DEEPWATER HORIZON" in the § GULF of MEXICO, § SECTION: J on APRIL 20, 2010 § § JUDGE BARBIER Applies To: No
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Case 2:10-md-02179-CJB-SS Document 12043 Filed 12/20/13 Page 1 of 179 UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA IN RE: OIL SPILL by the OIL RIG § MDL No. 2179 "DEEPWATER HORIZON" in the § GULF OF MEXICO, § SECTION: J on APRIL 20, 2010 § § JUDGE BARBIER Applies to: No. 10-2771, § and All Cases § MAG. JUDGE SHUSHAN § § THE ALIGNED PARTIES' PROPOSED PHASE TWO FINDINGS OF FACT NOW INTO COURT, come Plaintiffs, Claimants-in-Limitation, including the State of Alabama and the State of Louisiana, through Plaintiffs' Co-Liaison Counsel, Coordinating Counsel for the States, the Plaintiffs' Steering Committee, and the PSC Phase Two Trial Team; Transocean Offshore Deepwater Drilling Inc., Transocean Holdings LLC, Transocean Deepwater Inc., Triton Asset Leasing GmbH; and Halliburton Energy Services, Inc., and collectively file these Proposed Findings of Fact. PLEADINGS AND EVIDENCE BEFORE THE COURT On September 30, 2013, the Court called this matter for trial. In accordance with Federal Rule of Civil Procedure 52, and based upon the evidence presented during Phase One and Phase Two of this limitations trial, the Aligned Parties propose the following findings of fact. The parties will file separate proposed conclusions of law. The Aligned Parties incorporate herein, as if stated in full, the parties' Stipulated Facts Concerning Source Control Events (Rec. Doc. 7076), filed on August 8, 2012. If the Court determines that any finding of fact is more appropriately a Case 2:10-md-02179-CJB-SS Document 12043 Filed 12/20/13 Page 2 of 179 conclusion of law, the parties respectfully request the Court to consider the "fact" a conclusion of 1 law. 1 Citations to the record are identified as follows: (1) citations to trial testimony are noted by the first initial of the witness's first name, followed by his or her last name, a reference to P1 for Phase One testimony or P2 for Phase Two testimony, then page and line, (e.g., M. Bly, P1 TT 863:1-15); (2) citations to trial exhibits are noted as "TREX- " followed by the exhibit number; (3) citations to demonstrative exhibits are noted as "D-" demonstrative number; and (4) citations to deposition testimony are identified by the first initial of the witness's first name, followed by his or her last name, then page and line (e.g., Depo. of S. Douglas, 93:1-5). In the event the deposition page numbering between volumes is not sequential, the Aligned Parties will identify the requisite volume number as necessary. Citations to any pleadings filed with the Court are identified by record docket number and case number. Case 2:10-md-02179-CJB-SS Document 12043 Filed 12/20/13 Page 3 of 179 TABLE OF CONTENTS I. Phase Two Proceedings .......................................................................................................1 A. Proceedings Leading To The Phase Two Trial........................................................1 B. Phase Two Proceedings. ..........................................................................................2 C. Summary Of Findings..............................................................................................3 II. BP Was In Charge Of And Was Expected To Prepare For Post-Spill Source Control. ....................................................................................................................6 III. BP Held Itself Out As An Industry Leader In Deepwater Drilling....................................11 IV. Knowing The Risk, BP Did Not Prepare For Source Control Of A Deepwater Well Blowout...................................................................................................12 A. BP Knew The Significant Risk Of An Uncontrolled Deepwater Blowout in the Gulf of Mexico Far In Advance Of The Macondo Incident. .......................12 B. BP Failed To Undertake Or Underwrite Any Effort To Prepare For Source Control. BP Had No Plan......................................................................................16 1. BP Spent No Time Planning For, Nor Did BP Have The Necessary Tools For, Deepwater Source Control......................................16 2. BP Spent No Money Developing Source Control Plans, Procedures or Equipment Prior To The Macondo Incident.......................17 3. BP Refused To Provide Any Training On Deepwater Source Control. ....20 V. BP's OSRP And Its January 2010 Deepwater SPU Well Control Response Guide Were Not Source Control Plans..............................................................21 VI. BP's Failure To Have A Source Control Plan In Place Prior To Macondo Resulted In A Substantial Delay In Shutting In The Well.................................................24 A. BP Had To Create A Source Control Plan "On The Fly.".....................................25 B. With Preparation, The Spill Could Have Likely Been Stopped Within Weeks, If Not Days....................................................................................27 VII. BP Should Have Immediately Utilized Some Type Of Capping Device To Stop The Flow Of Oil.......................................................................................29 A. Capping Devices Are Defined Functionally..........................................................29 i Case 2:10-md-02179-CJB-SS Document 12043 Filed 12/20/13 Page 4 of 179 B. BP Knew For More Than Two Decades That Capping Devices Are Best Available Technology For Controlling Deepwater Blowouts. ......................30 C. BP, As Well As Others In The Industry, Has Utilized Capping Devices For Decades And Understood Their Feasibility And Desirability For Well Capping Solutions...............................................................36 D. Landing Capping Devices, Including The One That Shut In Macondo, Is A Routine Operation In The Industry. ..............................................39 E. BP Began Designing Capping Devices Immediately After The Macondo Incident. .................................................................................................40 VIII. BP Ignored The Source Control Experts And Specialists It Assembled. ..........................40 IX. BP's Lack Of Planning Led To Improvised, Failed, Or Misguided Efforts, Wasting Significant Time. ....................................................................................44 X. BP's Failure To Have A Plan In Place Allowed For The "Siloing" Of Information And The Failure To Provide Full Disclosure To Others....................................................44 XI. BP Violated Applicable Regulations Requiring It To Be Prepared To Handle And Respond To A Worst-Case Scenario Blowout. .............................................45 XII. Federal Regulation Required BP To Employ Best Available and Safest Technology......46 XIII. BP Misrepresented And Concealed Its Flow Rate Estimates. ...........................................48 A. BP Admitted In Its Guilty Plea It Withheld High Flow Rate Estimates From The Unified Command. ...............................................................48 B. Unified Command Relied On BP's Representations In Announcing A 5,000 BOPD Flow Rate Estimate. .....................................................................53 C. BP Misrepresented The Flow Rate To Unified Command On May 10.................56 D. BP Misrepresented The Flow Rate To Unified Command On May 19.................60 E. BP Repeatedly And Publicly Misrepresented The Flow Rate As 5,000 BOPD. ....................................................................................................61 F. BP Misrepresented The Flow Rate To National Labs Scientists...........................62 G. BP Misrepresented The Flow Rate To Its Contractors. .........................................64 H. Despite Uncertainties, BP Had The Capability To Model Potential Flow Rates From The Well, And Indeed Did So In Order To Inform Source Control Efforts...........................................................65 ii Case 2:10-md-02179-CJB-SS Document 12043 Filed 12/20/13 Page 5 of 179 I. BP's Internal Modeling Generated Flow Rates Exceeding 5,000 BOPD And Even 15,000 BOPD. .................................................................67 J. BP Employees And Contractors Expressed Concerns Internally About The 5,000 BOPD Estimate..........................................................................71 K. BP Intentionally Concealed Its Flow Rate Estimates, Both Internally And Externally. .....................................................................................73 L. BP Did Not Share Its Internal Estimates And Analyses With Government Officials And Scientists Prior To The Top Kill................................77 M. BP Executives And Employees Acknowledged That They Did Not Share BP's Internal Flow Rate Analyses With Government Officials Or Scientists Prior To The Top Kill.......................................................................82 XIV. Government Officials And Scientists Relied On BP For Flow Rate Information.............84 A. Government Officials And Scientists Did Not Have Access To The Same Amount Or Type Of Information That BP Had....................................84 B. The Internal Flow Rate Analyses That BP Withheld From The Government Were Material Information For Source Control. ..............................84 C. BP's Disclosure Of Certain Worst Case Discharge Estimates Did Not Ameliorate The Harm Caused By Its Failure To Share Numerous Flow Rate Estimates With The Government. ........................................................86 D. Government Officials Did Not Rely On Early Government