BP to pay $4.5B; 3 supervisors charged with manslaughter

The oil giant will absorb huge penalties for the Gulf of Mexico oil spill. How will the verdict and payments affect its tainted reputation?


More than two years after the Deepwater Horizon rig exploded, causing millions of gallons of crude oil to spill into the Gulf of Mexico, BP is paying up.

According to The Washington Post, BP on Thursday agreed to a deal that included guilty pleas to criminal charges of misconduct, neglect, a Clean Water Act violation, obstruction of Congress, and more. The final bill for the company is $4 billion to the U.S. Justice Department, plus $525 million to go the Securities and Exchange Commission.

In addition, three individual supervisors from the rig are facing criminal charges including manslaughter.

Company executives characterized Thursday’s news as the company’s taking responsibility and putting the spill behind it. Bob Dudley, BP’s chief executive officer, issued this statement in response to the deal:

“All of us at BP deeply regret the tragic loss of life caused by the Deepwater Horizon accident as well as the impact of the spill on the Gulf coast region. From the outset, we stepped up by responding to the spill, paying legitimate claims and funding restoration efforts in the Gulf. We apologize for our role in the accident, and as today’s resolution with the U.S. government further reflects, we have accepted responsibility for our actions.”

Norman Birnbach of Birnbach Communications says the significance of the fines and charges against BP should help convince people that BP’s apology is sincere. Dudley’s words are “a far cry” from former CEO Tony Heyward’s “I want my life back” comment as the spill was continuing, he says.

The company statement goes on to say the company will continue to defend itself against upcoming civil claims, but it characterizes the plea deal as “another significant step forward in removing legal uncertainty.”

Jonathan Bernstein of Bernstein Crisis Management says he doesn’t think BP’s plea deal will wipe such a huge stain off its recent history.

“I don’t think the payment does anything for BP’s reputation,” he says. “Only consistent, long-term compliance with regulations and consideration for the environment will do that.”

Birnbach agrees that penalties and apologies alone aren’t enough to erase the spill from people’s memories.

“BP needs to continue to demonstrate it has learned lessons from the tragic event as it continues to drilling for oil around the world,” he says. “It needs to make sure that safety and concern for the environment are part of the company’s culture and are communicated, appropriately, to the public.”

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