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MIAMI BEACH - Remember the famous Mexican standoff scene in the movie "Reservoir Dogs" where the gang of crooks turn on each other, hold each other at gunpoint and then shoot each other?
Plaintiff attorney Scott Summy of Baron & Budd in Dallas said it reminds him of the defendants in the Deepwater Horizon oil spill litigation.
They may not be pointing guns, but Summy said BP, Halliburton, Cameron International and Transocean are pointing fingers at each other in an attempt to limit their liability for the April 20 Deepwater Horizon oil rig explosion and leak that spilled millions of gallons of oil in the Gulf of Mexico.
Summy, one of four attorneys appointed to the Plaintiffs' Executive Committee of the BP oil spill multidistrict litigation, made his remarks Nov. 4 at HB Litigation Conferences' Oil in the Gulf - Litigation & Insurance Coverage conference at the Fontainebleau here.
Although "everybody's focused on BP," Summy said that Halliburton did the cement job on the Macondo well, Cameron managed the blow-out preventer (BOP) that failed and Transocean owned the Deepwater Horizon vessel.
"I don't think they can decide among themselves who's liable for what," Summy said.
BP on Sept. 8 released an "independent" report blaming a number of factors and parties, including itself, Halliburton and Transocean, for the April 20 explosion on its Deepwater Horizon deepwater oil drilling rig. Among the findings were that Halliburton's cement job allowed oil and gas to leak out of the well and flow into the rig's drilling parts, that Transocean's crew misread negative pressure tests and failed to realize oil and gas was leaking, and that Cameron's BOP didn't work.
Halliburton and Transocean struck back at their partner in the Deepwater Horizon drilling rig, criticizing the findings of the Sept. 8 BP report that found them equally to blame for the catastrophe. Halliburton said BP, as the well owner, was responsible for well design and testing. Transocean called the BP report self-serving and said BP's cost-cutting decisions increased risks.
"If one party can shift 5 percent of the blame to another party, that's pretty big bucks at the end of the day," Summy said.
On Nov. 8 and 9, the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling will hold a two-day hearing on preliminary findings regarding BP's Macondo well blowout. The commission was formed by President Obama on May 22 to investigate the Deepwater Horizon explosion and develop options for guarding against future oil spills associated with offshore drilling.
Commission Chief Counsel Fred Barlit on Oct. 29 submitted a letter to the commissioners based on his investigations of the Macondo rig explosion.
"We have known for some time that the cement used to secure the production casing and isolate the hydrocarbon zone at the bottom of the Macondo well must have failed in some manner," Barlit wrote. "That cement should have prevented hydrocarbons from entering the well. For a variety of technical reasons that we will explain at the upcoming hearing, BP cemented the well with a nitrogen foam cement recommended and supplied by Halliburton. Halliburton generated the nitrogen foam cement by injecting high pressure nitrogen into a base cement slurry as it pumped that slurry into the well.
Halliburton submitted samples of the materials like those used at the Macondo well, which were then voluntarily tested by Chevron experts. Among the conclusions:
(1) Only one of the four tests that Halliburton ran on the various slurry designs for the final cement job at the Macondo well indicated that the slurry design would be stable.
(2) Halliburton may not have had - and BP did not have - the results of that test before the evening of April 19, meaning that the cement job may have been pumped without any lab results indicating that the foam cement slurry would be stable.
(3) Halliburton and BP both had results in March showing that a very similar foam slurry design to the one actually pumped at the Macondo well would be unstable, but neither acted upon that data.
(4) Halliburton (and perhaps BP) should have considered redesigning the foam slurry before pumping it at the Macondo well.
"Finally, we want to emphasize that even if our concerns regarding the foam slurry design at Macondo are well founded, the story of the blowout does not turn solely on the quality of the Macondo cement job," Barlit wrote. "Cementing wells is a complex endeavor and industry experts inform us that cementing failures are not uncommon even in the best of circumstances. Because it may be anticipated that a particular cement job may be faulty, the oil industry has developed tests, such as the negative pressure test and cement evaluation logs, to identify cementing failures. It has also developed methods to remedy deficient cement jobs.
"BP and/or Transocean personnel misinterpreted or chose not to conduct such tests at the Macondo well."
Halliburton responded the same day, saying the cement mix used on the Macondo well was different than the mix Chevron tested.
"Halliburton believes that significant differences between its internal cement tests and the Commission's test results may be due to differences in the cement materials tested," the company said in a news release. "The Commission tested off-the-shelf cement and additives, whereas Halliburton tested the unique blend of cement and additives that existed on the rig at the time Halliburton's tests were conducted. Halliburton also noted that it has been unable to provide the Commission with cement, additives and water from the rig because it is subject to a Federal Court preservation order but that these materials will soon be released to the Marine Board of Investigation. Halliburton believes further comment on Chevron's tests is premature and should await careful study and understanding of the tests by Halliburton and other industry experts.
"With respect to Halliburton's internal tests, the letter concludes that 'only one of the four tests' showed a stable slurry. Halliburton noted that two of those tests were conducted in February and were preliminary, pilot tests. As noted in the letter, those tests did not include the same slurry mixture and design as that actually used on the Macondo well because final well conditions were not known at that time. Contrary to the letter, however, the slurry tested in February was not 'a very similar foam slurry design to the one actually pumped at the Macondo well. . . .' Additionally, there are a number of significant differences in testing parameters, including depth, pressure, temperature and additive changes, between Halliburton's February tests and two subsequent tests Halliburton conducted in April. Halliburton believes the first test conducted in April is irrelevant because the laboratory did not use the correct amount of cement blend. Furthermore, contrary to the assertion in the letter, BP was made aware of the issues with that test. The second test conducted in April was run on the originally agreed upon slurry formulation, which included eight gallons of retarder per 100 sacks of cement, and showed a stable foam."
"A lot of times things get crazy when defendants start blaming each other, and it's already starting in this case," Summy said before playing the shootout in "Reservoir Dogs" that kills Joe and Nice Guy Eddie and leaves Mr. White and Mr. Orange shot and bleeding.
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