Anchorage Daily News

JUNEAU -- A congressional committee has launched an investigation into the U.S. Justice Department's handling of recent criminal cases against oil giant BP.

The probe focuses mainly on the case of a Texas refinery explosion in 2005 that killed 15 people and injured more than 170, according to a letter from lawmakers leading the investigation.

But it will touch on the Prudhoe Bay oil spill case that resulted in an Anchorage federal judge sentencing BP's Alaska subsidiary in November to spend three years on probation and pay $20 million in penalties after the company pleaded guilty to an environmental misdemeanor.

Federal prosecutors had announced settlements with BP on the refinery and Prudhoe cases, as well as a Midwest illegal propane trading case, all on the same day -- Oct. 25.

Michigan Democratic Reps. John Dingell, chairman of the House Energy and Commerce Committee, and Bart Stupak, who heads the investigations subcommittee, sent a nine-page letter to Attorney General Michael Mukasey centering on the pending plea agreement in the refinery blast.

The case has generated tremendous publicity in Texas, where many victims argue BP might be getting off too lightly.

The congressmen likewise question whether the proposed penalties are tough enough to act as a deterrent, whether the plea agreement will protect workers, and whether prosecutors adequately consulted with the victims before striking the deal.

The lawmakers also seem interested in the timing and connections among the trio of BP settlements.

Unlike with the Alaska case, a federal judge has yet to approve the refinery plea deal, under which a BP subsidiary would plead guilty to an environmental felony and agree to pay a $50 million fine.

Dingell and Stupak in the past have ripped BP for "severe cost-cutting" and negligence in running the nation's largest oil field, Prudhoe Bay, leading to pipeline corrosion, leaks and a partial field shutdown in 2006.

In their letter Wednesday to Mukasey, the congressmen said that since Oct. 25 when the three BP plea agreements were announced, "this committee ... has been concerned about their adequacy."

They say that at the same time BP executives were cutting costs at the company's Texas City refinery, near Galveston, they were also cutting at Prudhoe Bay, leading to a 201,000-gallon oil spill on the tundra, discovery of widespread corrosion in key pipelines and ultimately a temporary field shutdown.

"This shutdown occurred because BP allowed its oil transit lines to become unserviceable," Dingell and Stupak wrote.

They gave Mukasey 10 days to provide "all communications, including memoranda, e-mails, or letters" within or between the Justice Department and BP attorneys "regarding the possibility of consolidating the press announcement" of the settlements in the Texas refinery, Prudhoe Bay and propane price-fixing cases.

They suggest the proposed $50 million fine in the refinery case is inadequate and equates to "less than a single day of profits for BP in 2006 and 2007."

Nelson Cohen, U.S. attorney for Alaska, said Thursday he couldn't comment on the congressmen's letter.

Ronnie Chappell, a BP spokesman in Houston, also declined to speak to the letter.

"That's between the committee and the Department of Justice," he said.

BP runs the Prudhoe Bay oil field and shares costs with other owners Conoco Phillips, Exxon Mobil and Chevron.

Find Wesley Loy online at adn.com/contact/wloy or call him in Juneau at 1-907-586-1531.

ADVERTISEMENT