After spill, BP faces scam probe
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Washington/Houston, Aug. 3: BP faces an investigation into whether its employees profited illegally from the Gulf of Mexico spill, as the oil giant prepared on Tuesday to kill the blown-out well for good.
US securities regulators are investigating potential insider trading in shares of BP, including by BP employees, two sources familiar with the probe said.
Analysts said the inquiry showed how the full weight of the government was being brought to bear on BP, which took a $32.2 billion charge related to the spill in its results last week.
BP could face more pressure, however, after US government data showed on Monday almost five million barrels of oil leaked before the well was capped in mid-July, suggesting the company had underestimated the cost by at least $1 billion.
Meanwhile, BP’s 10 per cent partner in the well, Japan’s Mitsui, has yet to decide if it will shoulder any costs, helping the trading house to report a 79 per cent jump in profits to 102.5 billion yen ($1.18 billion).
BP’s other partner in the well, Anadarko Petroleum, which owns a 25 per cent share, is due to report its quarter results shortly.
BP had estimated the well had leaked some four million barrels of oil and that it would be fined $1,100 per barrel under the Clean Water Act. BP faces fines of $4,300 per barrel if gross negligence is proven, but said it saw no need to change its provision as a result of the new estimate.
“Given these new figures, BP could be fined $4.5 billion if gross negligence is not proven or up to $14 billion if it is,” one dealer said.
BP has said it will sell $25-$30 billion of assets to pay for the spill. BP shares traded down one per cent at 8.56 am (GMT). BP was still hoping to attempt the first of two operations to permanently plug the well on Tuesday despite delaying a crucial test on Monday due to a hydraulic leak.
The planned “static kill”, which will involve the injection of drilling mud into the top of the well, followed by the completion of a relief well later in August are seen as the permanent solutions to the leaking well. “It is anticipated that the injectivity test and possibly the static kill will take place Tuesday,” BP said in a statement late on Monday, after US markets had closed.
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