EPA bans BP from federal contracts after Gulf oil spill

BP's Deepwater Horizon oil spill was the worst in U.S. history, and highlights what the Environmental Protection Agency calls the company's "lack of business integrity."

U.S. Coast Guard

Two weeks after BP pleaded guilty to a number of criminal charges related to the 2010 Deepwater Horizon oil spill in the Gulf of Mexico, federal officials announced they are banning BP from entering into new contracts with the U.S. government.

The U.S. Environmental Protection Agency said it took the action “due to BP’s lack of business integrity,” and that the ban would remain in place until BP proves it can meet federal business standards. That’s good news.

BP’s existing contracts and oil and gas leases remain effective, and the British company will continue to drill in American waters. But the temporary ban is both costly and embarrassing for BP, and it comes after the company was hit with $4.5 billion in fines and penalties related to a fatal drilling rig explosion and the largest oil spill in U.S. history.

Together, the criminal fines and penalties and the ban on federal contracts send a strong message from the federal government: If you want to drill for oil in America’s oceans, you’d better do it responsibly. Let’s hope Shell is paying attention as it looks ahead to 2013 and another attempt to drill in the Arctic Ocean’s Chukchi and Beaufort seas.

The Dutch oil giant says it can operate safely in a remote ocean that has some of the harshest weather conditions in the world. Shell also says it can effectively respond to a spill in the Arctic, despite having no proven technology for recovering the majority of spilled oil.

BP’s spill in the Gulf of Mexico was a human and environmental catastrophe. Eleven workers died in the explosion, and the well blowout spewed crude oil into the ocean for months. Shell is risking its own tragedy off the coast of Alaska.

If a late-season blowout occurred in the Arctic, sea ice could make it impossible to bring a well under control. Oil could continue to be spilled under the ice all winter long. The harm caused to fish, marine mammals, Alaska Native communities and the coastal plain of the Arctic National Wildlife Refuge could be immeasurable.

BP is being punished because its errors in the Gulf of Mexico caused a major tragedy. If Shell and other oil companies drill in the harsh environment of the Arctic – where they have only limited knowledge of geologic conditions – tragedy could easily be repeated.