As BP Profits Gush Skywards, Deal May Be Cut to Allow BP to Avoid Trial
BP returned to profit with a bang in 2011, revealing Tuesday that it made $24 billion last year as the British energy giant prepares for a criminal trial over the US Gulf of Mexico oil spill disaster.
BP lost $4.9 billion in April 2010 when an explosion on the BP-leased Deepwater Horizon rig killed 11 workers, sent millions of barrels of oil into the sea and left the company with huge compensation costs.
The many lawsuits against BP have been consolidated into one and it is scheduled to go to trial in New Orleans later this month. As the February 27 trial date nears the Sarasota (FL) Herald-Tribune reports on BP's lawyers' "hide-and-stall tactics." However, the New Orleans Time-Picayune reports that negotiators for the Obama administration and the gulf states are trying to avoid a trial by reaching a settlement before the trial even begins.
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Agence France-Presse reports:
The British company and its partners are set to face a trial beginning February 27 in New Orleans that consolidates a host of lawsuits seeking damages for economic losses, injury claims and environmental violations.
The trial also aims to resolve competing claims of liability among BP and its subcontractors, rig operator Transocean and Halliburton, which was responsible for faulty cement work on the Macondo well, whose leak triggered the oil spill.
Commenting on the upcoming case, Dudley said on Tuesday: "As I have said before, we are prepared to settle if we can do so on fair and reasonable terms, but equally, if this is not possible, we are preparing vigorously for trial."
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Florida's Sarasota Herald-Tribune is reporting today:
BP's Attempt to Work in Secret Frightening for Gulf Residents
When BP seeks secrecy, we should be suspicious.
BP has long proved more adept at legal maneuvering than operating safety, but its latest tactics confuse criticism with trade secrets. Its repeated attempts to shield itself from scrutiny should be a reminder of the high cost for allowing it to operate in the shadows.Just last week, a memo surfaced in the federal court case related to the Deepwater Horizon disaster that showed the company sought to keep from the public its estimates of how much oil might gush from the ruptured well. The estimates were far higher than the low-ball estimates it was floating to the public in the face of mounting outrage over what became the worst offshore spill in U.S. history.
So when BP asks a federal judge to suppress information pertaining to possible safety violations at another offshore project, it's a red flag.
Kenneth Abbott, a former BP contractor and 30-year energy industry veteran, sued the company in Houston federal court in 2009, claiming BP didn't complete or document almost 90 percent of the necessary engineering inspections on its massive Atlantis offshore platform in the Gulf of Mexico. [...]
Early in the Abbott case, the judge issued a protective order allowing either side to designate documents or other evidence as confidential. Typically, such orders are used to hide trade secrets or other competitive information. In this case, BP has asked to keep much of Abbott's evidence sealed.
Abbott's attorneys filed a motion accusing BP of using the judicial protection "in an abusive manner, with overbroad blanket confidentiality designations, in an effort to shield this litigation from public scrutiny." [...]
Meanwhile, BP's lawyers are using similar hide-and-stall tactics in the Deepwater Horizon case, set for trial later this month in New Orleans.
They have asked to seal or strike potentially embarrassing evidence related to its Texas City refinery explosion, documents linking employee compensation to cost cutting and portions of former chief executive Tony Hayward's testimony.
They also want to exclude testimony from outside experts who have been critical of the company.
BP has long proved more adept at legal maneuvering than operating safety, but its latest tactics confuse criticism with trade secrets. Its repeated attempts to shield itself from scrutiny should be a reminder of the high cost for allowing it to operate in the shadows.
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The New Orleans-Time Picayune reported Sunday:
Gulf Oil Spill's 'Trial of the Century' Could End Before It Begins
Some leading analysts and legal observers believe the highly anticipated "trial of the century" over the 2010 Gulf of Mexico oil spill, set to begin in three weeks, will end before it starts. BP and negotiators for federal and state governments are frantically working to confect a settlement so they won't have to leave the fate of billions of dollars in potential pollution fines and spill damage payments in the hands of U.S. District Judge Carl Barbier.
"BP cannot be successful if the company is in a legal war with the government that controls drilling leases. Making peace with the federal government is of enormous value to BP's business model."The experts all agree any settlement would have to be a "global settlement" -- one that will resolve federal civil fines under the Clean Water Act, Endangered Species Act and other laws; compensate federal and state governments for damages to natural resources; and settle any criminal violations as well.
A whole other settlement effort deals with the thousands of private claims that are also part of the sweeping litigation, but those claims, expected to amount to a few billion dollars at most, are a relatively small part of the case.
David Uhlmann, a University of Michigan law professor who headed the Justice Department's Environmental Crimes Section for seven years, predicts there's a 70 percent to 80 percent chance that BP will settle with the government before Feb. 27, for both criminal and civil violations, for between $20 billion and $25 billion. [...]
Uhlmann believes it would be foolish for BP to fight a government that also regulates a huge chunk of its business.
"BP decided to continue drilling in the Gulf (after the oil spill) and in fact is looking to expand its footprint in the Gulf," Uhlmann said. "BP cannot be successful if the company is in a legal war with the government that controls drilling leases. Making peace with the federal government is of enormous value to BP's business model."
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