BP Demands Payment from Partners, As Oil From Deepwater Horizon Spill Reaches Texas ShoresJul 6, 2010 | Parker Waichman LLP
With the BP oil spill now in its 77th day, the oil giant is said to be looking to it partners in the Deepwater Horizon endeavor for help in paying the immense costs of the cleanup. Meanwhile, concerns over the extent of the oil spill’s impact continue to grow, after tar balls from the stricken well washed ashore on a Texas beach.
According to a report in The New York Times, BP sent out demands for nearly $400 million to its partners in the well, the Anadarko Petroleum Corporation and the Mitsui Oil Exploration Company of Japan. BP’s contracts with both Anadarko and Mitsui Oil gives each a share of liability equal to each company’s share of ownership. According to the Times, BP owns 65 percent of the Deepwater Horizon well, Anadarko owns 25 percent, and Mitsui 10 percent.
It is unclear, however, if either company will be willing to ante up, the Times said. Already, Anadarko has suggested that BP engaged in “gross negligence” and “willful misconduct” aboard Deepwater Horizon in the days and weeks leading up to the April 20 explosion that took the lives of 11 men and spawned the massive oil spill. If an arbitrator agrees with that assessment, Anadarko will be off the hook.
Mitsui Oil issued a statement saying it was too early to draw conclusions about what happened on the rig, but “as a 10 percent minority nonoperating investor,” the company “is fully cooperating with those investigations.” The a firm has retained outside engineering experts to advise it on the matter, the Times said.
BP has demanded payment from the two companies within 30 days of receipt, but according to the Times, neither would say whether or not a check would be in the mail.
In other news, word came over the holiday weekend that the BP oil spill has now impacted every Gulf Coast state. According to the Houston Chronicle, about a dozen tar balls that washed ashore on Crystal Beach near Galveston were identified yesterday as being from Deepwater Horizon. As late as last week, the U.S. Coast Guard had said the oil spill was not forecast to impact Texas. But the longer the spill continues, the more likely it is that beaches in the state will see some oil.
It is not clear if the gunk made its way into the area on its own, or was brought in on the hull of a ship passing through the BP oil slick. Another possibility is that the tar balls came from ballast water taken on by a ship in the oil slick zone and later dumped in Texas waters.
Meanwhile, a second storm is threatening the cleanup in the Gulf of Mexico. Hurricane Alex had already disrupted skimming and burning operations late last month. This next tropical storm, with a potential track taking it into the Gulf of Mexico, could cause similar disruptions.
Even now, rough seas are hampering some aspects of the clean up, as skimming vessels were unable to operate. The conditions also resulted in an inconclusive test of a massive oil skimmer known as the A-Whale. The mammoth Taiwanese tanker was converted to a skimmer last month when engineers cut holes in its bow and redesigned its tanks. It is hoped that it will be able to skim much as 300,000 barrels of oil-water mixture every 10 hours or so.
But according to The Los Angeles Times, skimming requires calm seas. Testing on the ship is expected to continue.