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 Today


The Maritime Industry's original and most viewed E-News Service

Maritime Reporter July 2016 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Legal

Samil PwC Okays Hyundai's Management Improvement Plan

Hyundai Heavy Industries (HHI) is notified by Samil PwC, a local member of the global accounting firm PwC, that its 3.5 trillion won worth management improvement

ASEAN Breaks South China Sea Deadlock

Manila drops request to refer to court ruling in statement. Southeast Asian nations overcame days of deadlock on Monday when the Philippines dropped a request

China sets up South China Sea environment protection fund

China has set up a 15 million yuan ($2.25 million) environmental protection fund for the South China Sea having already spent double that in the past four years,

Container Ships

Will Container Lines Skip UK Ports on Brexit?

British importers and exporters prefer direct mainline container services calling at their national ports and tend to dislike feeder services, says a Drewry report.

Port of Rotterdam Throughput Dips in 2016

Compared to the first half of 2015, which saw throughput increased by 6.8 percent, the Port of Rotterdam handled 3 percent less cargo in the first six months of 2016,

Seago Line Introduces New Vessel to Liverpool Service

Maersk subsidiary Seago Line has introduced a new vessel to its recently created feeder service calling at Liverpool. The Independent Accord has already started

 
 
Maritime Careers / Shipboard Positions Maritime Standards Navigation Offshore Oil Pod Propulsion Port Authority Salvage Ship Repair Sonar Winch
rss | archive | history | articles | privacy | 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: 0.0725 sec (14 req/sec)