Entries in Oil Spill (9)


BP Arrest Made on Criminal Charges

U.S. Coast Guard via Getty Images(WASHINGTON) -- The flow of oil into the Gulf of Mexico after the Deepwater Horizon disaster two years ago was much larger than BP had publicly stated, according to charges filed Tuesday by the Justice Department. The information was revealed in the criminal complaint against former BP engineer Kurt Mix, who was arrested Tuesday on charges of intentionally destroying evidence.

The charges against Mix, 50, mark the first criminal case brought by the Justice Department in the wake of the April 20, 2010, blowout on the oil rig in the Gulf of Mexico, and provides evidence that BP might have misled the public and the government about the flow rate of oil pouring into the Gulf. The Deepwater Horizon blowout and resulting explosions at the Macondo well killed 11 people and resulted in the largest environmental disaster in U.S. history.

Mix worked on internal BP efforts to estimate the amount of oil gushing from the well and was involved in efforts to stop the flow. Court documents allege that Mix deleted a text he had sent on the evening of May 26, 2010, at the end of the first day of an effort to cap the well called "Top Kill."

In the text exchange with a BP supervisor, Mix wrote, "Too much flowrate – over 15,000."

At the time, BP's public estimate of the flow rate was 5,000 barrels of oil per day, three times lower than the minimum flow rate indicated in Mix's text.

Mix allegedly deleted more than 200 texts with his supervisor but many of them, the FBI affidavit notes, have been recovered using forensic tools.

In addition, the Justice Department charges that Mix allegedly deleted more than 100 text messages with a BP contractor concerning how much oil was flowing from the Macondo well after the blowout. Mix allegedly deleted those texts after learning that his iPhone was about to be imaged by a vendor working for BP's outside counsel.

The FBI affidavit states that Mix noted in his initial estimates that early flow rates coming from the Macondo well ranged from 64,000 to 138,000 barrels of oil per day in the immediate aftermath of the explosion.

"The department has filed initial charges in its investigation into the Deepwater Horizon disaster against an individual for allegedly deleting records relating to the amount of oil flowing from the Macondo well after the explosion that led to the devastating tragedy in the Gulf of Mexico," Attorney General Eric Holder said. "The Deepwater Horizon Task Force is continuing its investigation into the explosion and will hold accountable those who violated the law in connection with the largest environmental disaster in U.S. history."

If convicted, Mix faces a maximum penalty of 20 years in prison and a fine of up to $250,000 as to each count.

An official statement from BP said the company would cooperate with "the Department of Justice and other official investigations into the Deepwater Horizon accident and oil spill."

It suggested the company had "clear policies" about preserving evidence. But the company would not comment specifically on the allegations against Mix.

"We will not comment on the government's case against former BP employee Kurt Mix and we will continue cooperating in the Department of Justice's investigation," according to the statement from BP's corporate office.

Copyright 2012 ABC News Radio


BP, Plaintiffs Reach Settlement on Gulf Oil Spill 

NASA/GSFC/LaRC/JPL, MISR Team(NEW ORLEANS) -- BP announced on Friday that it has agreed to a settlement with Plaintiffs' Steering Committee to resolve economic loss, property damage and medical injury claims from the oil spill.

"From the beginning, BP stepped up to meet our obligations to the communities in the Gulf Coast region, and we've worked hard to deliver on that commitment for nearly two years,” BP Group CEO Bob Dudley said. "The proposed settlement represents significant progress toward resolving issues from the Deepwater Horizon accident and contributing further to economic and environmental restoration efforts along the Gulf Coast."

The cost of the proposed settlement is estimated to be about $7.8 billion—making it one of the largest class-action settlements in history.

The settlement does not, however, involve the Justice Department and a spokesman said, “Although we remain open to a fair and just settlement, we are fully prepared to try the case.”

Copyright 2012 ABC News Radio


Ruptured ExxonMobil Pipeline Spills Oil into Yellowstone River

ExxonMobil(BILLINGS, Mont.) -- A ruptured ExxonMobil Pipeline Company (EMPCo) pipeline reportedly sent oil gushing into the Yellowstone River on Saturday.

Company officials say early Saturday morning it was discovered that an “undetermined amount” of crude oil was released into the river from an EMPCo pipeline.

“EMPCo deeply regrets this release and is working hard with local emergency authorities to mitigate the impacts of this release on the surrounding communities and to the environment,” the company said in a press release.

The company said the 12-inch crude pipeline that broke runs from Silver Tip, Mont. to Billings, Mont., and the ruptured line has since been shut down. However, officials could not say what caused the spill.

“At this early stage, we have no information on the cause of the incident, and we are working to determine the amount of oil released,” the company said in its press release.

“We recognize the seriousness of this incident and are working hard to address it. Our principal focus is on protecting the safety and health of the public and our employees. We will, of course, also begin a thorough investigation of the cause of this unfortunate event.”

EMPCo says it has notified the appropriate state and federal authorities, and has also set up a claims number (1-888-382-0043) to assist anyone who might have been affected by the oil spill.

Copyright 2011 ABC News Radio


'Spillionaires' Profiting off BP Oil Spill

U.S. Coast Guard via Getty Images(ST. BERNARD PARISH, La.) -- The massive BP oil spill that devastated the Gulf Coast has turned out to be an economic boon for local governments and businesses, and even spawned a new word describing those who are profiting off the disaster -- "spillionaires."

Basic goods -- from bottles of water to port-o-johns, boats and lumber -- are all being sold to BP at inflated prices, often 20 times the going rate.

"It's been very good for our business, I'll tell you that," said businessman Ronnie Hyer, whose company sells safety equipment to cleanup crews.

A team of government-contracted biologists are currently renting a modest four-bedroom home at a rate of $30,000 per month, and the petroleum company seems to have no problem footing the bill.

Mike Utsler, chief operating officer for BP's Gulf Coast Restoration Organization, told ABC News the company wasn't focused on price -- it just wants to deliver results in a timely manner.

"Our focus was getting people, getting equipment and meeting the challenges of this historic response," Utsler said.  "No matter what it took at that point in time."

When BP and the government set up an army of 48,000 cleanup workers, businessmen like Hyer sold the company anything from Tyvek suits to kitty litter scoopers, causing his business to increase 1,000 percent.

But Wayne Landry, a councilman in St. Bernard Parish, Louisiana thinks that the nearly $18 billion BP spent could have been put to better use.  In fact, he said his parish -- and others -- have "raped" BP.

"[We] wanted a better impact on the money, instead of gouging them on certain costs," he said.

Despite the criticism, local governments are raking in tax revenue, thanks to the cleanup efforts.

St. Bernard Parish saw a 96 percent spike in sales tax receipts.  Nearby Plaquemines Parish experienced a 70 percent increase.

But while there are plenty of "spillionaires" profiting from the cleanup efforts, tens of thousands of claimants are still waiting for their piece of the $20 billion settlement fund. 

Copyright 2011 ABC News Radio


BP Wants to Resume Oil Drilling in the Gulf of Mexico

U.S. Coast Guard via Getty Images(LONDON) -- BP isn’t about to let the biggest accidental oil spill in the history of the petroleum industry stop it from returning to drilling in the Gulf of Mexico.

The British oil giant, which leased the Deepwater Horizon rig that exploded one year ago this month, killing 11 workers, wants to drill ten development wells that were underway in the Gulf at the time of the accident.  These wells are designed to increase or maintain production at BP’s existing oil fields.

U.S. officials from the Bureau of Office Energy, Management Regulation and Enforcement would need to sign off on permits before BP could resume drilling by this summer, at the earliest.  One of the conditions would make it mandatory for BP to allow government overseers 24-hour access to its drilling operations.

Environmentalists, still upset with BP for the way it handled the leak that caused 200 million gallons of crude oil to spill into the Gulf, are leery of the company’s petition and don’t believe that constant monitoring “will adequately mitigate the dangers of deepwater drilling.”

The Obama administration also has to consider that granting BP permission to drill could be a political hot potato heading into an election year.  BP still has to pay billions for clean-up costs in the Gulf, as well as deal with numerous ongoing civil and criminal probes.

Copyright 2011 ABC News Radio


Gov. Sean Parnell: "Let Alaska Help Put America Back to Work"

Photo Courtesy - Getty Images(WASHINGTON) -- With uncertainty spreading across the Middle East the current governor of Alaska, Sean Parnell, is on a mission to open his state to more oil exploration.

Parnell spoke at the National Press Club in Washington and emphasized that America’s security is at stake if the U.S. oil supply continues to come from unstable areas and regimes.

“More domestic oil production, not less, better secures our nation and grows our jobs at home.”

Oil production in Alaska has long been a matter of fierce political debate, particularly whether companies should be able to drill in the Arctic National Wildlife Reserve and offshore oil drilling.

Alaska has been targeted in the moratorium since the Deepwater Horizon oil spill. In a press conference on May 27, 2010 President Obama said, “We will suspend the planned exploration of two locations off the coast of Alaska.” 

Originally scheduled to expire in November, the moratorium was lifted in October because pressure from oil and fishery businesses.  However, regulators at Interior Department have yet to issue permits due to the strict safety regulations imposed after the Horizon oil spill. There has been no exploration in U.S. waters deeper than 500 feet since BP’s explosion in April.

“Let’s face it. We are dependent on an open free-fall Suez Canal, a canal through an unstable region the security of which has been purchased with our taxpayers’ dollars,” Parnell said, referring to the change of power in Egypt.

The governor’s solution is opening up Alaska and other U.S. lands for oil exploration, despite environmentalist opposition to offshore drilling and exploration in ANWR.  With Alaska producing 11 percent of national oil production, Parnell said there is more to be found.

Criticizing the Department of Interior and EPA for driving more dependence on foreign oil, Parnell asks that federal agencies “let Alaska help put America back to work.”

Copyright 2011 ABC News Radio


White House to BP: Shell Out More Cash

Photo Courtesy - Getty Images(WASHINGTON) -- The Obama administration is urging the manager of the $20 billion BP claims fund to shell out more money to victims of last year's oil spill in the Gulf of Mexico.

In a letter, Associate Attorney General Thomas Perrelli told claims czar Kenneth Feinberg that he needs to loosen the purse strings, reminding him that his job is not to preserve the money, but to spend it.

Copyright 2011 ABC News Radio


BP Reports Loss of $4.9 Billion in 2010

Photo Courtesy - Jim Watson/AFP/ Getty Images(LONDON) -- BP, the oil company behind the oil spill in the Gulf of Mexico last year, reported on Tuesday an annual loss of $4.9 billion in 2010.

The loss includes a total pre-tax charge of $40.9 billion in connection to the oil spill.  BP said it will also resume paying dividends which were suspended after the Deepwater Horizon rig exploded back in June of last year.  Shareholders will receive seven cents a share for the fourth quarter of 2010.

"2010 will rightly be remembered for the tragic accident and oil spill in the Gulf of Mexico and it is clear that as a result BP is a company in transition.  I am determined that we will emerge from this episode as a company that is safer, stronger, more sustainable, more trusted and also more valuable," BP group chief executive Bob Dudley said.

Additionally, BP announced Tuesday plans to sell two of its refineries in the U.S. -- one in Carson, California and another in Texas City, Texas, where 15 people were killed in an explosion in March of 2005.

"2011 will be a year of recovery and consolidation as we implement the changes we have identified to reduce operational risk and meet our commitments arising from the spill.  But it will also be a year in which we have the opportunity to reset the company, adjusting the shape of our business, and focus on growing value for shareholders," Dudley said.

Copyright 2011 ABC News Radio


BP Management Blamed for Gulf Oil Spill

Photo Courtesy - PRNewsFoto(WASHINGTON) -- The National Oil Spill Commission released the scathing first chapter of its forthcoming full report on the investigation into the blowout of BP's Macondo well, concluding not only that BP's chronic failure of management led to the blowout, but that the problems were systemic and that such a spill could happen again.

While the conclusions are in just the first chapter of the full report, the commission's findings could have significant implications for the world's oil giants, which are some of the biggest and most profitable companies in the world.

The commission, appointed by President Obama, noted that "most of the mistakes and oversights at Macondo" which led to the mammoth explosion "can be traced back to a single overarching failure -- a failure of management."

Ensnared in a culture of poor management, the inability to communicate concerns and incipient risk-taking, BP's well was doomed, said the report.

According to the report, technical and engineering failures led to the blowout itself, including a flawed design, shortcuts taken in cementing the well, and failure to manage the blowout once it began.

All those points had already been published, but in this final report the commission's co-chair said that "given the documented failings of both Transocean and Halliburton, both of which serve the offshore industry in virtually every ocean, I reluctantly conclude we have a system-wide problem."

The report concludes that "the root causes are systemic and, absent significant reform in both industry practices and government policies, might well recur." That is, a future blowout and resulting oil spill could happen again.

The Department of the Interior responded with a statement that it has "already identified, acknowledged, and spent months working aggressively to reform offshore drilling."

That includes an overhaul of the regulatory body that was created to provide oversight on wells like BP's Macondo.

Copyright 2011 ABC News Radio

ABC News Radio