11-29-07 by simpson
BP pleaded guilty today to failing to prevent a huge spill in America’s largest oil field on Alaska’s North Slope. Bumbling Petroleum has agreed to a fine of $20 million for one violation of the Clean Water Act.
The 200,000-gallon spill was caused by reckless cost-cutting that led to a failure to maintain oil pipelines. According to the Associated Press, prosecutors estimate BP saved $9 million by choosing not to regularly clean and inspect to pipelines at the Prudhoe Bay oil field.
Bumbling Petroleum repeatedly denied that a culture of cost-cutting was threatening the 30-year old network of pipes. But after the spill in March 2006, prosecutors found a different story. AP quoted court documents as saying there was “a failure to allocate sufficient resources to ensure safe and environmentally protective operation of the pipelines that leaked.”
Today’s action was part of a larger deal the oil giant cut with the federal government in October. Besides the $20 million for the Alaska spill, BP agreed to pay $353 million in fines and restitution for manipulating markets in the Midwest and killing 15 people in a refinery explosion in Texas.
The estimated savings from cutting back on pipeline maintenance represented less than half of 1 percent of BP’s adjusted net profit of $22 billion in 2006.
And the fines aren’t that big a deal to an oil giant like BP. What it’s going to require to stop this sort of corporate abuse is for some executives to be held accountable for their actions and do hard time in the slammer.