Rowan Wins Against BP in Gorilla V Contract Dispute

Friday, November 16, 2001
Rowan Companies, Inc. reported that the English Court has given a comprehensive judgement in its favor in proceedings between its subsidiary, British American Offshore Limited (BAO) and Amoco (UK) Exploration Company (Amoco). The court found that Amoco's case "fails on the facts at every point", and dismissed in its entirety Amoco's claim that it had been entitled, in January 1999, to terminate its drilling contract with BAO for the use of the jack-up rig Rowan Gorilla V. The court declared that the rig was fit for purpose in all respects when the contract was terminated.

Amoco had refused to commence drilling at the Arbroath platform in January 1999, arguing that much of Gorilla V's equipment was unfit and unsafe. It was BAO's case that the reasons for Amoco's decision to terminate the contract were economic, following a downturn in oil prices and the BP/Amoco merger on January 1, 1999. The court rejected the evidence of Amoco and BP witnesses that the decision was made for safety reasons, or because Amoco had "lost confidence" in BAO. The court criticized Amoco's approach of seeking to exploit any and every argument available concerning Gorilla V when, in fact, no ground for complaint was justified.

The court ordered Amoco to pay all unpaid day rates, damages, interest and an interim payment on account of costs. In total, the Court ordered Amoco to pay in excess of $85 million. Rowan has sued BP, Amoco Corporation and Arbroath co-venturers Amerada Hess and Enterprise in tort in Houston for their involvement in terminating the contract, wrongfully as it has now been determined. The proceedings are set for trial in May 2002.

Gorilla V continues to operate successfully in Canadian waters, where it has completed the drilling of several wells and abandonments. Bob Palmer, Chairman and Chief Executive Officer, commented, "The London court has spoken. For almost three years, Rowan's firmly held position has been that BP made a serious mistake in judgement, a mistake that would prove costly to their reputation and pocketbook. I believe Rowan's reputation as a 'different breed of cat' remains intact. 'Our word is our bond', 'a deal is a deal' and 'fast pay makes fast friends' "Please note that BP has until December 14, 2001 to appeal Justice Langley's decision. So, it is not over -- just yet. The next item on the agenda is the litigation in Houston, which I believe will have meaningful consequences. I relish the prospects."

Maritime Reporter January 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Legal

Zamakona, Finnish GS-Hydro Ink Deal

The presentation ceremony of the Finnish multinational leader in water services GS-Hydro, new partner of Zamakona Yards in Canarias was held yesterday (January 29th at 7 p.

Adani Group Revamps Businesses

Adani Enterprises Limited together with its subsidiaries Adani Ports and Special Economic Zone Limited (“APSEZ”) and Adani Power Limited (“APL”) today announced

PHA Budgets $ 275 mi for Capital Improvements

In 2015, the Port of Houston Authority has budgeted $275 million for various capital improvement projects. About $184 million is being allocated to its container

Container Ships

Imabari to Build 20,000TEU Containerships

Imabari Shipbuilding Co., Ltd. announced it has secured newbuild orders with the cooperation of Marubeni Corporation for 11 units of 20,000TEU Ultra-Large Container Carriers,

Congestion is Port of Long Beach’s Toughest Issue

Slangerup’s State of the Port address outlines goals for Energy Island, smarter supply chain   In his first-ever State of the Port address, Port of Long Beach

Imabari Bags Order for 11 ULCCs

Imabari Shipbuilding Co., Ltd. (Imabari), with the cooperation of Marubeni Corporation, has secured newbuilding order for eleven (11) units of 20,000TEU Ultra-Large Container Carriers,

 
 
Maritime Careers / Shipboard Positions Naval Architecture Offshore Oil Pod Propulsion Port Authority Salvage Ship Electronics Ship Repair Shipbuilding / Vessel Construction Winch
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1836 sec (5 req/sec)