OIL SPILL | Transocean slammed over Admiralty defence

Deepwater Horizon on fire (photo USCG)

CONGRESS and the White House have rebuked Transocean’s move to use 160-year-old admiralty law in an effort to insulate itself from Deepwater Horizon damage claims.

In court documents filed on 13 May, Transocean sought to invoke the Limitation of Liability Act of 1851 to limit its damages to $27M, the estimated value of the Transocean interest in the offshore rig when it blew up on 20 April, killing 11 people and causing a huge spill.

At a Capitol Hill hearing yesterday on liability issues, Oregon Democratic Senator Ron Wyden chastised Transocean for trying to limit its liability and asked Associate Attorney General Thomas Perrelli to comment on the strategy.

“I can’t say it’s illegal, but it’s certainly unacceptable, given the tragedy that happened in Gulf [of Mexico],” Perrelli answered.

Wyden also questioned Transocean’s plan to distribute $1Bn to shareholders despite the disaster, wondering how that would affect the company’s ability to pay claims. But Transocean noted that it has insurance to cover the rig and other claims.

Also yesterday, at a US District Court hearing in Houston, where Transocean filed its petition, attorneys alleged that negligence by BP and Transocean would make the old law inapplicable, Bloomberg reported.

Source: SAFETY AT SEA INTERNATIONAL

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