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Feds block BP from new government contracts

By Stephen C. Webster
Wednesday, November 28, 2012 9:42 EDT
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Two men protest the BP oil spill in New Orleans on May 30, 2010. Photo: Flickr user infrogmation, creative commons licensed.
 
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The U.S. Environmental Protection Agency (EPA) said Wednesday that it has temporarily blocked oil giant BP from winning new contracts from the federal government.

“EPA is taking this action due to BP’s lack of business integrity as demonstrated by the company’s conduct with regard to the Deepwater Horizon blowout, explosion, oil spill, and response, as reflected by the filing of a criminal information,” an agency statement explained.

The company agreed on November 15 to pay a $4.5 billion settlement over criminal charges stemming from the 2010 mega-spill, now ranked the largest accidental oil spill in human history. BP pleaded guilty to 11 felonies, including misconduct and neglect.

Though the fine is the largest ever imposed on a company by the U.S. government, BP still faces billions in additional costs for spill cleanup and environmental restoration.

Two of its well site leaders were also indicted for manslaughter earlier this month. The 2010 disaster killed 11 workers. In addition, BP executive David Rainey was charged with obstructing Congress and making false statements in testimony about the volume of oil his company spilled in the Gulf of Mexico.

“The BP suspension will temporarily prevent the company and the named affiliates from getting new federal government contracts, grants or other covered transactions until the company can provide sufficient evidence to EPA demonstrating that it meets Federal business standards,” the EPA explained in prepared text. “The suspension does not affect existing agreements BP may have with the government.”

BP’s stock price was down nearly 2 percent in early morning trading following the EPA’s announcement.

In a lengthy statement sent to reporters, BP insisted that currently ongoing drilling operations would not be affected, and that the company has made “significant enhancements” since the spill.

“The EPA’s action is pursuant to administrative procedures providing for discretionary suspension until a company can demonstrate ‘present responsibility’ to conduct business with the US government,” the statement said. “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 EPA notified BP that such a draft agreement would be available soon.”

Spokespeople for the EPA and BP did not respond to requests for comment.
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Photo: Flickr user infrogmation, creative commons licensed.

Updated with a statement from BP.

Stephen C. Webster
Stephen C. Webster
Stephen C. Webster is the senior editor of Raw Story, and is based out of Austin, Texas. He previously worked as the associate editor of The Lone Star Iconoclast in Crawford, Texas, where he covered state politics and the peace movement’s resurgence at the start of the Iraq war. Webster has also contributed to publications such as True/Slant, Austin Monthly, The Dallas Business Journal, The Dallas Morning News, Fort Worth Weekly, The News Connection and others. Follow him on Twitter at @StephenCWebster.
 
 
 
 
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