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Headway is finally being made in the case against BP (NYSE.BP) over the Deepwater Horizon spill which occurred in 2010.
BP has pleaded guilty to criminal charges and agreed to pay an extra $4.5 billion in damages, in addition to the tens of billions it is already paying to clean up, and appease the victims of the spill.
The British oil major has plead guilty to 11 felony counts of misconduct which resulted in the deaths of 11 workers, one misdemeanour count under the Clean Water Act, one misdemeanor count under the Migratory Bird Treaty Act, and one felony count of obstruction of Congress.
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According to Reuters, two BP employees are also facing criminal charges for their roles in the build-up to the explosion on the rig, which led to the disaster.
The billions of dollars that BP is set to pay will far outstrip its previous largest fine of $373 million, paid back in 2005, after a deadly explosion at a Texas oil refinery, a leak at an Alaskan pipeline, and a case of fraud for plotting to control and manipulate the US propane market.
The deal that BP has made so far only covers the criminal charges levied against them, the civil charges brought by the Department of Justice remain to be settled, meaning that it is still unclear how much BP may have to pay out in total.
If found guilty of gross negligence, then the civil damages could well quadruple to around $21 billion.
Transocean Ltd. (NYSE:RIG), the owner of the Deepwater Horizon platform, and Halliburton Co. (NYSE:HAL), the company that supplied the faulty cement for the doomed well, are still to resolve their liabilities in the case.
By. Charles Kennedy of Oilprice.com
Charles is a writer for Oilprice.com