Judge calls for BP to indemnify Transocean in 2010 gulf oil spill

BP PLC is required to indemnify drilling contractor Transocean Ltd., the owner of the Deepwater Horizon semisubmersible drilling rig, against compensatory damages in the Gulf of Mexico oil spill off Louisiana in 2010, according to US District Judge Carl Barbier of New Orleans.

BP was operator of the deepwater Macondo well. An Apr. 20, 2010, blowout resulted in an explosion and fire on the Deepwater Horizon rig. Eleven workers were killed, the semi later sank, and the incident caused a massive oil spill.

Barbier on Jan. 26 granted Transocean partial indemnification in Transocean’s request for a summary judgment (OGJ Online, Nov. 1, 2011).

Transocean said the ruling confirms BP is responsible for economic damages caused by the oil spill.

BP also issued a statement, indicating that it considers the ruling a partial victory for BP. “Under the decision, Transocean is, at a minimum, financially responsible for any punitive damages, fines, and penalties flowing from its own conduct,” BP said. “As we have said from the beginning, Transocean cannot avoid its responsibility for this accident.”

The drilling contractor remains exposed to punitive damages and Clean Water Act fines, analysts noted.

James C. West, an analyst with Barclays Capital in New York, called the ruling a good sign for Transocean.

“We believe the headline is positive and improves Transocean's footing in regards to a settlement with BP,” West said.

Transocean said it was pleased to see its drilling contract indemnification affirmed. Under the contract, BP had responsibility for any pollution from the well.

“This confirms that BP is responsible for all economic damages caused by the oil that leaked from its Macondo well, and discredits BP’s ongoing attempts to evade both its contractual and financial obligations,” Transocean said.

Federal investigators have blamed the incident on multiple causes, saying BP, Transocean, and Halliburton Co. all had some role in the incident although BP bears final responsibility for the spill. Halliburton handled the cementing work on the well.

The National Academy of Engineering and National Research Council said in its final report on the incident that both the industry and regulators misplaced confidence in the ability of blowout preventers (BOPs) to act as fail-safe mechanisms (OGJ Online, Dec. 15, 2011).

A civil trial is scheduled to start in New Orleans on Feb. 27. BP’s attorneys are talking with multiple parties in an effort to reach settlements that would resolve as many issues as possible before that. The companies have countersued each other.

Previously, Cameron International Corp., which manufactured the BOP used on the Deepwater Horizon, agreed to pay a $250 million settlement to BP, and BP agreed to indemnify Cameron for current and future compensatory claims associated with an oil spill (OGJ Online, Dec, 16, 2011).

Contact Paula Dittrick at paulad@ogjonline.com.

Related Articles

Statoil reduces capital budget by $2 billion following 4Q losses

02/06/2015 Statoil ASA has reduced its organic capital expenditure to $18 billion in 2015 from $20 billion in 2014. The move comes on the heels of a fourth qu...

BHI: US rig count down 87 units in 10th straight week of losses

02/06/2015 The US drilling rig count plunged 87 units, a decline that was again spurred mostly by oil rigs, to settle at 1,456 rigs working during the week en...

Oil-price collapse may aggravate producing nations’ other problems

02/05/2015 The recent global crude-oil price plunge could be aggravating underlying problems in Mexico, Colombia, and other Western Hemisphere producing natio...

North Reggane gas project development drilling starts in Algeria

02/05/2015

The North Reggane consortium has started development drilling at its gas project in the Algerian Sahara.

Oil production begins at Nasr Phase-1 offshore Abu Dhabi

02/05/2015 The first phase of Nasr oil field offshore Abu Dhabi will be producing 22,000 b/d by yearend, according to United Arab Emirates news agency WAM.

Woodside lets FEED contract for Greater Western Flank project

02/05/2015 Woodside Petroleum Ltd. has let a contract to Wood Group Kenny for the front-end engineering and design for the flowline system and associated proc...

Deloitte studies oil supply growth for 2015-16

02/04/2015 A Deloitte MarketPoint analysis suggested large-field projects, each producing more than 25,000 b/d, could bring on 1.835 million b/d in oil supply...

Inpex starts development drilling at Ichthys field

02/04/2015

Inpex Corp. has started development drilling in Ichthys gas-condensate field in the Browse basin, about 200 km offshore Western Australia.

BG’s 2015 budget ‘significantly lower than 2014’

02/03/2015 BG Group plans capital expenditures on a cash basis of $6-7 billion in 2015, a range it says is “significantly lower than 2014” due to “a lower oil...
White Papers

Three Tips to Improve Safety in the Oil Field

Working oil fields will always be tough work with inherent risks. There’s no getting around that. Ther...
Sponsored by

Pipeline Integrity: Best Practices to Prevent, Detect, and Mitigate Commodity Releases

Commodity releases can have catastrophic consequences, so ensuring pipeline integrity is crucial for p...
Sponsored by

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New chall...
Sponsored by

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by

Asset Decommissioning in Oil & Gas: Transforming Business

Asset intensive organizations like Oil and Gas have their own industry specific challenges when it com...
Sponsored by

Squeezing the Green: How to Cut Petroleum Downstream Costs and Optimize Processing Efficiencies with Enterprise Project Portfolio Management Solutions

As the downstream petroleum industry grapples with change in every sector and at every level, includin...
Sponsored by

7 Steps to Improve Oil & Gas Asset Decommissioning

Global competition and volatile markets are creating a challenging business climate for project based ...
Sponsored by

The impact of aging infrastructure in process manufacturing industries

Process manufacturing companies in the oil and gas, utilities, chemicals and natural resource industri...
Sponsored by
Available Webcasts


OGJ's Midyear Forecast 2015

When Fri, Jul 10, 2015

This webcast is to be presented by OGJ Editor Bob Tippee and Senior Economic Editor Conglin Xu.  They will summarize the Midyear Forecast projections in key categories, note important changes from January’s forecasts, and examine reasons for the adjustments.

register:WEBCAST


Predictive Analytics in your digital oilfield - Optimize Production Yield and Reduce Operational Costs

When Tue, Jul 7, 2015

Putting predictive analytics to work in your oilfield can help you anticipate failures, plan and schedule work in advance, eliminate emergency work and catastrophic failures, and at the same time you can optimize working capital and improve resource utilization.  When you apply analytic capabilities to critical production assets it is possible to reduce non-productive time and increase your yield.

Learn how IBM's analytics capabilities can be applied to critical production assets with the goal of reducing non-productive time, increasing yield and reducing operations costs.

register:WEBCAST



On Demand

Cognitive Solutions for Upstream Oil and Gas

Fri, Jun 12, 2015

The oil & gas sector is under pressure on all sides. Reserves are limited and it’s becoming increasingly expensive to find and extract new resources. Margins are already being squeezed in an industry where one wrong decision can cost millions. Analyzing data used in energy exploration can save millions of dollars as we develop ways to predict where and how to extract the world’s massive energy reserves.

This session with IBM Subject Matter Experts will discuss how IBM Cognitive Solutions contribute to the oil and gas industry using predictive analytics and cognitive computing, as well as real time streaming for exploration and drilling.

register:WEBCAST


The Alternative Fuel Movement: Four Need-to-Know Excise Tax Complexities

Thu, Jun 4, 2015

Discussion on how to approach, and ultimately embrace, the alternative fuel market by pulling back the veil on excise tax complexities. Taxes may be an aggravating part of daily operations, but their accuracy is crucial in your path towards business success.

register:WEBCAST


Emerson Micro Motion Videos

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected