BP to Plead Guilty for 2010 Spill
British energy giant BP Plc (BP) is expected to plead guilty to criminal misconduct for the 2010 Deepwater Horizon disaster and likely to be asked to pay a record criminal penalty through a plea agreement it has attained with the U.S. Department of Justice, as reported by Reuters.
The sources also revealed that BP would plead guilty, on the condition that all future prosecution related to the charges is abandoned against the company. However, BP and the Justice Department have not revealed any details in this respect.
BP has been confined to long standing negotiations with the U.S. government and Gulf Coast states to resolve the civil and criminal liability claims arising from the April 20, 2010, tragedy that resulted in a loss of lives of 11 personnel and polluted four Gulf Coast states. The settlement comprises billions of dollars in the worst spill in the U.S. history.
However, it remains uncertain as to what form of criminal misconduct BP will plead guilty to, and the amount it will have to shell out to resolve the civil charges inflicted upon it by the Justice Department. It is also uncertain whether the Justice Department will abandon all the civil charges against the company, if it pleads guilty.
Previously, BP had always denied all negligence charges. Now if this is proved wrong the company shall have to pay billions of dollar as penalties under the Clean Water Act. Earlier, to resolve the litigations, BP has given $7.8 billion to private plaintiffs, including individuals and businesses, over the economic and medical damages from the spill.
However, the reimbursements to be paid by Transocean Ltd (RIG) and Halliburton Co. (HAL) remains unclear. These companies provided cementing work on the well that leaked oil. Per the Justice Department, the mistake made by BP and Transocean in translating a key pressure test of the Macondo well clearly points to their negligence.
BP holds a Zacks #3 Rank (Short term Hold rating). Longer term, we maintain our Neutral recommendation.
Read the Full Research Report on BP
Read the Full Research Report on HAL
Read the Full Research Report on RIG
More From Zacks.com
