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

21 F. Supp. 3d 657 (2014)

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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
21 F. Supp. 3d 657 (2014)

Facts

BP Exploration and Production, Inc. (BP) (defendant) co-owned the Macondo oil well on the Outer Continental Shelf in the Gulf of Mexico. A mobile offshore drilling unit called Deepwater Horizon conducted drilling activities on the well. Drilling on the Macondo well was extremely difficult, and a decision was made to abandon the well temporarily. In April 2010, abandonment procedures were underway, including placing cement plugs in the well and performing a negative-pressure test. The negative-pressure test simulated the well’s condition after abandonment and assessed whether the cement and casings were structurally sound. A successful negative-pressure test was undisputedly critical to proceeding safely with the abandonment. The negative-pressure test was conducted on April 20, 2010, and resulted in anomalous pressure readings. Despite those readings, BP site leader Don Vidrine concluded that the test had been successful—a conclusion that experts later universally agreed was incorrect. BP senior drilling engineer Mark Hafle advised Vidrine right after the negative-pressure test that the test should not have been considered successful. Nevertheless, the abandonment operation continued. A few hours after the negative-pressure test, a blowout caused explosions and a fire on Deepwater Horizon. Deepwater Horizon sank, and oil began flowing up through the wellbore and into the Gulf of Mexico. The United States (plaintiff) sought a declaratory judgment that BP and other entities were liable for oil-removal costs and damages. The government also sought civil penalties against BP under the Clean Water Act (CWA), which imposed liability on the owner of any vessel or offshore facility from which oil was discharged. On cross-motions for summary judgment, the district court concluded that BP was liable under the CWA because BP owned the well from which the oil had discharged into the Gulf. The court then held a trial to determine, among other things, whether the oil discharge resulted from BP’s gross negligence or willful misconduct, which would result in the imposition of significantly higher penalties under the CWA.

Rule of Law

Issue

Holding and Reasoning (Barbier, J.)

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