Gulf Spill: BP Loses Ruling

Wednesday, February 1, 2012 @ 04:02 PM gHale

In a blow to BP’s effort to hold partner companies responsible for the Gulf of Mexico oil spill, Halliburton Co is not liable for some pollution claims arising from the 2010 disaster, a federal judge ruled Tuesday.

U.S. District Judge Carl Barbier in New Orleans said BP must compensate Halliburton, which provided cementing services for the Macondo oil well, for third-party compensatory claims under their contract, even if the courts find Halliburton grossly negligent.

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The indemnification relates to claims arising from pollution or contamination that did not originate from Halliburton property located above the land or water.

Halliburton would still be responsible for punitive damages, as well as civil fines under the federal Clean Water Act.

Barbier issued a similar ruling on January 26 that required BP to indemnify Transocean Ltd, which owned the Deepwater Horizon drilling rig, on compensatory damages claims.

That ruling meant BP could not shift more than $15 billion of costs for the spill.

BP spokesman Daren Beaudo said the Halliburton decision sends a “strong signal” that contractors involved in critical well operations will be accountable. He said it means BP’s indemnity “could be void” if Halliburton committed fraud.

Halliburton spokeswoman Beverly Stafford said that company agrees with Tuesday’s decision “to the extent that it requires BP to honor its contractual indemnity obligations.”

Barbier oversees multidistrict litigation over the April 20, 2010, explosion of the Deepwater Horizon.

The accident caused 11 deaths and the largest offshore oil spill in U.S. history. Barbier has set a February 27 start date for a bench trial to apportion blame.

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