Should Anadarko Share In BP Clean Up Costs?
RENEE MONTAGNE, Host:
And thank you for joining us.
BRETT CLANTON: Good morning. Glad to be here.
MONTAGNE: Now, let's begin with some basics, how does it usually work? Does the lead player - and it would be in this case be BP - pay all the costs when there's an accident?
CLANTON: No. Typically, in these deepwater projects, there are several partners to help spread out the cost of developing a deepwater well. So in this case, BP owns 65 percent, Anadarko has 25 percent and Japan's Mitsui has 10 percent. So, you know, they shared all the upfront costs to develop this well. Conceivably, they're supposed to receive production from this well along those same kind of lines. And then if there's a spill, they would split the bills according to their ownership stakes.
MONTAGNE: Now that, you say typically, that would sound like under the circumstances where nobody's at fault.
MONTAGNE: Exactly. And, you know, these contracts are written in such a way to give the minority partners - the non-operating partners - an out if the operator is at fault in the accident. So, in this case, you know, Anadarko is accusing BP of gross negligence or willful misconduct, and these are very careful words that they've chosen here. If Anadarko, it can prove that BP deliberately made errors, than, you know, they could be exempt from the cost of - their cut of the spill cost.
MONTAGNE: So will BP be able to show that it was not fully at fault, or will Anadarko be able to show that BP was?
CLANTON: Well, it's unclear at this point, I mean, is the short answer. Right now, Anadarko has just leveled these accusations at BP. It's not in a formal lawsuit yet, but you're starting to see where - how their plan of attack against BP and using this language - which is, you know, legal language - here against BP which is looks to be setting up a lawsuit.
MONTAGNE: So we can look forward to long years in court in this one.
(SOUNDBITE OF LAUGHTER)
CLANTON: Almost definitely.
MONTAGNE: Is BP's disaster in the Gulf affecting partnerships that it has on other projects?
CLANTON: The question is whether companies are going to be willing to sign up with BP in an operator capacity, where BP is calling the shots, you know, running, doing the day to day management of a well out there. They may still be happy to have BP along as a financial partner in projects, but Anadarko is the only one that has sort of publically questioned whether they would do business again with BP. You haven't heard it explicitly from other companies, but that's one of the big questions that has to be answered.
MONTAGNE: Thanks very much for joining us.
CLANTON: You're welcome. Glad to be here.
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