Halliburton Guilty Plea in Deepwater Horizon Case

marinelink
Friday, September 20, 2013

Halliburton Pleads Guilty to Destruction of Evidence in Connection with Deepwater Horizon Disaster and Is Sentenced to Statutory Maximum Fine; Former Halliburton Manager Is Charged.
 

Halliburton Energy Services Inc. (Halliburton) pleaded guilty today to destroying evidence pertaining to the 2010 Deepwater Horizon disaster and was sentenced to the statutory maximum fine, the Justice Department announced.

In addition, a criminal information was filed today charging a former Halliburton manager, Anthony Badalamenti, 61, of Katy, Texas, with one count of destruction of evidence.

“These announcements mark the latest steps forward in the Justice Department’s efforts to achieve justice on behalf of all those affected by the Deepwater Horizon explosion, oil spill, and environmental disaster,” said Attorney General Eric Holder.  “Halliburton and one of its managers have now been held criminally accountable for their misconduct, underscoring our continued commitment to ensuring that the victims of this tragedy obtain justice, and to safeguarding the integrity of relevant evidence.  I am grateful to all of the Justice Department leaders, federal investigative agency partners, and state and local allies whose tireless work made this outcome possible – and whose daily efforts will help to prevent such incidents from happening in the future.”

“Halliburton destroyed evidence during the investigation of the largest environmental disaster in U.S. history, and now both the company and the Halliburton manager who ordered the destruction are being held to account,” said Acting Assistant Attorney General Mythili Raman of the Criminal Division.  “I am grateful for the tenacious work of the Deepwater Horizon Task Force prosecutors and investigators who have worked tirelessly on this and other Deepwater Horizon matters to ensure that justice is brought to the people of the Gulf Coast and to the families of the eleven men who perished on April 20, 2010.”

Halliburton’s guilty plea was accepted, and its sentence was imposed, by U.S. District Judge Jane Triche Milazzo of the Eastern District of Louisiana.  During the guilty plea and sentencing proceeding today, Judge Milazzo found, among other things, that the sentence appropriately reflects Halliburton’s offense conduct.  Judge Milazzo also noted that the statutory maximum fine and three year probationary period provide just punishment and appropriate deterrence, and noted Halliburton's self-reporting of the misconduct, substantial and valuable cooperation in the government's investigation, and substantial efforts to recover the deleted data.

According to court documents, on April 20, 2010, while stationed at the Macondo well site in the Gulf of Mexico, the Deepwater Horizon rig experienced an uncontrolled blowout and related explosions and fire, which resulted in the deaths of 11 rig workers and the largest oil spill in U.S. history.  Following the blowout, Halliburton conducted its own review of various technical aspects of the well’s design and construction.  On or about May 3, 2010, Halliburton established an internal working group to examine the Macondo well blowout, including whether the number of centralizers used on the final production casing could have contributed to the blowout.  A production casing is a long, heavy metal pipe set across the area of the oil and natural gas reservoir.  Centralizers are metal devices that protrude from various intervals of the casing strings of a well, which can help keep the casing centered in the wellbore away from the surrounding walls as it is lowered and placed in the well.  Centralization can be significant to the quality of subsequent cementing around the bottom of the casing.  Prior to the blowout, Halliburton had recommended to BP the use of 21 centralizers in the Macondo well.  BP opted to use six centralizers instead.  

As detailed variously in the charging instruments filed against Halliburton and against Badalamenti, during the relevant time period Badalamenti was Halliburton’s cementing technology director.  In May 2010, in connection with Halliburton’s internal post-incident examination of the Macondo well, Badalamenti directed a senior program manager for Halliburton’s Cement Product Line (Program Manager) to run two computer simulations of the Macondo well final cementing job using Halliburton’s Displace 3D simulation program.  Displace 3D was a next-generation simulation program that was being developed to model fluid interfaces and their movement through the wellbore and annulus of a well.  The modeling sought to compare the 21 centralizers Halliburton had recommended to BP versus the six centralizers BP ultimately used.  As detailed in the charging documents, the simulations indicated to those present that there was little difference between using six and 21 centralizers on the Macondo well.  Badalamenti directed Program Manager to destroy these results, and Program Manager did so.

In or about June 2010, similar evidence was also destroyed in a later incident.  Badalamenti asked another, more experienced, employee (“Employee 1”) to run simulations again comparing six versus 21 centralizers.  Employee 1 reached the same conclusion.  Badalamenti then directed Employee 1 to “get rid of” the simulations, and, after a period of delay, Employee 1 deleted them from his computer.

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.

Halliburton’s guilty plea and sentence, and the criminal charge announced today against Badalamenti, are part of the ongoing criminal investigation by the Deepwater Horizon Task Force into matters related to the April 2010 Gulf oil spill.  The Deepwater Horizon Task Force, based in New Orleans, is supervised by Acting Assistant Attorney General Mythili Raman and led by John D. Buretta, who serves as the director of the task force.  The task force includes prosecutors from the Criminal Division and the Environment and Natural Resources Division of the Department of Justice; the U.S. Attorney’s Office for the Eastern District of Louisiana and other U.S. Attorney’s Offices; and investigating agents from:  the FBI; Department of the Interior, Office of Inspector General; Environmental Protection Agency, Criminal Investigation Division; Environmental Protection Agency, Office of Inspector General; National Oceanic and Atmospheric Administration, Office of Law Enforcement; U.S. Coast Guard; U.S. Fish and Wildlife Service; and the Louisiana Department of Environmental Quality.

The case is being prosecuted by Deepwater Horizon Task Force Director Buretta, Deputy Director William Pericak, and Task Force prosecutors Richard R. Pickens II, Scott M. Cullen, Colin Black and Rohan Virginkar.

Maritime Reporter June 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Legal

Kenya Charges 9 Foreigners over Heroin Haul

Nine foreign nationals were charged in a Kenyan court on Thursday with trafficking the biggest ever single seizure of drugs at the Indian Ocean port of Mombasa.

Former MSC Manager Sentenced on Bribes Charges

Former Afloat Programs Manager at the United States Navy Military Sealift Command (MSC), Kenny E. Toy, was sentenced to 96 months in prison for receiving bribes, the U.

FERC Approves Freeport LNG Export Project

U.S. federal regulators on Wednesday approved construction of Freeport LNG Development LP's liquefied natural gas export project in Texas. Freeport is the third U.

Finance

Kurdistan Says Crude Cargo Near Texas Legally Sold

A $100 million cargo of crude oil in a tanker near Texas was legally shipped and sold by Kurdistan, lawyers for the autonomous region in Iraq told a U.S. court in a letter seen on Thursday,

Kirby Reports Record Q2 2014

Record 2014 second quarter earnings per share of $1.31 compared with $1.11 in the 2013 second quarter, which included a $0.07 benefit due to the reduction of the United earnout liability.

UK Oil Imports Exceed Exports for First Time in 30 Years

Britain imported more oil products than it exported last year for the first time in 30 years, an official report shows, and analysts say the country is likely to

Salvage

Family Finds Sunken Treasure Off Florida Coast

A Florida family scavenging for sunken treasure on a shipwreck has found the missing piece of a 300-year-old gold filigree necklace sacred to Spanish priests, officials said on Tuesday.

Grounded Freighter Refloated in Lake St. Clair

The Federal Rideau, a 656-foot freighter that had been hard aground in the downbound shipping channel of Lake St. Clair since early Sunday morning, was refloated

S.Korea Ferry Boss's Driver Turns Self In

The driver of a South Korean businessman wanted over the sinking of a ferry that killed 304 people turned himself in on Tuesday, potentially unlocking the mystery

Casualties

Pumps Reach Sinking Shrimper Just in Time

A commercial fishing vessel from Brownsville is slowly making its way back to port, thanks to some quick actions by its crew and Coast Guard units, informs the US Coastguard,

Company Fined for Oil Spill Near Anacortes

Ecology issues $112,500 penalty for sunken vessel.   American Gold Seafoods faces a $112,500 penalty for an oil spill caused by the accidental sinking of its vessel,

Grounded Freighter Refloated in Lake St. Clair

The Federal Rideau, a 656-foot freighter that had been hard aground in the downbound shipping channel of Lake St. Clair since early Sunday morning, was refloated

People in the News

MNZ Opens New Office in Port Taranaki

Maritime New Zealand (MNZ) informs that for the first time in 5 years it has a permanent presence in New Plymouth on the opening of a new office at Port Taranaki

Former MSC Manager Sentenced on Bribes Charges

Former Afloat Programs Manager at the United States Navy Military Sealift Command (MSC), Kenny E. Toy, was sentenced to 96 months in prison for receiving bribes, the U.

Vale Profit Falls Amidst Record Output

Brazilian miner Vale SA posted a sharp decline in profit from the previous quarter as lower iron ore prices undermined record production of the steel-making ingredient.

Government Update

MNZ Opens New Office in Port Taranaki

Maritime New Zealand (MNZ) informs that for the first time in 5 years it has a permanent presence in New Plymouth on the opening of a new office at Port Taranaki

US DOE Approves Oregon LNG Export Project

The U.S. Energy Department said on Thursday it has approved Oregon LNG to export liquefied natural gas, as the Obama administration works through applications to

UK Oil Imports Exceed Exports for First Time in 30 Years

Britain imported more oil products than it exported last year for the first time in 30 years, an official report shows, and analysts say the country is likely to

 
 
Maritime Careers / Shipboard Positions Maritime Security Maritime Standards Pipelines 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: 0.1413 sec (7 req/sec)