British Oil Giant BP to Pay Lesser Fine for Oil Spill

British oil giant BP will pay significantly less then the US$16 billion to US$18 billion in penalties for the 2010 Gulf of Mexico oil spill that the U.S. federal government was seeking will be decided upon a trial that will begin on Jan. 20.

U.S. district judge Carl Barbier ruled on Thursday that slightly over three million barrels were discharged into the Gulf after the rig explosion at BP's Macondo well.  

The three million barrel estimation is less than the four million barrels the Washington estimated and more than BP's two million figure.

The British oil giant also argued that its actions in the wake of the 87-day oil gusher were effective and that the government has overstated the spill's environmental damage.

In his 44-page ruling, Judge Carl Barbier acknowledged "there is no way to know with precision how much oil discharged into the Gulf of Mexico." 

The ruling means that BP can be penalized under the Clean Water Act, but a sanction has yet to be decided. 

The Clean Water Act penalties would be in addition to more than US$42 billion BP has allocated to clean up, compensation and fines. About 810,000 barrels were collected during clean-up.

The second phase of the three-part oil spill trial focused on determining how many barrels were released into the Gulf. It also focused on whether BP was grossly negligent in its source control efforts, and the judge ruled it was not.

The third phase of the trial is scheduled to begin next Tuesday and will determine the amount of the penalty BP will be fined, taking into account the previous rulings. 

Its judicial outcome will have massive implications for the Gulf Coast, because 80 percent of the Clean Water Act civil fines will be provided to the five Gulf states for ecological and economic recovery under the RESTORE Act signed into law in 2012.