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BP to Pay State $255 Million for 2006 Pipeline Spills and Shutdowns


Juneau, Alaska – The State of Alaska won a multi-million dollar arbitration award against BP Exploration (Alaska) Inc. The dispute related to money damages for oil production shortfalls caused by the 2006 pipeline leaks and pipeline replacements in the Prudhoe Bay oilfield. BP admitted liability for purposes of the arbitration, but contended that the State suffered no losses and asked the arbitration panel to award zero damages.

Following a four week hearing in May and June, the three arbitrator panel issued a unanimous decision in favor of the State on October 31. The award is final, binding, and non-appealable. After adjustment for previously agreed upon credits, the final award with prejudgment interest is $245 million; in addition, BP will pay $10 million to settle civil assessments for the spills. In total, BP will pay the State $255 million for the 2006 spills and pipeline shutdowns. 

A copy of the arbitration decision is available at:


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