BP and Anadarko settle ... now for Halliburton and Transocean

17th Oct 2011 07:23

Integrated oil giant BP and US counterpart Anadarko have reached a settlement over the Deepwater Horizon rig explosion at the Macondo asset in the Gulf of Mexico.Anadarko will pay BP $4bn in a single cash payment, which will go into the $20bn trust fund BP set up to meet individual, business and government claims relating to the tragic incident, as well as the cost of the natural resource damages. Anadarko will also transfer its 25% interest in the MC252 (Macondo) lease to BP.Anadarko had previously accused BP of gross negligence in respect of the Macondo well, but these allegations have now been dropped, and the two parties have agreed to work together with respect to indemnified claims relating to the accident. Anadarko will have the opportunity for a one-eighth participation in future recoveries from third parties or insurance proceeds cumulatively exceeding $1.5bn, up to a total cap of $1bn. Finally, the parties have also agreed to mutual releases of claims against each other. BP has agreed to indemnify Anadarko for certain claims arising from the accident. However, BP's indemnity excludes civil, criminal or administrative fines and penalties, claims for punitive damages, and certain other claims. "This settlement represents a positive resolution of a significant uncertainty and it resolves the issues among all the leaseholders of the Macondo well," said Bob Dudley, BP group chief executive. Dudley noted that all of the owners of the well have now volunteered "to meet their obligations and help fund the economic and environmental restoration of the Gulf," and called on the contractors who worked on the well, including Transocean and Halliburton, to do the same.Multiple official investigations, including those conducted by the Presidential Commission and the Marine Board of Investigation, found that conduct by the contractors contributed to the accident, the BP statement noted. The issuance of regulatory violations last week to BP, Transocean and Halliburton by the US Department of Interior demonstrates that the contractors responsible for well control and cementing, not just the operator, should be held accountable for their conduct, the statement added.--jh