BP’s been punished enough – but not because Americans hate the Brits

I should declare two connections before I start offering opinions about the latest US judgment against BP relating to the ‘Macondo’ disaster — the explosion on the Deepwater Horizon oil rig and subsequent spillage in the Gulf of Mexico in 2010. The first is that I’m occasionally invited to interview BP executives for its in-house magazine. That doesn’t mean I’m in their camp, but it does mean I have had the opportunity to discuss Macondo with, among others, chairman Carl-Henrik Svanberg, and I did not think he was merely parroting the corporate line when he told me, ‘We’re not going to let people take advantage of us, but we’re going to do what’s right and be a showcase of responsibility.’

In that spirit, BP has so far paid out $43 billion in clean-up costs and fines (including $4 billion in relation to its guilty plea for manslaughter of the 11 men who died in the explosion) as well as compensation claims — having unsuccessfully challenged a claims administrator who made awards to many inland businesses that did not appear to have been affected at all. Now Louisiana district judge Carl Barbier has found BP liable for ‘gross negligence’ under the Clean Water Act, which imposes penalties of $4,300 per barrel of oil spilled; simple ‘negligence’, which BP expected, would have cost $1,100 per barrel. Judge Barbier allocated two thirds of the blame to BP, and one third to the other companies cited, the Swiss-domiciled rig owner Transocean and the US contractor Halliburton. He will now determine how many barrels were spilled — and if he takes the US government’s estimate of 4.2 million (BP says 2.45 million) the total penalty will be $18 billion.

Barbier’s lengthy judgement focuses on dangerous decisions that were taken on Deepwater Horizon just before the explosion: no one is still arguing that this was what insurers call ‘an act of God’.