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Anadarko Ordered to Pay $159.5M for Gulf Spill

NEW ORLEANS (CN) - Anadarko Petroleum Corp. was ordered to pay $159.5 million for its role as part owner of the Gulf of Mexico well that's failure caused the biggest offshore oil spill in U.S. history.

Anadarko, which owned a 25 percent stake in the ill-fated Macondo well, had argued it should not be fined because it was not to blame for the disaster.

In assessing the fine, U.S. District Judge Carl Barbier acknowledged Anadarko's lack of culpability, pointing out that he could have imposed a fine of as much as $1,100 for each barrel of oil spilled -- which would have brought a penalty of just over $3.5 billion.

Although the company did not directly cause the oil spill, cost cutting measures that were taken by Anadarko and the other well owners, BP and MOEX, contributed to the oil spill, Barbier said in his ruling.

"The court believes punishment and deterrence are the main objectives of the Clean Water Act and are necessary to justify a severe penalty; the remedial and regulatory purposes are secondary," Barbier wrote. "Therefore, Anadarko's lack of culpability weighs more heavily in favor of a low penalty than [the oil spill's] seriousness weighs in favor of a maximum penalty."

He continued: "Although this amount is high when viewed out of context, it is only 4.5% of the maximum penalty, and therefore on the low end of the spectrum. The Court finds that this amount strikes the appropriate balance between Anadarko's lack of culpability and the extreme seriousness of this spill."

Following the April 20, 2010, explosion and sinking of the Deepwater Horizon rig, a mishap that resulted in the deaths of all rig workers, oil gushed into the Gulf of Mexico for near

Although the exact amount of oil spilled will never be conclusively known, previously settled on a figure of 3.19 million barrels of un-captured oil to establish a benchmark for liability.

Clean Water Act fines are assessed after considering numerous factors, one of which is the severity of the disaster. This oil spill, which was the worst in U.S. history and was 12 times larger than the Exxon Valdez spill, was no small thing, Barbier said.

"The seriousness of this violation cannot be overstated. The oil spill was extremely serious. It was gravely serious. It was a massive and severe tragedy," the judge wrote.

Anadarko had very little to do with causing the disaster, but Barbier noted, it also acted only perfunctorily in helping to stop the disaster. And although the company eventually paid out $4 billion to help settle claims arising from the spill, it did so grudgingly.

In a written statement posted on its website, Anadarko said it was pleased the court assessed a relatively small fine, but that it continues "to believe that penalizing a non-operator for events beyond its control is inconsistent with the intent of the Clean Water Act."

Following the spill, BP identified itself immediately as the responsible party and has agreed to pay $1.15 billion in criminal violations under the Clean Water Act, $100 million for violating the Migratory Bird Treaty Act, $5.5 million for 11 counts of seaman's manslaughter for the 11 workers who were killed in the blast, and $500,000 for one count of Obstruction of Congress.

BP also has agreed to pay $350 million to the National Academy of Sciences and $2.394 billion to the National Fish and Wildlife Foundation.

Transocean, as owner of the Deepwater Horizon rig, agreed to pay $1 billion in civil penalties under the Clean Water Act, in addition to $150 million to the National Academy of Sciences and $150 million to the National Fish and Wildlife Foundation.

MOEX, who jointly owned the Macondo well with Anadarko and BP, has paid $45 million federally under the Clean Water Act and $25 million in penalties to the five Gulf States.

Between 2004 and 2010 Anadarko had at least ten other Clean Water Act violations, Barbier's ruling said, most of which he said were minor. The worst fine previously assessed came from Anadarko's alleged discharge of an unknown quantity of oil in Wyoming and Montana.

Court documents unrelated to Barbier's ruling show that between 2003 and 2008 Anadarko and two other companies discharged an estimated 31,300 barrels of oil from Anadarko's facility in Cheyenne Wyoming on more than 35 occasions between 2003 and 2008. The oil went into the tributaries of Silver Tip Creek and Salt Creek and ultimately ended up in the Clarks Fork and Powder Rivers. Anadarko previously agreed to pay $1 million in Clean Water Act penalties for the spills.


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