BP working to become eligible for new US government contracts

28 November 2012 23:33  [Source: ICIS news]

HOUSTON (ICIS)--BP is taking steps to remove its suspension from new contracts with the US federal government, the UK oil major said on Wednesday.

BP said it has been in regular dialogue with the US Environmental Protection Agency (EPA), which has imposed the temporary suspension.

It has provided a present responsibility statement of more than 100 pages, and supplemental answers to the EPA's questions based on that submission, the company added.

The EPA has informed BP that it is preparing a proposed administrative agreement that, if agreed upon, would effectively resolve and lift this temporary suspension, the company said. The EPA notified BP that such a draft agreement would be available soon.

BP said its submissions to the EPA have made clear that the company has made significant enhancements since the 2010 Deepwater Horizon accident.

“In the two and a half years since the Deepwater Horizon accident, the US government has granted BP more than 50 new leases in the Gulf of Mexico, where the company has been drilling safely since the government moratorium was lifted,” the company said in a statement.

“Over the past five years, BP has invested more than $52bn [€40bn] in the United States – more than any other oil and gas company, and more than it invests in any other country where it operates. The company employs 23,000 Americans and supports nearly a quarter of a million American jobs,” the company said.

BP claims it has spent more than $14bn in operational response and clean-up costs relating to the Deepwater Horizon accident.

Earlier on Wednesday, the EPA said it imposed the temporary suspension because of BP's alleged "lack of business integrity, as demonstrated by the company's conduct with regard to the [2010] Deepwater Horizon blowout, explosion, oil spill and response, as reflected by the filing of criminal information".

Suspensions are standard practice when a question of responsibility is raised by action in a criminal case, the agency added.

The BP suspension will temporarily prevent the company and its affiliates from getting new federal government contracts, grants or related transactions until the company can provide sufficient evidence to the EPA demonstrating that it meets US federal business standards. 

The suspension does not affect any existing agreements BP may have with the government.

On 15 November, BP agreed to plead guilty to eleven counts of misconduct or neglect of ship officers, one count of obstruction of Congress, one misdemeanour count of a violation of the US Clean Water Act and one misdemeanour count of a violation of the Migratory Bird Treaty Act.

The EPA said the charges were in response to BP’s conduct leading up to the Deepwater Horizon incident, which resulted in the loss of 11 lives and led to the largest environmental disaster in US history,

By: Brian Balboa
+1 713 525 2653

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