BP fine for Gulf of Mexico spill $4bn lower than expected

Oil giant BP faces a maximum penalty $13.7bn under the Clean Water Act, after the District Court for the Eastern District of Louisiana ruling on the Deepwater Horizon case has found that 3.19m barrels of oil were discharged in the Gulf of Mexico in 2010.

The bill will come as a relief to some BP investors, who had anticipated the penalty to be at least $4bn more.

The ruling put the spill's size below the government's 4.09m estimate and just under the 3.26m estimated by the firm, as some 810,000 barrels were collected during clean-up operations following the worst offshore disaster in US history.

In September 2014, US District Court Judge Carl Barbier ruled that the company had been "grossly negligent", meaning the firm could be fined a statutory limit of up to $4,300 for each barrel spilled, when fines are assessed in the third and final phase of the trial, which is set to begin on 20 January.

BP had sought a "simple negligence" ruling, which would have seen the fines capped at $1,100 per barrel, while Barbier has the power to assign lower per barrel penalties.

Meanwhile, the court has also ruled that BP, which has already set aside $42bn for clean-up, compensation and fines, was not grossly negligent in its source control efforts following the incident.

The firm has sold over $39bn worth of assets since the disaster and news of a somewhat limited fine came as a relief to investors, with BP shares rising about 1% in after-hours trading late on Thursday.