million for its role as part-owner of the doomed Gulf of Mexico well that in 2010 caused the biggest offshore oil spill in U.S. history.
The fine was the last big uncertainty hanging over Anadarko from the disaster. The order on November 30, 2015  comes after the government told U.S. District Judge Carl Barbier in New Orleans that the company should be fined more than $1 billion for its role in the well’s blowout, which killed 11 people and spewed oil for almost three months. Anadarko, which had a 25 percent stake in the Macondo well, argued it shouldn’t be required to pay fines simply because it owned part of the well, as the accident wasn’t its fault. In 2014, The Woodlands, Texas-based company set aside $90 million for the case when it offered to settle for that amount.

Barbier said the fine reflected his finding that Anadarko didn’t have a role in causing the spill. Under the law, he could have imposed as much as $1,100 per barrel of oil spilled, or about $3.5 billion.  The fine is “only 4.5 percent of the maximum penalty, and therefore on the low end of the spectrum,” Barbier said in his order. “The court finds this amount strikes the appropriate balance between Anadarko’s lack of culpability and the extreme seriousness of this spill.”

Barbier rejected Anadarko’s argument that a heavy penalty could cause minority partners to seek a larger role in offshore operations, which might complicate safety and drilling decisions. “A penalty of this size might encourage non-operators to avoid investing with careless operators,” he said.  The company said it’s pleased the penalty is less than what the government sought and that it’s reviewing whether to file an appeal. “While we respect the court’s decision, we continue to believe that penalizing a non-operator for events beyond its control is inconsistent with the intent of the Clean Water Act,” Anadarko said in a statement posted on its website.
David Berg, a Houston attorney who has tracked the oil spill litigation and often sues polluters on behalf of municipalities, said given the damage from the spill, the fine is “not a slap on the wrist; it’s a tongue kiss from the judge.”  David Uhlmann, former head of the Justice Department’s environmental crimes unit, said the fine is “too small to be an effective deterrent.” It “will not have a significant effect on a company worth approximately $30 billion,” said Uhlmann, now a University of Michigan law professor.

The professor said Anadarko wasn’t a silent partner in its dealings with BP Plc, which owned 65 percent of the well.  “Anadarko urged BP to continue drilling deeper, even when BP wanted to stop,” he said. “Yet the judge refused to consider evidence of Anadarko’s risky behavior, which may explain the small size of Anadarko’s fine.”

The government case is U.S. v. BP Exploration & Production Inc., 10-cv-04536, which is part of In Re Oil Spill by the Oil Rig Deepwater Horizon in the Gulf of Mexico on April 20, 2010, MDL-2179, in U.S. District Court, Eastern District of Louisiana (New Orleans). (pdf)

See also BP gross negligence,

What Transocean Pays for the Oil Spill in the Gulf

Excerpt from Anadarko Ordered to Pay $159.5 Million for 2010 Gulf Spill, Bloomberg Business, Nov. 30, 2015

What Transocean Pays for the Oil Spill in the Gulf

transocean headquarters Huston.  Image from wikipedia

Transocean Ltd. appeared in federal court in New Orleans after reaching a $1.4 billion settlement with the U.S. over the 2010 Gulf of Mexico oil spill….The company agreed last week to plead guilty to a misdemeanor count of violating the Clean Water Act and to pay $400 million in criminal fines and $1 billion plus interest in civil penalties. Under the agreement, Transocean will undergo five years’ probation and establish a technology innovation group to focus on drilling safety, devoting a minimum of $10 million to this effort…..

The agreement doesn’t cover costs to Transocean for natural-resources damage under the Oil Pollution Act of 1990, the company said. That law requires responsible parties to reimburse governments for restoring natural resources to pre- incident conditions.  Transocean said last week that the company’s liability for these damages was limited by a 2012 court ruling that it wouldn’t be liable under the Oil Pollution Act for subsurface discharge from the well.

The blowout and explosion aboard Transocean’s drilling rig sent millions of barrels of crude leaking into the gulf. The accident prompted hundreds of lawsuits against Transocean, London-based BP, the well’s owner, and Houston-based Halliburton Co. (HAL), which provided cementing services. BP previously agreed to pay $4 billion to the Justice Department to resolve charges connected to the spill and $525 million to settle the U.S. Securities and Exchange Commission’s claim that the company misled investors about the rate of oil flowing into the gulf.  BP announced Nov. 15 that it reached a deal with the Justice Department to plead guilty to 14 counts, including 11 for felony seaman’s manslaughter. U.S. District Judge Sarah S. Vance said last month that she would determine at a Jan. 29 hearing whether to accept BP’s plea.

The criminal case is U.S. v. Transocean Deepwater Inc., 13- cr-001, U.S. District Court, Eastern District of Louisiana (New Orleans). (pdf)

Margaret Cronin Fisk & Allen Johnson Jr, Transocean Appears in Court After $1.4 Billion Spill Pact, Bloomberg, Jan. 9, 2013

See also How much oil spills cost

 

 

Polluting Low-Income, Minority Neighborhoods: Union Pacific Railroad, United States

Union Pacific Railroad Co. will pay $1.5 million to settle alleged violations of the US Clean Water Act and US Oil Pollution Act.  The settlement with the Environmental Protection Agency resolves a Clean Water Act enforcement action against Union Pacific that involves operations at 20 rail yards and spills of oil and coal in 2003 and 2004 along railroad lines in Colorado, Wyoming and Utah. Most of the rail yards are in low-income areas with minority populations, according to the EPA.

About $1.4 million of the settlement will be deposited into a fund used by federal agencies to respond to oil spills. The remaining $100,000 will be deposited in U.S. Treasurys for coal spills and storm-water violations.   The settlement requires the company to develop a management and reporting system to ensure compliance with various regulations.  Union Pacific also must perform installations to safely store oil and prevent spills from leaving its properties. The company must designate an environmental vice president tasked with following oil spill prevention and storm water control requirements at the 20 rail yards.  The complaint stemmed from six oil spills in Colorado, Utah, and Wyoming and three coal spills in Colorado.

Union Pacific to pay $1.5M settlement in oil spills, Northern Colorado Business Report, February 10, 2012