Halliburton has managed to dodge some of the notoriety that has dogged British Petroleum in the wake of the massive BP oil spill (partly because it was called the BP oil spill and all) but the Houston-based company has still been all wrapped up in lawsuits. Some of those lawsuits may soon be resolved since Halliburton has reached a settlement that -- if approved by the judge overseeing the case -- could clean up the bulk of Halliburton's lawsuits for about $1.1. billion.
For those with short memories, way back in 2010 BP was drilling a well out off the Louisiana coast when there was a massive blowout that killed 11 people and sent millions of barrels of crude oil gushing into the Gulf. It's the largest oil spill in U.S. history, no matter which way you slice it. And officials representing the three companies involved have tried their best to chop things up so they can shoulder the smallest amount of blame possible. BP owned the well, Transocean owned the rig and Halliburton was contracted to do the cement casing -- the one that BP reps in particular have blamed for the spill. Meanwhile, Halliburton folks have been busy blaming BP for the whole thing.
Now $1.1 billion may seem like a ton of money, but it's a pretty small penalty compared to BP, which has shelled out about $28 billion so far and will likely have to pay out billions more before everything is resolved. Transocean, the Swiss company that owned the rig, issued about $1.4 billion in settlements last year. Halliburton will be the company that gets off with the cheapest bill if the new deal is accepted.
It also shows an excellent bit of timing on Halliburton's part - U.S. District Judge Carl Barbier in New Orleans, who is overseeing the oil spill case, may be issuing his ruling on how to dole out the blame for the spill. Halliburton could have ended up paying plaintiffs a whole lot more if company lawyers had sat around waiting to see how things turned out, according to Bloomberg. Whether you think this is fair or not hinges on whether you think Halliburton did indeed do a shoddy job on the cement casings of the well, and whether you think the cement casing mattered. Either way, Halliburton has likely cleared itself of most liability if the judge accepts the deal. Meanwhile, BP issued a rather prickly statement, according to Businessweek, on the Halliburton settlement:
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"The settlement between Halliburton and the [plaintiffs] underscores what every official investigation has found and what the evidence presented during Phase 1 of the Multi-District Litigation trial has shown: that the fire and explosion aboard the Deepwater Horizon was an accident resulting from multiple causes, involving multiple parties. From the beginning, BP has acknowledged its role in the accident, worked to meet its commitments in the Gulf, and called on Halliburton and others to do the same. This settlement marks the very first time-despite three years of official investigations and litigation implicating the company-that Halliburton has acknowledged that it played a role in the accident."