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BP pursues claim for costs of Deepwater Horizon accident against contractor Halliburton


BP did not indemnify the company which provided cementing services for the Deepwater Horizon oil rig against the costs of a 2010 explosion which resulted in the largest oil spill in US history, it has said.

In a filing made this week at the federal court in New Orleans, the oil giant rejected US contractor Halliburton's claim that its cementing services contract prevented BP from bringing a claim for damages against the contractor.

The filing, a copy of which has been seen by Out-Law.com, reiterates that BP is seeking the costs and expenses of its clean-up operation in the Gulf of Mexico, loss of profits and "all other costs and damages incurred by BP related to the Deepwater Horizon incident and resulting oil spill".

The company said that "maritime law prohibits indemnification for gross negligence" on the part of Halliburton.

The federal court is expected to begin legal proceedings to establish each company's share of responsibility for the accident in February.

Filing its original claim against the contractor in April last year, BP said that Halliburton's "improper conduct" contributed to the explosion on the Deepwater Horizon. Last month it formally alleged that the contractor had destroyed evidence relating to tests carried out after the explosion.

Halliburton's work was "unstable and unlikely to isolate the hydrocarbons", BP said. However, it added that the company could not have caused the resulting damage without "concealing from BP material facts and expert opinions" about the work, including "its properties, weaknesses and its likelihood of failure".

BP has so far incurred $14 billion in costs directly related to the disaster, but has previously estimated that its total costs will exceed $40bn. It has also established a $20bn fund for individual, business and state claims against it. It has not provided an exact figure for its claim against Halliburton.

In a statement, Halliburton accused BP of "attempting to divert attention from its poor decisions and practices by criticising the work and reputation of Halliburton".

Last year Anadarko Petroleum, which held a 25% interest in the Macondo oil field at the time of the accident, paid $4bn to settle all of BP's current and future claims. The settlement also ended related arbitration proceedings between the two companies. Cameron International, the company which designed and manufactured the blowout preventer on the rig, also made a settlement payment of $250 million.

BP had previously announced settlements with MOEX, which had a 10% interest in the oil field at the time of the explosion, and Weatherford, which provided the drilling equipment.

The company is also bringing proceedings against Swiss company Transocean, which owned and operated the rig on behalf of BP. Transocean has also claimed that BP provided indemnities when the two companies entered into the drilling contract, according to the company's website.

In its internal investigation of the causes of the accident in June 2011, Transocean largely blamed BP for failing to "properly assess, manage and communicate risk" to its partners on the project. The accident was "the result of a succession of interrelated well design, construction and temporary abandonment decisions", many of which were made by BP in its role as operator of the rig, the report said.

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