British energy giant
( BP) is expected to plead guilty to criminal misconduct for the
2010 Deepwater Horizon disaster and likely to be asked to pay a
record criminal penalty through a plea agreement it has attained
with the U.S. Department of Justice, as reported by Reuters.
The sources also revealed that BP would plead guilty, on the
condition that all future prosecution related to the charges is
abandoned against the company. However, BP and the Justice
Department have not revealed any details in this
BP has been confined to long standing negotiations with the
U.S. government and Gulf Coast states to resolve the civil and
criminal liability claims arising from the April 20, 2010,
tragedy that resulted in a loss of lives of 11 personnel and
polluted four Gulf Coast states. The settlement comprises
billions of dollars in the worst spill in the U.S. history.
However, it remains uncertain as to what form of criminal
misconduct BP will plead guilty to, and the amount it will have
to shell out to resolve the civil charges inflicted upon it by
the Justice Department. It is also uncertain whether the Justice
Department will abandon all the civil charges against the
company, if it pleads guilty.
Previously, BP had always denied all negligence charges. Now
if this is proved wrong the company shall have to pay billions of
dollar as penalties under the Clean Water Act. Earlier, to
resolve the litigations, BP has given $7.8 billion to private
plaintiffs, including individuals and businesses, over the
economic and medical damages from the spill.
However, the reimbursements to be paid by
) remains unclear. These companies provided cementing work on the
well that leaked oil. Per the Justice Department, the mistake
made by BP and Transocean in translating a key pressure test of
the Macondo well clearly points to their negligence.
BP holds a Zacks #3 Rank (Short term Hold rating). Longer
term, we maintain our Neutral recommendation.
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