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US bars BP from new oil contracts in wake of Deepwater

Text by News Wires

Latest update : 2012-11-28

The US environmental agency on Wednesday has temporarily suspended oil giant BP from any new federal contracts over what it called the company’s “lack of business integrity” after the Deepwater Horizon disaster in 2010.

The Obama administration put a temporary stop to new federal contracts with British oil company BP on Wednesday, citing the company’s “lack of business integrity” and criminal proceedings stemming from the Deepwater Horizon disaster in 2010.

The action by the Environmental Protection Administration won’t affect current contracts, but prevents BP and its affiliates from new government contracts “until the company can provide sufficient evidence to EPA demonstrating that it meets federal business standards,” the agency said.

“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,” the agency said in a statement.

In London, BP said it had no immediate comment but expected to make a statement later Wednesday.

The EPA suspensions were standard practice when a criminal case raises responsibility questions about a company. The suspension came the same day two BP rig supervisors and a former executive were scheduled to be arraigned on criminal charges stemming from the deadly explosion and the company’s response to the resulting oil spill in the Gulf of Mexico.

BP announced earlier in November that it will plead guilty to manslaughter, obstruction of Congress and other charges and pay a record $4.5 billion in penalties to resolve a Justice Department probe of the disaster. Attorneys for BP and the Justice Department plan to meet with a federal judge in December to discuss a date for pleading guilty.

It was not immediately clear what new or pending contracts the suspension might affect. In the past, BP has been a major supplier of energy to the U.S. military, and has also provided fuel products and drilling services for other U.S. agencies such as the Bureau of Ocean Energy Management.

(AP)

Date created : 2012-11-28

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