Transocean's $400M Criminal Plea Entered
(CN) - A federal judge on Thursday accepted Transocean's $400 million guilty plea related to its criminal conduct in the Deepwater Horizon disaster.
U.S. District Judge Jane Milazzo imposed the sentence in New Orleans, while a separate settlement that requires Transocean Deepwater to pay $1 billion for violating the Clean Water Act remains pending before U.S. District Judge Carl Barbier.
Transocean, which proposed the $1.4 billion deals in January, had been the owner the Deewater Horizon drilling rig, which exploded on April 20, 2010, killing 11 people and setting off the worst oil spill in U.S. history. The explosion also blew up BP's well, Macondo Prospect, dumping 4.1 million barrels, or 172 million gallons, of oil into the Gulf of Mexico over 87 days.
Of the criminal fines, $150 million will go toward marine, coastal and wildlife conservation. An additional $150 million will be used to fund improved oil spill prevention and response efforts.
The $1 billion civil penalty is expected to break the $70 million record entered last year against MOEX Offshore 2007 LLC, which had been a 10 percent partner with BP in the Macondo well venture. Transocean will apply 80 percent of that penalty to funding environmental and economic projects for Gulf states.
It must also improve the operational safety and emergency response capabilities at all their U.S. drilling rigs under the settlement.
New safety requirements described in the settlement "include certifications of maintenance and repair of blowout preventers before each new drilling job, consideration of process safety risks, and personnel training related to oil spills and responses to other emergencies," the Justice Department said in January.
At the plea hearing in the Eastern District of Louisiana on Thursday, "Transocean admitted that members of its crew onboard the Deepwater Horizon, acting at the direction of BP's well site leaders, known as 'company men,' were negligent in failing to investigate fully clear indications that the Macondo well was not secure and that oil and gas were flowing into the well," the Justice Department announced.
The plea comes on the heels of a $4 billion plea from BP related to its role in the disaster. That amount marks the largest criminal resolution in U.S. history.