Gulf of Mexico oil spill: BP back in court for second phase

Sept. 30, 2013 at 4:17 PM   |   0 comments

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NEW ORLEANS, Sept. 30 (UPI) -- The second phase of BP's civil trial in the Gulf of Mexico oil spill began Monday in New Orleans with lawyers claiming the company failed in its preparations.

At issue is the amount of oil spilled in the gulf after an explosion on the Deepwater Horizon drilling platform. Eleven workers were killed in the blast. BP contends approximately 2.5 million barrels of oil were spilled over 87 days, an estimate the government says is short by about 1.7 million barrels.

After a five-month break, the trial resumed in U.S. District Court with lawyers geared up for a four-day discussion of BP's approach to containing the spill.

"BP's plan was nothing more than a plan to plan," said plaintiffs' attorney Brian Barr in opening statements, adding BP's 600-page disaster plan included only one page addressing the control of a blown-out well, leaving employees unprepared for such a scenario.

Brad Brian, an attorney for Transocean, owner of the Deepwater Horizon drilling rig and an opponent of BP in this part of the case, contended BP underestimated the amount of oil flowing from the broken well, dooming the plan to contain it by attempting to clog it with mud and debris," Brian said.

BP lawyer Brian Brock contended flow rates and conditions were uncertain, noting, "decisions had to be made in the absence of information, and calling the company's well-control plan "consistent with every other operator in the Gulf of Mexico."

BP rejected known fixes to seal the well to mask the rate of oil escaping, the U.S. government says, but the British multinational oil and gas giant argues it made every reasonable effort to cap the well and all its unsuccessful measures were approved by the government while other oil companies agreed with BP's strategy for dealing with what ultimately became a world record off-shore spill.

The U.S. Justice Department and BP are also expected to argue over how much oil leaked into the gulf during the three months it took to cap the well.

The four-week, non-jury trial in federal court in New Orleans could add $18 billion in financial penalties to BP's bill for the disaster, on top of $42.4 billion the company set aside for cleanup.

The U.S. Justice Department is joined now by Transocean and Halliburton, along with the states of Louisiana and Alabama -- known collectively as the "allied plaintiffs."

"But for BP's fraud, the well could have been capped weeks earlier," the filing alleges, contending BP was grossly negligent after the spill as well as before it.

Transocean and Halliburton, seeking to limit their own responsibility in the spill that polluted vast swaths of ocean and beach and devastated wildlife and industry in five gulf states, argue BP could have sealed the well May 15, two months earlier than it was actually capped, but chose not to, The Financial Times reported.

They argue their financial liabilities should therefore stop May 15.

The allied plaintiffs argue BP deliberately underestimated the amount of oil gushing from the well and then delayed the well's sealing hoping to cover up its misrepresentation.

BP made public statements during the spill indicating the well was gushing about 5,000 barrels a day. The Justice Department and the other plaintiffs argue BP knew the flow rate was three times higher than initial claims -- pointing to deleted messages showing BP knew the correct flow rate.

They also allege BP knew its "top kill" plan to restrict the oil flow before sealing it would likely fail, even though BP claimed otherwise. They argue the fact that the "top kill" plan failed was evidence more than 15,000 barrels a day were gushing from the blown-out well.

BP rejects the allied parties' arguments, saying in pretrial motions the claims rely on "sound bites and misrepresentations "and ignore "material facts."

BP says the federal government reviewed and approved its plans to cap the well at every stage and says ExxonMobil Corp., Chevron Corp., Royal Dutch Shell PLC and ConocoPhillips Co. agreed with its capping strategies.

It also says its preparations were in line with the industry's best practices at the time.

The federal government estimates 4.2 million barrels -- 176.4 million gallons -- of crude spewed into the gulf. BP says 2.45 million barrels -- 102.9 million gallons -- spilled, arguing the government's figures come from "unproven methods that require significant assumptions and extrapolations in lieu of ... available data and other evidence."

Both sides agree 810,000 barrels were captured in the spill response.

The penalties under the Clean Water Act are expected to be determined in the trial's third phase next year.

The New York Times reported Sunday the BP could face more than $18 billion in fines if the court supports the government's estimate of 4.2 million barrels of oil spilled.

The first phase of a civil trial concluded April 17 and covered the liability of BP and its partners. Next week the proceedings will turn to determining how much oil leaked into the environment, which will be considered in assessing the fines BP could pay, The (New Orleans) Times-Picayune reported.

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