In re Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico, on April 20, 2010

844 F.Supp.2d 746 (2012)

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In re Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico, on April 20, 2010

United States District Court for the Eastern District of Louisiana
844 F.Supp.2d 746 (2012)

Facts

BP Exploration and Production, Inc. (BP) (defendant) and Anadarko Petroleum Corporation (Anadarko) (defendant) co-leased an area of the Outer Continental Shelf in the Gulf of Mexico and co-owned an oil well on the leasehold. Transocean (defendant) owned and operated a mobile offshore drilling unit (MODU) called Deepwater Horizon, which conducted drilling activities on the well. In April 2010, a blowout at the well caused explosions and a fire on Deepwater Horizon. Deepwater Horizon sank, breaking the riser pipe that had connected Deepwater Horizon to the well. For three months, oil flowed up the wellbore and into the Gulf through Deepwater Horizon’s blowout preventer and remaining riser pipe. The United States (plaintiff) sought a declaratory judgment that BP, Anadarko, and Transocean were jointly and severally liable under the Oil Pollution Act (OPA) for oil-removal costs and damages. Transocean argued that it was not liable under OPA for oil discharge beneath the water’s surface (i.e., subsurface discharge) because Deepwater Horizon was drilling for oil as an offshore facility when the discharge occurred, and the only responsible parties under OPA in that circumstance were the lessees of the area where the facility was located. The government also sought civil penalties against BP, Anadarko, and Transocean under the Clean Water Act (CWA). Anadarko and Transocean recognized that the CWA imposed liability on the owners of any vessel or offshore facility “from which oil [was] discharged,” but they disagreed over the meaning of “from.” According to Anadarko, the oil had been discharged from Deepwater Horizon because it had passed through Deepwater Horizon’s riser pipe immediately before entering the water. Transocean countered that the oil had been discharged from the well because the well was where the flow of oil had originated. The parties cross-moved for summary judgment.

Rule of Law

Issue

Holding and Reasoning (Barbier, J.)

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