BP 'to admit criminal misconduct over Deepwater Horizon in plea agreement'

Sources say BP has reached deal with US justice department over 2010 disaster after months of negotiation

BP is expected to plead guilty to criminal misconduct over the 2010 Deepwater Horizon disaster through a plea agreement it has reached with the US department of justice that may be announced as soon as Thursday, according to two sources familiar with discussions.

The sources, who spoke to Reuters on condition of anonymity, said BP would plead guilty in exchange for a waiver of future prosecution on the charges.

BP and the justice department declined to comment.

The oil giant has been locked in months-long negotiations with the US government and Gulf Coast states to settle billions of dollars of potential civil and criminal liability claims resulting from the explosion on 20 April 2010 aboard the Deepwater Horizon rig.

The deal could resolve a significant share of the liability that BP faces after an explosion killed 11 workers and fouled the shorelines of four Gulf Coast states in the worst offshore spill in US history. BP still faces economic and environmental damage claims sought by US Gulf Coast states and other private plaintiffs.

It is unclear to which form of criminal misconduct BP would plead guilty. In an August filing, the department of justice said "reckless management" of the Macondo well "constituted gross negligence and willful misconduct", which it intended to prove at a pending civil trial set to begin in New Orleans in February 2013. The US government has not yet filed any criminal charges in the case.

It is also unclear whether the deal will resolve any civil charges brought by the justice department – and how large a financial penalty BP might pay to resolve the charges, or other punishments that BP might face.

Negligence is a central issue to BP's potential liability. A gross negligence finding could nearly quadruple the civil damages owed by BP under the Clean Water Act to $21bn in a straight-line calculation.

According to the justice department, errors made by BP and Swiss-based Transocean Ltd, owner of the Deepwater Horizon platform, in deciphering a key pressure test of the Macondo well are a clear indication of gross negligence.

"That such a simple, yet fundamental and safety-critical test could have been so stunningly, blindingly botched in so many ways, by so many people, demonstrates gross negligence," the government said in its August filing.

The mile-deep Macondo well spewed 4.9m barrels of oil into the Gulf of Mexico over a period of 87 days. The torrent fouled shorelines from Texas to Florida and eclipsed in severity the 1989 Exxon Valdez spill in Alaska.

BP has already announced an uncapped class-action settlement with private plaintiffs. The company estimates it will cost $7.8bn to resolve litigation brought by over 100,000 individuals and businesses claiming economic and medical damages from the spill.

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