Halliburton Pleads Guilty to Destruction of Evidence in Deepwater Horizon Incident

The company also agreed to be on probation for three years and is contributing $55 million to the National Fish and Wildlife Foundation.

The U.S. Justice Department announced July 25 that Halliburton Energy Services Inc. has agreed to plead guilty to destroying evidence in connection with the Deepwater Horizon disaster, with a criminal information charging Halliburton with one count of destruction of evidence that was filed in a federal court in Louisiana.

Halliburton has agreed to the maximum statutory fine, to be subject to three years of probation, and to continue its cooperation in the government's criminal investigation. Halliburton also paid $55 million to the National Fish and Wildlife Foundation "that was not conditioned on the court's acceptance of its plea agreement," according to DOJ.

The blowout occurred April 20, 2010, killing 11 workers and resulting in 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 protruding metal collars affixed at various intervals on the outside of the casing. Use of centralizers 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," according to DOJ’s release. "As detailed in the information, in connection with its own internal post-incident examination of the well, in or about May 2010, Halliburton, through its Cementing Technology Director, directed a Senior Program Manager for the Cement Product Line (Program Manager) to run two computer simulations of the Macondo well final cementing job using Halliburton's Displace 3D simulation program to compare the impact of using six versus 21 centralizers. 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. These simulations indicated that there was little difference between using six and 21 centralizers. Program Manager was directed to, and did, destroy these results. In or about June 2010, similar evidence was also destroyed in a later incident. Halliburton's Cementing Technology Director asked another, more experienced, employee (“Employee 1”) to run simulations again comparing six versus 21 centralizers. Employee 1 reached the same conclusion and, like Program Manager before him, was then directed to 'get rid of' the simulations. 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."

Many agencies are involved in the investigation, including 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.

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