A large plume of smoke rises from fires on BP's Deepwater Horizon offshore oil rig. Gerald Herbert/AP
The Environmental Protection Agency has temporarily suspended the oil and gas conglomerate BP from receiving any new federal contracts, according to a statement released Wednesday.
Citing the environmental disaster following the Deepwater Horizon oil spill in 2010, EPA said BP’s “lack of business integrity” will bar the company from receiving any new contracts with the government until the company meets “federal business standards.” EPA said the government still will adhere to its existing agreements with the company. BP currently has major fuel contracts with the Defense Department
As part of a deal announced in mid-November that settled criminal charges with the federal government, BP will be paying nearly $4.5 billion in damages and could still face civil lawsuits in the future. In a statement released Nov 15, BP said companies “convicted of certain criminal acts can be debarred from contracting with the federal government” but it had not been “advised of the intention of any federal agency to suspend or disbar the company.”
Scott Amey, general counsel at the nonprofit Project on Government Oversight, said EPA’s decision was a necessary step to encourage future corporate responsibility.
“The EPA’s decision sends a message to all government contractors, even large companies, that they will be held accountable if their business practices place taxpayers at risk,” Amey said.
In a statement Wednesday, BP said it has been in “regular dialogue” with EPA and is working with the agency to develop an administrative agreement that would “effectively resolve and lift” the contract suspension.