BP Alaska to Pay $25 Million Penalty for Alaskan North Slope Oil Spill (HQ)
WASHINGTON – The U.S. Environmental Protection Agency
(EPA), the U.S. Department of Justice and the U.S. Department of
Transportation’s Pipeline and Hazardous Materials Safety
Administration (PHMSA) today announced that BP Exploration Alaska,
Inc. will pay $25 million in civil penalties and implement a
system-wide pipeline integrity management program for spilling more
than 5,000 barrels of crude oil from the company’s pipelines
on the North Slope of Alaska. The penalty is the largest per-barrel
penalty to date for an oil spill.
“Today’s settlement with BP Alaska imposes a tough
penalty and requires the company to take action to prevent future
pipeline oil spills on the Alaska North Slope,” said Cynthia
Giles, assistant administrator for EPA’s Office of
Enforcement and Compliance Assurance. “The Clean Water Act
gives the U.S. authority to assess higher penalties when oil spills
are the result of gross negligence, and this case sends a message
that we intend to use that authority and to insist that BP Alaska
and other companies act responsibly to prevent pipeline oil
spills.”
“This penalty should serve as a wake-up
call to all pipeline operators that they will be held accountable
for the safety of their operations and their compliance with the
Clean Water Act, the Clean Air Act and the pipeline safety
laws,” said Ignacia S. Moreno, Assistant Attorney General for
the Environment and Natural Resources Division of the Department of
Justice. “Companies like BP Alaska must understand that they
can no longer afford to ignore, neglect or postpone the proper
monitoring and maintenance of their pipelines. This agreement will
help prevent future environmental disasters and protect the fragile
ecosystem of Alaska’s North Slope.”
“This penalty is a stern reminder to
pipeline operators to follow orders issued by PHMSA or risk a
federal civil lawsuit and steep fines,” said PHMSA
Administrator Cynthia L. Quarterman. “Also, it is a warning
that operators must know, test and maintain their pipelines or risk
harming people and the environment and having to spend, as in this
instance, hundreds of millions of dollars replacing those
pipelines.”
In March 2006, BP Alaska spilled approximately
5,054 barrels of crude oil on the North Slope in Alaska. A second
spill occurred in August 2006 with approximately 24 barrels of
crude oil spilled. Investigators from EPA and PHMSA determined that
the spills were a result of BP Alaska’s failure to properly
inspect and maintain the pipeline to prevent corrosion. PHMSA
issued a Corrective Action Order to BP Alaska that addressed the
pipeline’s risks and ordered pipeline repair or replacement.
When BP Alaska did not fully comply with the terms of the
corrective action, PHMSA referred the case to the Department of
Justice. Today’s settlement also addresses Clean Air Act
violations arising out of BP Alaska’s improper asbestos
removal along the pipeline in the aftermath of the
spill.
Today’s settlement requires BP Alaska to
develop a system-wide program to manage pipeline integrity for the
company’s 1,600 miles of pipeline on the North Slope based on
PHMSA’s integrity management program. The program will
address corrosion and other threats to these oil pipelines and
require regular inspections and adherence to a risk-based
assessment system. The program will cost an estimated $60 million
over three years and is in addition to the approximately $200
million BP Alaska has already spent replacing the lines that leaked
on the North Slope.
Of the $25 million penalty, $20.05 million will
be deposited in the Oil Spill Liability Trust Fund established
under the Clean Water Act. The remainder, $4.95 million, will be
paid to the U.S. Treasury. The funds paid to the Oil Spill
Liability Trust Fund will be used to finance federal response
activities and provide compensation for damages sustained from
future discharges or threatened discharges of oil into water or
adjoining shorelines. Oil spills are known to cause both immediate
and long-term harm to human health and ecosystems, including the
suffocation of wildlife and the contamination of nesting
habitats.
In 2007, BP Alaska pled guilty to one
misdemeanor violation of the Clean Water Act for the March 2006
spill and was sentenced to three years probation, ordered to pay a
$20 million criminal penalty, including a $12 million fine, $4
million to the National Fish and Wildlife Foundation to support
research and activities on the North Slope and $4 million in
restitution to the state of Alaska.
The consent decree is subject to a 30-day public
comment period and final court approval.
More information on the settlement:
http://www.epa.gov/compliance/resources/cases/civil/cwa/bpnorthslope.html