BP’s $4.5 billion settlement approved by federal judge

Under the terms of a separate settlement with the SEC, BP agreed to pay an additional $500,000 in fines for misleading the public about the size of the oil spill.

A federal court in New Orleans has approved the $4 billion settlement that was reached in November between British Petroleum (BP) and the U.S. Department of Justice.

Under the terms of the agreement, BP conceded that it was responsible for the effects of the Deepwater Horizon disaster, including the 11 lives that were lost when an explosion took place on the drilling rig. The international oil company pleaded guilty to 11 counts of felony manslaughter, a number of environmental misdemeanors and a single felony count related to the release of inaccurate information about the size of the spill.

A comparable settlement between the Justice Department and Transocean – the company that crewed and operated the Deepwater Horizon rig on behalf of BP – is still awaiting judicial approval, with a hearing scheduled for February 14.

If the agreement is approved, Transocean would plead guilty to a single count of violating the Clean Water Act and pay a total of $1.4 billion in criminal and civil fines. The company would also be required to implement a raft of new safety measures and adhere to stringent auditing standards.

However, the legal morass stemming from the 2010 oil spill in the Gulf of Mexico will still remain unresolved. BP still faces a civil suit centered on the company’s alleged violations of the Clean Water Act. The penalties in that case could range from $1,000 to $4,300 for each barrel of oil that was spilled.

With government estimates putting the total amount of oil at approximately 4.9 million barrels, BP could face billions of dollars worth of additional liabilities. Halliburton, which participated in the construction of the well that leaked, and Transocean are also parties to the civil suit.

The lingering effects of this incident underscore the importance of using reliable oil production equipment. Caution must be exercised during drill stem testing, drilling and extraction operations in order to ensure the safety of workers and the environment.