BP parries with Halliburton over recovery costs for Gulf oil spill

British oil giant BP wants a US judge to force Halliburton to pay all recovery costs stemming from 2010 Gulf oil spill. In a filing Monday, it aims to rebuff assertion that Halliburton bears no liability.

By , Staff writer

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    In this January 2011 photo, officials visit Louisiana's oil-soaked Bay Jimmy. On Monday BP asked a federal judge to order Halliburton to pay for all recovery costs resulting from the 2010 Gulf of Mexico oil spill.
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British oil giant BP is asking a federal judge to force Halliburton to pay for all recovery costs resulting from the catastrophic 2010 oil spill in the Gulf of Mexico.

In a filing made public Monday in federal court in New Orleans, BP accuses Halliburton, a contractor working on the well, of “gross negligence” in decisions involving the cement job meant to seal the Macondo well, the source of the explosion that resulted in 11 deaths and the release of 4.9 million barrels (206 million gallons) of oil into Gulf waters.

According to the court filing, BP wants Halliburton to pay for “the amount of costs and expenses incurred by BP to clean up and remediate the oil spill, the lost profits from and/or diminution in value of the Macondo prospect, and all other costs and damages incurred by BP related to the Deepwater Horizon incident and resulting oil spill.”

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Halliburton, for its part, “stands firm that we are indemnified by BP against losses” resulting from the disaster, spokeswoman Beverly Stafford told CNN in an e-mail Tuesday.

The four-page filing is BP's answer to a lawsuit Halliburton filed in April against it and other companies involved with the Macondo well site. BP had hired Halliburton to cement the well, a technique used in deepwater drilling to stabilize hydrocarbons near the well’s bottom to prevent a blowout. (BP has also filed its own suit against Halliburton and Transocean, the operator of the Deepwater Horizon oil rig.)

Halliburton’s lawsuit charged that BP refused to follow its recommendations involving drilling operations and that BP approved procedures which elevated the risk of a blowout.

Halliburton added that it was contractually indemnified from blame stemming from failures made by other parties, including BP. Because the disaster resulted from the actions of BP employees, Halliburton says, it is not obligated to pay any penalties that result.

In Monday's filing, BP said those claims are inaccurate. BP has long asserted that the disaster is the result of combined actions of all parties involved. In December, it settled a lawsuit with Cameron International, manufacturer of the failed blowout preventer.

Earlier in the year, BP also settled separate lawsuits with Anadarko Petroleum, which had a 25 percent share in the well, and Mitsui & Co., another minority partner, which had a 10 percent stake.

The total BP has raised so far from the three settlements is about $5.2 billion. 

BP’s continued attempts to collect money from ancillary parties comes as it hits the halfway point of the $42 billion fund it is reserving for cleanup costs and recovery in the Gulf region. By the end of November, the company reports, it had spent $21.7 billion. 

BP's costs may well go higher, depending on the outcome of civil trial in federal court in New Orleans, which starts Feb. 27. 

More than 200 lawsuits from alleged victims are being consolidated into a single legal case. The trial will decide liability by BP, Transocean, Halliburton, Cameron International, Anadarko Petroleum, and Mitsui & Co. The trial will also decide the share of the blame each defendant shoulders.

Coordinating plaintiff efforts has been complex, involving 15 law firms and a steering committee. The next scheduled court date for the trial is a status hearing Jan. 19. 

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