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BP to pay US government $20.8 billion fine for Gulf oil disaster

A federal judge has approved the $20.8 bn settlement for BP’s oil spill in the Gulf of Mexico. This fine will account for civil claims against the company set forth by the Department of Justice and five Gulf states. US Attorney General Loretta Lynch previously called the settlement “the largest with a single entity in American history.”

An oiled brown pelican near Grand Isle, Louisiana

In September 2014, a federal judge has called major oil company BP (British Petroleum) “reckless”, and oil services giants Transocean and Halliburton “negligent” following the major oil spill of 2010. The US District Judge Carl Barbier has ruled that BP’s “gross negligence” was responsible for the 11 lives which were lost and the 4.9 million barrels (210 million US gal; 780,000 cubic meters).

It’s one of the largest environmental disasters in history, The spill area hosts 8,332 species, and several peer reviewed studies and governmental reports have shown that the environmental damage (both in short and the long run) is inestimable. However, when it comes to fines and lawsuits, everything has to be quantified, and this sum was deemed acceptable by both sides.

BP has reportedly already spent $28 billion on cleanup and compensation, but their measures were nowhere near as effective as predicted. If those figures seem absurdly high, then you need to understand the scale at which BP operates. The company has revenues on the order of hundreds of billions, while their net profit was generally around $10 billion – so the fine is basically their profit for a couple of years. The company reported a net loss of almost $8 billion in 2015, but this includes the cleaning money and a part of the fine. They had several years to prepare for this, and while other companies would have been completely dismantled by such a punishment, BP seems to be able to land on is feet.

Out of the settlement money, $5.5 billion will go toward penalties incurred under the Clean Water Act, most of the money will be given to five states — Alabama, Florida, Louisiana, Mississippi, and Texas — and 400 local government entities to cover damages from the spill.

Disperstants used by BP for oil spill didn’t do much

When British Petroleum (BP) caused the Deepwater Horizon Oil Spill in April 2010, the environmental damage reached gargantuan proportions. The oil company used dispersants, but the technique was actually counter productive, just creating the appearance of the oil going away.

Controlled fire of the BP oil spill. Image via Wiki Commons.

After the 172 million gallon (650 million liter) spill, BP applied a chemical dispersant called Corexit 9500 by plane in order to disperse the oil and help natural microbes to eat the oil faster. The oil appeared to dissipate, and that was deemed sufficient by most people, who didn’t monitor the microbes and chemicals, said University of Georgia marine scientist Samantha Joye.

She thought this was not really satisfying, so she recreated the situation in the lab, using the dispersant, BP oil, and water from the gulf. What she found was that the dispersant didn’t help the microbes at all – if anything, it actually hurt them.

“The dispersants did a great job in that they got the oil off the surface,” Joye said. “What you see is the dispersants didn’t ramp up biodegradation.” In fact, she found the oil with no dispersant “degraded a heckuva lot faster than the oil with dispersants,” Joye said.

In order to be as broad as possible with their lab simulations, she and her team studied the response of almost 50,000 species of bacteria in the Gulf, seeing how they reacted to water with oil, and water with oil and dispersant. The trends were similar for all species: dispersants simply didn’t help, they just created the appearance of helping.

Let’s translate this a bit; after the major oil spill, BP used a substance that prevents big puddles of oil forming on the surface of oceans, but doesn’t do anything to prevent it from spreading to sea life; it made the oil sink, basically.

Not only does Corexit not help, it can actually prevent some microbes from eating the oil, and to make it even worse, it’s actually toxic, and tends to bioaccumulate; but wait, it gets even worse. One paper concluded that the oil hazard was 52 times higher for wildlife due to the use of Corexit, because it broke the oil droplets and made them easier to ingest. So what BP did only made it seem like they’re doing a good thing, when in fact, it made things even worse.

Journal Reference: Chemical dispersants can suppress the activity of natural oil-degrading microorganisms.