The Duncan Banner

Local News

July 28, 2013

Halliburton pleads guilty in Gulf oil spill

DUNCAN — Halliburton Energy Services has agreed to plead guilty to destroying evidence and will pay a fine in connection with the 2010 Gulf oil spill.

The Justice Department said in a news release that criminal information charging Halliburton with one count of destruction of evidence was filed in federal court in Louisiana.

Halliburton has agreed to pay the maximum fine, be on probation for three years and continue to cooperate with the government’s criminal investigation, according to the news release, which did not list the amount of the fine.

Questions from The Banner about the plea and fine were directed to the company’s public relations department in Houston.

Halliburton was founded in Duncan by Erle P. Halliburton in 1919 and is one of the world’s largest providers of products and services to the energy industry. It employs 75,000 people worldwide and still has major manufacturing, research and testing facilities in Duncan. As of June 30, the company employed about 2,500 full- and part-time employees in Duncan.

It has dual headquarters in Houston and Dubai.

In connection with the Gulf oil spill, Halliburton has made a $55 million voluntary contribution to the National Fish and Wildlife Foundation. It was not a condition of the court agreement, according to the news release issued Thursday.

The company said in a statement Thursday night that it had agreed to plead guilty “to one misdemeanor violation associated with the deletion of records created after the Macondo well incident, to pay the statutory maximum fine of $200,000 and to accept a term of three years probation.”

The Justice Department has agreed it will not pursue further criminal prosecution of the company or its subsidiaries for any conduct arising from the 2010 spill, Halliburton’s statement said, adding that federal officials have also “acknowledged the company’s significant and valuable cooperation during the course of its investigation.”

The plea agreement is subject to court approval, the company said.

Halliburton was BP’s cement contractor on the drilling rig that exploded in the Gulf of Mexico in 2010. The blowout triggered an explosion that killed 11 workers and spilled millions of gallons of oil into the Gulf.

According to the news release, Halliburton conducted its own review of the well’s design and construction after the blowout, and established a working group to review “whether the number of centralizers used on the final production casing could have contributed to the blowout.”

The casing is a steel pipe placed in a well to maintain its integrity.

Centralizers are metal collars attached on the outside of the casing. Centralizers can help keep the casing centered in the wellbore.

“Centralization can be significant to the quality of subsequent cementing around the bottom of the casing,” the news release said.

Prior to the blowout, Halliburton had recommended to BP the use of 21 centralizers in the well, but BP decided to use six instead, the news release says.

Around May 2010, the news release says, the company directed a program manager to conduct two computer simulations of the Macondo well final cementing job “to compare the impact of using six versus 21 centralizers.”

The simulations indicated there was little difference between using six and 21 centralizers, but the program manager “was directed to, and did, destroy these results,” federal officials say.

Similar evidence was destroyed in a subsequent incident, in June 2010, the Justice Department said.

“Efforts to forensically recover the original destroyed Displace 3D computer simulations during ensuing civil litigation and federal criminal investigation by the Deepwater Horizon Task Force were unsuccessful,” the news release said. “In agreeing to plead guilty, Halliburton has accepted criminal responsibility for destroying the aforementioned evidence.”

In December 2011, BP asked a judge to sanction Halliburton for its handling of cement testing and Displace 3D modeling results. Halliburton claimed that its modeling results were “gone” and couldn’t be found, an explanation that BP attorneys said was “at a minimum, highly suspicious.”

“Purposefully destroying evidence because it is deemed to contain potentially unfavorable information that could benefit a litigation adversary is, by definition, ‘bad faith’ conduct,” they wrote in a court filing.

The plea agreement and criminal charge both arise from a criminal investigation by the Deepwater Horizon Task Force into the spill.

U.S. District Judge Carl Barbier in New Orleans recently presided over a trial in the matter and could decide how much more money BP, Halliburton and rig owner Transocean Ltd. owe for their roles in the catastrophe.

Halliburton and BP have blamed each other for the failure of the cement job to seal the Macondo well.

During the spring trial, BP asked a federal judge to sanction Halliburton for allegedly destroying evidence about the role that its cement slurry design could have played in the blowout.

After the trial started on Feb. 25, Halliburton discovered cement samples at a Lafayette laboratory that weren’t turned over to the Justice Department for testing after the spill. Halliburton lawyers called it a “simple misunderstanding” and accused BP of trying to create a “sideshow.”

Halliburton announced in April that it was trying to negotiate a settlement to resolve a substantial portion of private claims it has faced since the Deepwater Horizon rig blast spawned America’s worst offshore oil spill.

1
Text Only
Local News
  • Council votes for cheaper, quicker water fix

    The Duncan City Council on Tuesday voted unanimously to go with a $650,000 fix to its water infrastructure needs.
    The council approved a $43,000 contract with Crafton, Tull, Sparks and Associates to build a 1,000-foot long pipeline that will be capable of putting about 3 million gallons of water per day into Lake Humphreys.

    April 23, 2014

  • 4-23 DHS Band 0042.jpg DHS band wins fifth straight Sweepstakes

    The Duncan High School band received a rare distinction, winning Sweepstakes for the fifth consecutive year.
    Senior Cody Plumley is excited the band won Sweepstakes for its fifth year in a row, making the DHS Band one of the few school bands to do so.

    April 23, 2014 1 Photo

  • Do the crime, you’ll face a bigger fine

    It just got considerably more expensive to be cruel to animals, ride a bike at night without a light, drive over a fire hose and noodle in a city lake.
    The Duncan City Council on Tuesday voted unanimously to increase the amount of municipal fines and bonds associated with dozens of misdemeanor offenses.

    April 23, 2014

  • Sheriffs: State backing out on prisoner promises

    State efforts to save time and money by shuffling prisoners more swiftly through the system are riling local sheriffs who are losing money because of the efficiency program.
    A change in Department of Corrections practice is landing a “significant hit” on two-thirds of Oklahoma counties, which depend on reimbursements to house state inmates locally, said Ken McNair, executive vice president of the Oklahoma Sheriffs’ Association.

    April 23, 2014

  • McKinney: DOC move will benefit Stephens County jail

    Oklahoma Department of Corrections efforts to move county inmates to DOC prisons has helped the Stephens County Jail dip below capacity.
    But Sheriff Wayne McKinney wonders why it took so long to happen when the county jail was overcrowded for several years.

    April 23, 2014

  • Officer urges volunteers to sign up for mentoring program

    A new in-school mentoring program trying to recruit volunteers got a boost on Tuesday night when Duncan Police Officer Julio Alvarez stepped onto a stage to tell a crowd of 50 spectators that a mentor helped him overcome the trauma of childhood victimization.
    “Go out and spread the word,” Alvarez said, urging people to sign up as mentors through a program that is being developed by The Well Outreach, Inc.

    April 23, 2014

  • 4-23 Assumption 0009.jpg Assumption Catholic to honor Pope John Paul II

    As Pope John Paul II moves toward being named a saint, Assumption Catholic Church will have its own celebration of the former head of the Catholic Church.
    Assumption will have a Divine Mercy Healing Mass at 6 p.m. Sunday to celebrate the canonization of John Paul II. John Paul II was pope from 1978 until his death in 2005.

    April 23, 2014 1 Photo

  • 4-22 Tyee Percival OBIT.jpg Tyee Leon Percival

    April 14, 2009-April 19, 2014

    April 22, 2014 1 Photo

  • City Council to consider airport runway rehabilitation

    A rehabilitation project could be coming to the runway at the Duncan Municipal Airport.

    April 22, 2014

  • High rainfall recorded for Duncan, more expected this week

    Duncan’s rainfall total for 2014 nearly doubled between Sunday night and Monday morning, when the community received 2.06 inches of precipitation.

    April 22, 2014

Poll

Who do you favor for the U.S. Senate seat that Tom Coburn is giving up?

State Rep. T.W. Shannon, R-Lawton
U.S. Rep. James Lankford, R-Edmond
State Sen. Connie Johnson, D-Oklahoma City
Former State Sen. Randy Brogdon, R-Owasso
     View Results
AP Video