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BP in the dock as US trial begins over Deepwater Horizon oil spill

Oil giant’s chief executive says it is prepared for epic multi-billion dollar corporate trial to last two years

BP goes on trial on Monday over its part in the worst oil spill ever in the US, with the oil giant’s chief executive indicating that it is prepared for the multi-billion dollar case to drag on for two years. BP is accused of ultimate responsibility for the 2010 Deepwater Horizon rig disaster, when an explosion in a well led to the deaths of 11 workers and hundreds of millions of gallons of oil leaking across the Gulf of Mexico.

Barring a last minute settlement, one of the most epic trials in corporate history will start in a New Orleans courtroom with BP potentially facing fines and liabilities of up to bn (£32bn), according to some analyses. BP has set aside bn to deal with the fallout from the spill, and has paid out around bn in compensation to families of victims and others whose livelihoods were affected.

Transocean and Halliburton are also on trial. BP’s chief executive, Bob Dudley – who replaced Tony Haywardafter the disaster – told the Sunday Telegraph: “We have to remember we are a business that invests in decade-long cycles. If (the trial) goes to 2013 or 2014, in the history of BP and the way the energy industry works we just have to think much longer term. “Hopefully we will reach some agreements and we will be able to reduce the uncertainty and move forward. But the appeals process has various different branches it could go down in terms of time so it could be a lot longer than that (2014).” Whether BP settles or not, the case is virtually guaranteed to prove the most expensive environmental disaster in history, far surpassing the Exxon Valdez spill off the coast of Alaska, and any payoff would dwarf previous deals the US government has reached with corporate offenders in any industry (a record that currently stands at .3bn for Pfizer over painkillers).

The blowout on April 20 2010 of the Macondo well killed 11 and injured 17 workers, setting fire to the Deepwater Horizon rig which toppled and sank. Engineers took 85 days to permanently cap the well, by which time leaking oil had spread, endangering fisheries, killing marine life, closing beaches and contaminating more than 900 miles of shoreline.

However, BP denies gross negligence, and says responsibility should be shared with their co-defendants: rig owners Transocean and Halliburton, the firm contracted to seal the well. Mike Brock, a BP trial lawyer, said BP was ready to prove “that no single action, person or party was the sole cause of the blowout.”

The plaintiffs include the federal government, the governments of Louisiana and Alabama and more than 110,000 people and businesses, including large fishing and hotel operations, with claims against the company. There are 340 lawyers from 90 different firms working for the plaintiffs. A key first witness will be Robert Bea, a Berkeley professor specialising in investigating industrial accidents, who was consulted by the White House commission investigating the explosion and has produced four reports faulting BP and its partners for their attitude towards safety, stating that the disaster was preventable.

Dudley said that BP had changed procedures since the accident and now adhered to “the toughest standards”. He said that the new, smaller BP had “turned the corner” after making .9bn annual profits in 2011.

The Sunday Times has reported that BP’s one-time boss Lord Browne may end up controlling some of the North Sea oil fields that Dudley is planning to sell off in the wake of the Deepwater disaster. The paper claims Browne plans to create a new company via Riverstone, the American investment company, with a view to buying BP’s North Sea assets. © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds