BP to pay $25 million penalty over Alaska oil spill

WASHINGTON Tue May 3, 2011 12:12pm EDT

A BP logo is seen on a petrol station in London November 2, 2010. REUTERS/Suzanne Plunkett

A BP logo is seen on a petrol station in London November 2, 2010.

Credit: Reuters/Suzanne Plunkett

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WASHINGTON (Reuters) - BP has agreed to pay a $25 million civil penalty plus interest to settle a federal investigation into a 2006 pipeline oil spill on Alaska's North Slope, according to court papers filed on Tuesday.

The oil spill in Alaska is one of several environmental and safety problems has beset BP in the United States in recent years, including a deadly explosion at an oil refinery in Texas that killed 15 workers and most recently last year's historic oil spill in the Gulf of Mexico.

To address the oil spill in Alaska, the company has "started implementation and operation of some corrective measures, including replacement of the Prudhoe Bay oil transit lines, improved leak detection on the oil transit lines, and improved operation and maintenance of the Pipeline System," the proposed consent decree said.

U.S. officials are expected to announce the settlement later on Tuesday.

BP's stock was down about 1 percent in both New York and London. The fine is small by oil industry standards at just $25 million.

The penalty is the result of BP violating the Clean Water Act when it spilled crude oil in waters on the North Slope of Alaska in the spring and summer of 2006.

The government said the company also violated the Clean Air Act when it improperly removed asbestos-containing materials from its pipelines during the same period.

BP also failed to perform certain corrective actions on its pipelines as ordered by the federal pipeline safety agency.

(Reporting by Jeremy Pelofsky and James Vicini; additional reporting by Tom Doggett; Editing by David Gregorio and Lisa Shumaker)

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Comments (1)
canpie wrote:
25M is a pittance. The proper penalty should be in the 500M range in the light of it’s infamous reputation and disregard for safety and maintenance.

May 03, 2011 12:42pm EDT  --  Report as abuse
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