BP, Halliburton, Transocean Blame Each Other in Testimony on Gulf Spill

BP Plc and contractors Transocean Ltd. and Halliburton Co. are singling out each other for responsibility after the explosion of the Deepwater Horizon rig in the Gulf of Mexico.

“Transocean’s blowout preventer failed to operate,” Lamar McKay, chairman of BP America Inc., said in testimony prepared for a Senate Energy Committee hearing today. Executives representing Transocean, owner of the Deepwater Horizon rig that exploded on April 20, and Halliburton, which provided cement for the oil well, will say BP had the lead decision-making role.

The hearing will be the first examination by Congress of the oil-well blowup. The $365 million Deepwater Horizon rig about 130 miles (209 kilometers) southeast of New Orleans exploded on April 20 and sank two days later. Eleven crew members are missing and presumed dead while the well is leaking an estimated 5,000 barrels of oil a day. The witnesses pledged to cooperate in determining the cause of the spill.

“We intend to do everything within our power to bring this well under control, to mitigate the environmental impact of the spill and to address economic claims in a responsible manner,” McKay said in his testimony.

Halliburton was “contractually bound,” to follow BP’s instructions, Tim Probert, president of global business lines for the Houston-based energy services company, will tell the panel.

“All offshore oil and gas production projects begin and end with the operator,” Stephen Newman, chief executive officer of Swiss drilling company Transocean said in his prepared remarks. BP, the London-based oil company, decided “where and how” its well was to be drilled, Newman said.

Blowout Preventer

The executives debated the significance of the blowout preventer, a device designed to close off a well, that failed to work after the April 20 explosion.

“We are looking at why the blowout preventer did not work because that was to be the fail-safe in case of an accident,” McKay said. The systems are intended to “be fail-safe; sadly, and for reasons we do not yet understand, in this case, they were not.”

Newman of Transocean said “it simply makes no sense” to blame the accident on the blowout preventers because “the drilling process was complete” and the well already “had been sealed with casing and cement.”

Probert of Halliburton said “the final cement plug” to close off the well was never set.

To contact the reporter on this story: Jim Efstathiou Jr. in New York at jefstathiou@bloomberg.net.

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