Bloomberg News

BP Released From Probation in Prudhoe Bay Spill by Judge

January 04, 2012

(Updates with BP comment in sixth paragraph.)

Dec. 27 (Bloomberg) -- BP Plc didn’t violate a plea agreement in a criminal case over a 2006 spill in Alaska’s Prudhoe Bay, a judge ruled, rejecting a request by federal prosecutors to revoke the company’s probation.

BP pleaded guilty in 2007 to violating the Clean Water Act by spilling 200,000 gallons of oil from its Prudhoe Bay field into water on Alaska’s North Slope in 2006. It paid a $12 million fine and $8 million for restitution and community service and was put on three years’ probation.

The government asked U.S. District Judge Ralph Beistline in Anchorage to revoke the probation, saying London-based BP broke the agreement when it spilled about 13,500 gallons of oil near Prudhoe Bay in November 2009. Beistline rejected the U.S. request today and released the company from probation.

“The court certainly cannot fault the government for the position it has taken in this matter for there clearly were reasons for concern,” Beistline wrote in an order. “There can be no doubt that the government takes its responsibility seriously to monitor the industry and to ensure compliance with environmental laws.”

Because the U.S. sought to revoke probation just before it ended in 2010, prosecutors could have sought more money from the company if Beistline had found BP violated the terms.

Company Reaction

“We are pleased with the decision,” Steve Rinehart, BP spokesman, said in an e-mail. “We know that the privilege of working in Alaska comes with a responsibility to maintain high standards. We will continue our commitment to running safe and compliant operations.”

Wyn Hornbuckle, a Justice Department spokesman, didn’t immediately return an e-mail seeking comment.

BP asked the court to reject the U.S. claim and end probation completely. The company didn’t do anything to violate the plea agreement, BP lawyer Jeff Feldman said Dec. 7 in a hearing before Beistline.

“BP conformed to industry standards,” he said.

The 2009 spill occurred when a section of the company’s pipeline at its Lisburne Processing Center ruptured, “creating a two-foot hole in the pipe that allowed the contents to spill onto the tundra and surrounding wetlands,” the government said in a court filing.

Lisburne, a separate field, is part of BP’s greater Prudhoe Bay operation.

The U.S. said BP ignored alarms that warned of the pipe’s eventual rupture and leak. The 2009 leak showed that BP hadn’t yet “addressed the management and environmental compliance problems that have plagued it for many years,” the government said in court papers.

The case is U.S. v. BP Exploration (Alaska) Inc., 3:07-cr- 00125, U.S. District Court, District of Alaska (Anchorage).

--With assistance from Laurel Brubaker Calkins in Houston. Editors: Peter Blumberg, Charles Carter

To contact the reporters on this story: Margaret Cronin Fisk in Detroit at mcfisk@bloomberg.net; Amanda Coyne in Anchorage, Alaska, at To contact the editor responsible for this story: Peter Blumberg at pblumberg1@bloomberg.net.


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