Transocean logo

Transocean’s Deepwater Horizon Insurers Seek Court Opinion On Paying BP

Total Views: 12
June 18, 2011

Transocean logo

HOUSTON (Dow Jones)–Transocean Ltd. (RIG) said Friday that insurers of its sunken Deepwater Horizon drilling rig have asked a federal judge to decide if BP PLC (BP, BP.LN) and other owners of the doomed Macondo Well are entitled to any coverage for the accident.

Transocean said it and its insurers believe that BP and minority well owners Anadarko Petroleum Co. (APC) and Mitsui & Co. Ltd. (MITSY, 8031.TO) are not entitled to any of its insurance proceeds. But the company, owner of the world’s largest offshore drilling fleet, said that court filings made Friday risk proceeds Transocean has previously listed on financial statements as assets.

“Ultimately, these actions may limit the amount of insurance coverage otherwise available to us and may have a material adverse effect on our statement of financial position, results of operations or cash flows,” Transocean said in a securities filing.

Transocean owned the Deepwater Horizon, which was drilling BP’s Macondo Well in April 2010 in the Gulf of Mexico when the rig exploded and sank, killing 11 and touching off the worst marine oil spill in U.S. history.

Soon after the disaster BP and the other well owners told Transocean’s insurers that they would seek coverage under the policies, which provide liability coverage up to $950 million, Transocean said.

The insurers who requested a judicial opinion Friday wrote liability coverage for the Deepwater Horizon totalling $150 million, Transocean said.

In recent financial statement Transocean reported assets of $180 million related to insurance policies for Macondo-related costs and losses.

Transocean said Friday that it is evaluating the impact that Friday’s court filings could have on that amount, though “there can be no assurance that we will receive any such proceeds from the court or that insurers subscribing to additional layers of our $950 million excess liability policies will not file similar interpleader actions.”

-By Ryan Dezember, Dow Jones Newswires


Back to Main