US Coast Guard image

By Margaret Cronin Fisk, Jef Feeley and Laurel Brubaker Calkins

(Bloomberg) — Halliburton Co. may escape paying billions of dollars in damages for its role in the biggest offshore oil spill in U.S. history thanks to statements by a witness for codefendant BP Plc.

Halliburton is accused by victims of the Gulf of Mexico spill, and by codefendant companies including BP, of doing defective work on the Macondo well, scene of the 2010 environmental catastrophe.

Next week, a federal judge will begin hearing evidence in a trial in New Orleans federal court where blame for the disaster will be apportioned among the companies that worked on the well. In pretrial testimony, a witness for U.K.-based BP, which owns the well, testified that Halliburton, which provided cement services, didn’t have a chance to avert the oil rig’s explosion. Instead, he placed potential responsibility on BP and rig owner Transocean Ltd.

The blast might have been avoided if a “well-integrity test” by BP and Transocean hadn’t been misinterpreted, J.J. Azar, BP’s engineering expert, said in a deposition, according to a sealed transcript obtained by Bloomberg News.

The so-called negative-pressure test was supposed to determine whether cementing had sealed off any leaks in the well. It was interpreted as proving the procedure had been successful when it wasn’t, Azar testified.

‘Negative Test’

“If the negative test had been correctly interpreted by BP and Transocean and a determination was made that the cement job was not a good job, remediation work could have been done that would have resulted in this blowout not occurring,” Halliburton’s lawyer Don Godwin said. “Would you agree with that?”

“I would agree with that, sir,” Azar replied.

Azar also agreed with Godwin that BP had the final say on whether the cement job needed to be corrected, according to the deposition.

“My client was not given an opportunity to go in and correct anything that might have been wrong with the cement job because the negative test was misinterpreted,” Godwin said. “Isn’t that a fact, sir?”

“That was a fact,” Azar replied.

The Blowout

The blowout and explosion aboard the rig, the Deepwater Horizon, killed 11 workers and spilled more than 4 million barrels of oil into the Gulf of Mexico. The accident sparked hundreds of lawsuits against London-based BP, Houston-based Halliburton and Vernier, Switzerland-based Transocean.

Azar’s testimony, along with a pre-trial ruling barring victims of the disaster from collecting compensatory damages from Halliburton, may allow it to avoid paying damages, said David Berg, a Houston oil-and-gas litigator not involved in the case who has followed the spill suits.

“There could be a finding of some liability against Halliburton, but I don’t see anything that rises to the level of punitive damages, and that’s the only way that Halliburton has to pay,” Berg said in a phone interview. “Halliburton should walk away from this.”
Halliburton would be liable for only punitive damages stemming from the spill. The contract between the companies tied to the Deepwater Horizon required BP to cover any compensatory damages assessed against Halliburton, U.S. District Judge Carl Barbier, who oversees the spill cases, ruled last year.

Compensatory damages pay victims for losses and injuries. Punitives are used to punish defendants for reckless behavior.

Gross Negligence

Azar’s testimony may make it harder for victims, and codefendants, to prove Halliburton acted with gross negligence, a requirement for punitive damages, said Anthony Sabino, a law professor at St. John’s University in New York who specializes in complex litigation.

“Gross negligence requires a much higher standard” of proof of indifference or “incredibly reckless behavior,” he said.

“The real sticky wicket is when your own expert takes a position that is adverse to you,” Sabino said. “The expert will try to explain
it at trial, but the genie is out of the bottle. It’s well-nigh impossible to change it at trial.”

Azar’s deposition was taken in December 2011 in preparation for his role as a potential BP trial witness. Lawyers for Halliburton and the U.S. Justice Department cross-examined him on the causes of the explosion.

Halliburton took a $300 million charge last year for loss contingencies arising from the multidistrict litigation over the blast and spill.

‘Substantial’ Arguments

“We continue to believe that we have substantial legal arguments and defenses against any liability and that BP’s indemnity protects us,” Halliburton said this month in a filing with the U.S. Securities and Exchange Commission. At the same time, the company said, it “cannot conclude that a probable loss associated with the MDL is zero.”

Beverly Stafford, a spokeswoman for Halliburton, declined to comment on potential liability stemming from the trial.

Halliburton fell 85 cents, or 2 percent, to $40.77 in trading in New York. Halliburton shares have gained 10 percent in the past year.

The plaintiffs injured by the spill claim Halliburton acted with gross negligence in using an inappropriate cement mixture for the well. BP also accused Halliburton of withholding information about the job.

“We believe the evidence will show, consistent with all official investigations, that the accident resulted from multiple causes, involving multiple parties, including Halliburton, who failed to pump a stable cement job,” Scott Dean, a spokesman for BP, said in an e-mailed statement.

The Disaster

Halliburton contends its work wasn’t faulty and said the disaster was caused by BP overriding its advice.
Next week’s trial won’t address the dollar amount of damages to be paid. The proceeding will instead focus on establishing who was at fault, and how much, and whether any of the companies involved in drilling the well acted with gross negligence or reckless indifference.

A second trial on efforts to contain the spill is set for September. One or more trials on damages will follow, barring any out-of-court settlements.

The Feb. 25 trial is the latest in a series of legal chapters spanning the three years since the disaster.

The plaintiffs include businesses, casinos and residents who weren’t part of an earlier $8.5 billion settlement. Also suing are companies claiming damages from the resulting federal moratorium on deep-water drilling prompted by the spill. Additional claims addressed by the trial include those filed by state and local governments, and by the U.S. for civil violations of the Clean Water Act.

Some Settled

All private plaintiffs, including those who settled with BP, as well as state and local governments, are pursuing claims against Transocean and Halliburton. Barbier ruled last year that Transocean didn’t have to pay compensatory damages for spill claims because of the indemnity provision in the drilling contract.

In the criminal case, BP pleaded guilty to 14 federal charges, including 12 felonies, and admitted it misinterpreted the critical pressure test just before the explosion. The U.K. company agreed to pay $4 billion in fines and penalties, plus $525 million to settle an SEC claim that the company underestimated the size of the spill.

BP Settlement

BP settled lawsuits by most non-government plaintiffs in March, agreeing to pay an open-ended amount it most recently estimated at $8.5 billion. The plaintiffs, including many businesses and people harmed by the spill, didn’t settle with Transocean or Halliburton.

Separate from its criminal prosecution, the U.S. government sued BP and Transocean for violations of the Clean Water Act and the Oil Pollution Act, seeking fines, cleanup costs and natural- resources damages. BP and the government agreed that 810,000 barrels of oil wouldn’t be included in Clean Water Act fine calculations, since the company was able to capture it before it entered Gulf waters.

The agreement cut BP’s highest potential government fine by $3.4 billion since each barrel spilled can cost as much as $4,300 under the law, depending on the degree of negligence assigned to BP at trial. BP has denied being grossly negligent.

A finding of gross negligence could lead to a potential maximum civil pollution fine for BP of about $17.6 billion.

Well Partners

The government also sued BP’s partners in the well, Anadarko Petroleum Corp. and Mitsui & Co.’s MOEX Offshore 2007. MOEX settled the lawsuit last year, and Transocean last month settled all but the natural-resources claims.

As part of Transocean’s accord, it pleaded guilty to a misdemeanor Clean Water Act violation and agreed to pay $1.4 billion, including $400 million in criminal penalties.

The U.S. didn’t sue Halliburton, another sign that the company may be able to skirt paying damages, Berg said.

“The very fact the government didn’t come after them is very strong evidence of a lack of liability,” said the lawyer, author of the book “The Trial Lawyer: What It Takes to Win.”

Halliburton was hired to seal the well to prevent leaks with a specialized cement along its sides and bottom. Without this seal, oil or gas in underground rock formations might enter the well, shoot to the surface and cause a blowout.

BP canceled a “cement bond log,” a test of cement integrity, and rejected a Halliburton engineer’s recommendation to use 21 stabilizers to center the drill pipe in the well, Halliburton alleged in court filings. BP officials’ decision to use six stabilizers increased the risk of a leak, Halliburton said.

‘Kick’ in Well

Halliburton claimed BP failed to disclose an oil or gas zone higher in the well than the targeted production area, which prevented the contractor from designing that zone into the final cement job. If the zone wasn’t properly sealed, it could have leaked, Halliburton said in court papers.

Azar, the independent expert hired by BP, testified that Halliburton’s failed cement job was a direct cause of a “kick,” an entry of gas or fluid into the well, which can cause a blowout.

Kicks are well-known on oil drilling projects and can be controlled so they don’t result in blowouts, Azar said. BP and Transocean had a chance to prevent the Macondo well blowout, he said.

“When you detect a kick, you automatically shut in the well,” the engineer testified, referring to a shutdown. “Once you detect anomaly, you shut in a well and then investigate. And it’s not the other way around.”

‘Few Minutes’

Deciding to stop drilling operations was the responsibility of Transocean and BP, and would have taken “a few minutes, maybe less than a minute,” he said.

Criminal allegations against BP and two of its employees center on the results of the negative-pressure test, a check for an increase in the pressure or flow of oil or gas up the well.

BP personnel realized the negative test was unsuccessful less than an hour before the blowout, Azar said when questioned by R. Michael Underhill, a Justice Department lawyer.

Underhill recounted a telephone call between BP engineer Mark Hafle, onshore at BP’s drilling command center, and site manager Donald Vidrine on the day of the blast, April 20, 2010.

“Mr. Vidrine now has information that that negative- pressure test that he has previously approved can’t be considered a successful negative-pressure test based upon what Mr. Hafle told him, according to this document,” Underhill said.

“Correct,” Azar said.

No Alert

Underhill asked Azar if he had evidence that Vidrine or Hafle informed anyone on the rig after the call ended at 9:02 p.m. to alert them about the unsuccessful test and the potential for a blowout.

“No, sir.”

If the driller, Transocean, had been informed that the test was unsuccessful, its personnel could have shut in the well and established control, Azar said.

Underhill asked Azar, who is co-author of the textbook “Drilling Engineering” and former director of the University of Tulsa Drilling Research Projects, what he would have done.

“If I was right there on that rig site and seen that anomaly, I shut the well down, sir,” he said.
At 9:41 p.m. drilling mud shot out of the pipe connecting the rig to the well on the seafloor. The first of two explosions came roughly nine minutes later.

Manslaughter Charges

Vidrine and another site manager, Robert Kaluza, were indicted on federal charges of manslaughter, have pleaded not guilty and are scheduled to go to trial next January.

Halliburton may be assigned some degree of fault for failing to provide results of all lab tests on its cement formula to BP before the job, Berg said.

BP claims the oil-field services company provided only test results showing the cement worked, while other tests indicated the formula could be unstable under certain conditions.

“That’s misleading for them not to have disclosed all the results,” Berg said. “But it hardly rises to willful indifference to the outcome.”

The same principle applies to Halliburton’s failure to independently confirm the results of the third pressure test on Macondo, which BP and Transocean told Halliburton was a success when it wasn’t.

“I might rip them up for that, the failure to double-check the third test,” Berg said. “But I still don’t hear a gross- negligence claim.”

The case is In re Oil Spill by the Oil Rig Deepwater Horizon in the Gulf of Mexico on April 20, 2010, MDL-2179, U.S. District Court, Eastern District of Louisiana (New Orleans).

Copyright 2013 Bloomberg.

(Bloomberg) — Transocean Ltd. and federal prosecutors urged a judge to accept the oil driller’s agreement to plead guilty to a criminal charge over its role in the 2010 Gulf of Mexico oil spill and pay more than $1.4 billion, according to court papers.

Transocean’s willingness to plead guilty to violating federal pollution laws and pay a $400 million criminal fine, along with $1 billion in civil penalties, is a fair resolution of the government’s probe of the drilling firm’s actions in connection with the Deepwater Horizon spill, prosecutors and lawyers for the company said in a 21-page joint court filing today.

“The size and scope of the criminal penalty imposed on Transocean fairly and reasonably balances the seriousness of the spill and its consequences with an assessment of Transocean’s role” in the environmental disaster, lawyers said in the filing.

Transocean was the owner and operator of the Deepwater Horizon oil rig, which burned and sank in the Gulf of Mexico in April 2010 after BP Plc’s Macondo well exploded, setting off the largest offshore oil spill in U.S. history. Under the plea, Transocean also must establish a technology innovation group to focus on drilling safety and devote at least $10 million in funding to the program.

Highest Fine

The explosion aboard Transocean’s drilling rig killed 11 workers and sent millions of barrels of crude oil spewing into the gulf. The accident prompted hundreds of lawsuits against Transocean, London-based BP, the well’s owner, and Houston-based Halliburton Co., which provided cementing services.

Transocean’s criminal fine is the second-highest assessed over an environmental disaster, prosecutors and lawyers for the company said in today’s court filing. The highest was BP’s $1.26 billion fine in connection with the same spill.

BP agreed in November to pay a total of $4 billion to resolve a federal criminal probe of its role in the spill and $525 million to settle the U.S. Securities and Exchange Commission’s claim that the company misled investors about the rate of oil flowing into the gulf. The oil company pleaded guilty to 14 counts, including 11 for felony seaman’s manslaughter.

BP officials said earlier this week the company has spent as much as $8.5 billion on lawsuit settlements related to the spill and is still facing more than $34 billion in claims from U.S. states affected by the environmental disaster.

Responsibility Accepted

Transocean’s misdemeanor plea to one count of violating the Clean Water Act doesn’t cover the company’s exposure for natural-resources damages under the Oil Pollution Act of 1990, according to court filings.

The OPA law requires responsible parties to reimburse both the federal and state governments for the cost of restoring natural resources, such as wetlands, to pre-incident conditions.

Federal prosecutors said in today’s filing that Transocean officials “provided substantial cooperation” with the government’s probe of potential criminal acts tied to the spill.

Company officials contacted a federal task force investigating the incident “within days of its formation and provided continuous and meaningful” information, Justice Department lawyers said in the filing.

Transocean officials said the drilling company “accepts responsibility for the criminal conduct” targeted by the plea, the company’s lawyers said in the filing. The company also has initiated “significant” rig safety and environmental protection programs since the Deepwater Horizon incident, its attorneys added.

Plea Hearing

U.S. District Judge Jane Triche Milazzo will decide Feb. 14 whether to give final approval to Transocean’s plea after a public court hearing. BP’s plea won final approval last month.

Three victims have notified the government of their intent to speak at Transocean’s plea hearing next week, Derek Cohen, deputy director of the Deepwater Horizon Task Force, said in a separate filing today.

The victims include include Buddy Trahan, a Transocean executive who was seriously injured in the rig explosion; Laura Regan, a waterfront property owner claiming medical effects from the spill; and Anh-Dao T. Nguyen of the Southeast Asian Fisherfolk Association, which represents immigrant seafood- industry workers on the Gulf.

The criminal case is U.S. v. Transocean Deepwater Inc., 13- cr-001, U.S. District Court, Eastern District of Louisiana (New Orleans).

- Jef Feeley and Allen Johnson Jr., Copyright 2013 Bloomberg.

A Bourbon Street balcony during Mardi Gras. Photo (c) Alex Demyan

(Bloomberg) — The trial over liability for BP Plc’s 2010 Gulf of Mexico oil spill was postponed to Feb. 25 so the lawyers won’t lose their accommodations to Super Bowl and Mardi Gras crowds, a New Orleans judge said.

The Super Bowl, the National Football League’s title game, is set for Feb. 3, and the last day of Mardi Gras, the pre- Lenten festival, is Feb. 12. The trial, originally set for Jan. 14, will be delayed six weeks because lawyers involved have been told they’ll be “kicked out” of their hotel rooms, U.S. District Judge Carl Barbier said at a hearing today.

“It makes no sense to try and start the trial Jan. 14 then suspend it,” Barbier said. “We don’t want to ruin everybody’s holidays.”

Scott Dean, a BP spokesman, declined to comment on the change in trial date.

“The day of judgment is coming,” Steve Herman, an attorney for the plaintiffs, said today. “A few weeks of delay isn’t going to matter.”

The April 2010 sinking of the Deepwater Horizon rig set off the largest offshore oil spill in U.S. history and led to hundreds of lawsuits brought against London-based BP, owner of the well, and its partners in the project.

Economic Loss

BP agreed in March to pay an estimated $7.8 billion to resolve most private plaintiffs’ claims for economic loss, property damage and injuries. The settlement, reached days before a scheduled trial on liability for the 2010 spill, didn’t cover federal government claims and those of the Gulf Coast states.

It also didn’t cover lawsuits against Transocean Ltd., the Vernier, Switzerland-based owner and operator of the rig; and Houston-based Halliburton Co., which provided cementing services. BP’s settlement excluded claims by financial institutions, casinos, private plaintiffs in parts of Florida and Texas, and residents and businesses claiming harm from a drilling moratorium.

Barbier will conduct a fairness hearing on the $7.8 billion settlement Nov. 8. Objections to the settlement have to be filed by Nov. 1.

Barbier will consider fault for the explosion and subsequent spill at the nonjury trial now set in February. He will also determine whether BP or other defendants were grossly negligent in their actions setting off the spill.

Potential Fines

A finding of gross negligence could raise the potential fines for violations of the Clean Water Act from $1,100 a barrel to $4,300 a barrel. The U.S. has claimed that more than 4 million barrels of oil were spilled before the well was capped.

The U.S. sued BP, Transocean and BP’s partners in the well, Mitsui & Co.’s MOEX Offshore 2007 and The Woodlands, Texas-based Anadarko Petroleum Corp., alleging violations of federal pollution laws. MOEX has settled the federal claims.

BP has been in negotiations with the U.S. Justice Department to settle the pollution suit, according to a person familiar with the matter. Dean declined to comment.

These negotiations may not avert a trial, Louisiana Attorney General Buddy Caldwell said today.

“The way everybody’s talking, they’re revving up for a trial,” he said in an interview outside the courtroom. “Louisiana is not negotiating with BP at this time.”

Criminal Trial

The trial on liability for the 2010 spill is now set to begin the same day as a criminal trial against a former BP engineer charged with destroying evidence sought for a U.S. probe.

The jury trial of Kurt Mix, who was charged with two counts of obstruction of justice for allegedly deleting text-message strings from his mobile phone, is scheduled to start Feb. 25 in New Orleans federal court before a different judge.

Mix, who has pleaded not guilty, worked on internal BP efforts to estimate the amount of oil leaking from the Macondo well.

The lawsuits are in In Re Oil Spill by the Oil Rig Deepwater Horizon in the Gulf of Mexico on April 20, 2010, MDL- 2179, U.S. District Court, Eastern District of Louisiana (New Orleans). The criminal case is U.S. v. Mix , 12-cr-00171, U.S. District Court, Eastern District of Louisiana (New Orleans).

Mark Hafle, BP’s Senior Drilling Engineer, image: US Coast Guard

(Bloomberg) — The refusal of three BP Plc executives’ to testify about the 2010 Gulf of Mexico disaster should be held against the company at a multibillion-dollar trial over liability for the worst offshore oil spill in U.S. history, prosecutors said.

(US Coast Guard Photo)

HOUSTON–A dispute over the authority of U.S. accident investigators heads to federal court here Wednesday, in a case pitting the U.S. Chemical Safety Board against Transocean Ltd., the owner of the Deepwater Horizon drilling rig.

The House Energy and Commerce Committee asked the board, which investigates industrial accidents, to investigate the explosion aboard the Deepwater Horizon two years ago that killed 11 workers and unleashed a massive offshore oil spill.

But Transocean says the agency has no powers offshore in the Gulf of Mexico and has been ignoring its subpoenas. Last October, the Justice Department filed suit against the company on behalf of the board. Arguments in the case will be heard Wednesday afternoon.

If the courts affirm the agency’s jurisdiction, the board is likely to become more involved in offshore oil and gas installations. The board, which doesn’t issue regulations, now conducts investigations onshore. Offshore operations are regulated by the U.S. Coast Guard, the Department of Interior and the Environmental Protection Agency.

The chemical board says it has a role to play in the aftermath of Deepwater Horizon, because it is focusing on the explosion aboard the rig, not the subsequent spill or its environmental impact. The investigator in charge of the case, Donald Holmstrom, led the probe into the 2005 blast at BP PLC’s Texas City refinery.

The board says its purview extends to federal waters because the Transocean rig and the well it drilled for BP were a large industrial operation in an area that is indisputably a U.S. territory.

Although the chemical board cannot impose rules on companies, “they do have a strong bully pulpit,” said George Wilkinson, a lawyer with the Houston-based law firm Vinson & Elkins, who isn’t involved in the dispute.

Starting in mid-2010, the agency began asking Transocean for documents describing its safety practices, worker schedules, rig designs and management processes, and sought to interview key witnesses.

Unlike most other companies involved in the incident, Transocean declined to provide requested information except contact information for lawyers representing Transocean employees, the agency’s managing director, Daniel Horowitz, said in an interview.

Mr. Horowitz said that “the CSB investigation will go deeper into issues of major accident prevention,” seeking to establish what sort of industrial standards and procedures should apply to the offshore-drilling industry.

Transocean has declined to comment publicly on the case. But it said in court filings that it “should not be subjected to the burden of responding to the CSB’s subpoenas,” especially when other agencies have thoroughly investigated the accident.

-By Angel Gonzalez, The Wall Street Journal

Copyright © 2012 Dow Jones & Company, Inc.

By Tom Fowler and Angel Gonzalez

BP PLC is alleging that Halliburton Co. destroyed evidence in the weeks following the Deepwater Horizon explosion in 2010 that demonstrated that the cement formula the firm used on the drilling operation was flawed.

The claim, made Monday in a federal civil-court filing in New Orleans, is the latest in a continuing volley of accusations between the companies as they face potentially huge civil and criminal penalties stemming from the 2010 accident in the Gulf of Mexico that killed a total of 11 people and led to the largest offshore oil spill in the U.S. history.

Halliburton has previously said that it believes the cement mix it recommended that BP use on the well was stable. It has argued that the well failed because of poor engineering and design choices made by BP.

BP argued in its filing that Halliburton conducted tests following the April 20, 2010, accident that determined that the same cement formula used on the Deepwater Horizon well did have problems.

A Halliburton spokeswoman said Monday that BP’s claims were “without merit, and we look forward to contesting their motion in court.”

According to depositions in a collection of civil lawsuits that are set to go to trial in February, a Halliburton technician in the company’s Duncan, Okla., research lab said he recreated the cement formula in late April or early May 2010 and found it to be “thin,” and not suitable for the job.

The employee testified he threw out the test results and didn’t put his conclusions in writing to a supervisor, because he was concerned they could be “misinterpreted” and his word “twisted and turned,” according to the filings.

Halliburton also created a computerized model of the well cement job after the accident that found that BP’s well design did not create the problems that Halliburton attributed to BP, according to the filing by BP on Monday.

BP claims Halliburton failed to provide records of the tests during the legal discovery process, and later told BP officials that data collected and materials used in the testing had been thrown out.

BP is asking a federal judge to sanction Halliburton for misconduct. It also demanded that a computer used for the analysis be turned over to an independent forensic testing firm.

In September, Halliburton made accusations of its own, saying that BP hid key information about the well in the Deepwater Horizon accident that could have prevented it. BP has denied that claim.

(c) 2011 Dow Jones & Company, Inc.

AP Photo/Pablo Martinez Monsivais

WASHINGTON (Dow Jones)–The chief executives of BP Plc (BP, BP.LN), Transocean Ltd. (RIG) and Halliburton Co. (HAL) declined to testify this week before a panel of House lawmakers who are looking into the causes of the Deepwater Horizon oil spill.

The move has a key Democrat vowing to take measures to compel the executives to appear.

The CEOs of all three companies–BP’s Robert Dudley, Transocean’s Steven Newman and Halliburton’s David Lesar–were asked to testify this week at a hearing of the House Natural Resources Committee.

That committee, led by Rep. Doc Hastings (R., Wash.), is reviewing the findings of a high-profile investigation that concluded earlier this year that all three companies broke rules that contributed to the oil spill.

The investigation was conducted jointly by the U.S. Coast Guard and the U.S. Interior Department. The committee’s hearing on the investigation will be held Wednesday and the CEOs were asked to attend by the panel’s top Democrat, Rep. Ed Markey of Massachusetts.

In separate letters sent to the committee Monday, the companies said their top chiefs wouldn’t appear at the hearing. BP said it was refusing because it already provided a top employee, BP America Vice President Ray Dempsey, to testify at an earlier hearing. It also said it couldn’t talk about the investigation because of ongoing litigation related to the spill.

“Given that BP already has provided a witness” and because of “the constraints imposed by numerous pending legal proceedings, BP respectfully must decline the invitation,” the company said in its letter to the committee.

Halliburton said its CEO, Lesar, has “significant world-wide responsibilities in leading the company” and will be out of the country. Transocean, meanwhile, said simply that its chief “will be unable to join you.”

All three companies provided top executives to testify at an earlier hearing on the spill investigation on Oct. 13, but their CEOs didn’t appear. Committee chairman Hastings “was satisfied with the way that hearing went,” committee spokesman Spencer Pederson said.

The company representatives weren’t available for immediate comment.

Markey is now vowing to take steps to compel the chief executives to testify before the panel.

“It is unacceptable for the heads of these companies to evade testifying before Congress in order to avoid answering questions about the U.S. government’s major report on the oil spill for which their companies share responsibility,” Markey said in a statement.

Markey said the CEO of Cameron International Corp. had also been asked to attend the hearing and declined to appear.

-By Tennille Tracy, Dow Jones Newswires

The Coast Guard said in a statement that a series of oil sheens—basically a thin carpet of petroleum floating on the surface of the water—spotted in the Gulf in recent months indicate the possibility of a release from the riser pipe or other debris from Transocean’s rig, now on the ocean floor after the April 2010 explosion that killed 11 people.

“The responsible party may be financially accountable for debris removal costs and damages resulting from the pollution incident,” the Coast Guard said.

A Transocean spokesman confirmed the company has been contacted by the Coast Guard concerning the oil sheen and said it’s “committed” to investigate the report. But Transocean, which the owned rig that BP PLC was using to drill the Macondo well, said BP may be the one ultimately responsible.

“If a volume of oil has remained in the riser, there is no question that it is oil from BP’s Macondo well,” said Transocean’s spokesman Brian Kennedy. “As owner and operator, BP is the responsible party for all fluids that emanated from the Macondo well head, and BP has repeatedly acknowledged that responsibility.”

BP didn’t respond to requests for comments. The Coast Guard said video footage of BP’s Macondo oil well shows that it isn’t the source of the sheens.

A Coast Guard spokeswoman said the agency will work with Transocean to determine whether or not the wreckage is the cause. “Once a cause has been determined, we will move forward with the most appropriate course of action,” she said.

The announcement is another kink in the fallout of the three-month oil spill that began April 20, 2010, which resulted from the blowout of the Macondo well. The accident killed 11 people and released millions of gallons of oil into the Gulf.

By BEN LEFEBVRE, Copyright 2011 Dow Jones