US government sues BP for costs of oil spill

A legal hammer-blow was delivered to the British oil giant BP yesterday after the US government sued it and several companies over this year's oil spill in the Gulf of Mexico claiming they had violated American environmental laws and must be held liable for all costs.

It is the first major legal action by the US government in response to the accident that unleashed the worst environmental disaster in American history. It was not unexpected, however, and is likely to be only the first salvo in a protracted campaign in the courts against BP and the other companies connected to the Macondo well.

The British oil company faced further embarrassment last night as a new release of cables from WikiLeaks claimed to reveal details of an incident in Azerbaijan 18 months ago that bore marked similarities to the Gulf disaster. One message said that BP was "quite fortunate to have been able to evacuate everyone safely and to prevent any gas ignition". It is also criticised for an alleged reticence to provide all its information on the blow-out to US authorities and lacklustre security arrangements.

As well as BP, the defendants in the suit included Transocean Ltd, which owned the Deepwater Horizon, the rig at the centre of the disaster, as well as Anadarko Petroleum Corp, Mitsui & Co Ltd unit MOEX and Transocean's insurer, Lloyds of London.

While Halliburton, the US contractor that was responsible for the cementing of the well that, according to preliminary investigations, may have had a role in triggering the disaster, was not named, officials indicated that other defendants could be added to the suit at a later stage.

The suit charges the companies under the Clean Water Act and Oil Pollution Act. "We intend to prove that these defendants are responsible for government removal costs, economic losses and environmental damages without limitation," the US Attorney General Eric Holder said in a statement. Although the suit makes clear that penalties and damages will be sought, no monetary amounts are specified. But the damages arising the Clean Water Act could reach into the billions of dollars.

BP has been moving swiftly to raise funds, partly by the disposal of assets, to prepare itself for penalties which, depending on the final estimate of the amount of oil spilled and the extent to which the courts find that it was negligent, could rise to as much as $21bn (£13bn). The US alleges that BP violated safety and operating regulations in the run up to the 20 April explosion. The suit also cites shortfalls in the construction and monitoring of the well.



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