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BP Liable For Penalties Under the Clean Water Act

According to an AP news report, a federal judge has ruled that BP PLC and a minority partner in the blown out Macondo well are liable for civil penalties under the Clean Water Act for their roles in Gulf of Coast oil spill in 2010. The presiding judge also ruled that Transocean Ltd. may be held liable as an operator under the same law. However, the judge stated he will not be able to make this decision before the trial is set to start on February 27, 2012.

Reportedly, the Justice Department argued that BP, minority partner Anadarko Petroleum Corp. and Transocean are each liable for per-barrel civil penalties for oil discharged from the well. According to legal sources, the judge rejected Anadarko's argument that oil discharged from Transocean's rig, not the well.

Sources say that the judge also ruled that BP and Anadarko, but not Transocean, are "responsible parties" under the Oil Pollution Act for oil that flowed from beneath the surface of the water. Reportedly, Transocean has stated that the ruling is vital win because it clearly shows that BP is the party with which liability ultimately rests.

Reportedly, Anadarko, which owned a 25 percent share in the well, has agreed to pay $4 billion to BP as part of a settlement. Moreover, MOEX Offshore 2007 LLC, BP's other minority partner, agreed last week to pay $90 million in a settlement with the federal government and Gulf states over the spill. Legal sources say the agreement included the largest civil penalty ever recovered under the Clean Water Act, but that record is likely to fall if BP reaches its own settlement with the Justice Department.