BP barred from U.S. contracts

Deepwater Horizon accident

EPA says BP shows lack of business integrity

The EPA has temporarily banned BP from receiving federal contracts, citing a ‘lack of business integrity' due to its role in the 2010 Deepwater Horizon disaster, the U.S. agency announced on 28 November 2012.

The ban prevents the British supermajor from pursuing new opportunities with the U.S., such as the most recent Gulf of Mexico lease sale. Both BP and the EPA stress that this temporary suspension does not affect existing government contracts including current drilling and production operations.

The decision comes two weeks after BP brokered a deal with the U.S. Justice Department, in which BP will pay $4.5 billion in fines and plead guilty to 14 criminal charges. The EPA said that suspensions were standard practice when an individual or company's responsibility is in question.

In its own statement, BP said it has been working with the EPA to establish responsibility. Since the 2010 accident, BP said it has made such strides including management changes and the establishment of a Safety and Operational Risk organization. BP does not believe the suspension will be drawn out.

‘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 supermajor said. ‘The EPA notified BP that such a draft agreement would be available soon.'

Former chief of the Justice Department's environmental crimes section, David Uhlmann, said in an interview with the Los Angeles Times that he expects the ban will expire sometime in 2013 because these types of suspensions allow for the company to fix internal problems and BP has already had two years in which to do so.