US: March 3, 2008


NEW YORK - The state of Alaska is planning to sue BP Plc for "several hundred million dollars" to recover oil revenue lost when the major partially shut down the giant Prudhoe Bay oil field because of pipeline leaks in 2006, The Anchorage Daily News reported on Friday.


The suit may be filed as soon as September if settlement talks are unsuccessful, the Daily News reported.

A corroded oil transit pipeline at Prudhoe Bay ruptured in March 2006, spilling more than 200,000 gallons of crude in the worst oil spill on the North Slope.

The spill led to intense scrutiny of BP's operations. Subsequent government ordered inspections found further corrosion problems and a small leak in another oil transit pipeline in August, leading BP to shut half of Prudhoe Bay for more than a month for inspections and repairs.

A BP spokesman declined to comment on the report, although the Daily News quoted a BP Alaska spokesman as saying the company was cooperating with the state.

Alaska lawmakers have inserted a $4.7 million appropriation into the state's 2009 budget to fund the lawsuit.

BP pleaded guilty to a misdemeanor environmental crime in November and paid $20 million in fines to settle all federal and state criminal investigation into the corrosion problems. It was part of a broader effort by the oil major to resolve its US legal problems stemming from a fatal blast at a Texas refinery and accusations of market manipulation in refined oil products.

The plea deal did not include immunity from civil action by the state.

(Reporting by Robert Campbell and Matthew Robinson; editing by Matthew Lewis)


REUTERS NEWS SERVICE