Archive for October, 2010

Halliburton cement job played role in BP Macondo blowout: panel

Thursday, October 28th, 2010 | Finance News

HOUSTON (Reuters) – BP Plc and Halliburton Co, the contractor who cemented the blown-out Macondo well, ignored cement design flaws weeks before the disaster that sparked the worst U.S. offshore oil spill, a White House panel said on Thursday.

Both Halliburton and BP were aware of flaws in the cement slurry, similar to the one used to seal the well, as early as March 8, "but neither acted upon that data," according to the National Oil Spill Commission's chief counsel, Fred Bartlit.

Halliburton had run a series of tests that showed the material was unstable, the letter said.

Shares of Halliburton fell sharply after the report's release. The stock tumbled as much as 16 percent before recovering some losses. Halliburton shares were off 11 percent, or $3.33 at $31.09 in afternoon trade on the New York Stock Exchange.

The cost to insure Halliburton's debt also jumped on the news.

The industry has developed tests to identify faulty cement jobs in offshore wells, but "BP and/or Transocean personnel misinterpreted or chose not to conduct such tests at the Macondo well," Bartlit wrote.

Tests conducted by industry cement experts show that "the foam cement used at Macondo was unstable," Bartlit wrote in a letter to co-chairs Bob Graham and Bill Reilly. "Halliburton (and perhaps BP) should have considered redesigning the foam slurry before pumping it at the Macondo well."

In an e-mailed statement, Halliburton said it is reviewing the report and will publish a response later on Thursday. A BP spokesman had no immediate reaction.

The report supports long-standing claims by BP that it shares the responsibility for the April 20 incident with its Macondo partners, including Swiss-based Transocean Ltd, which owned the doomed Deepwater Horizon rig.

BP's Macondo well ruptured on April 20, killing 11 rig workers and causing more than 4 million barrels of oil to spew into the sea.

The spill marred the coasts of four U.S. Gulf states, prompted a ban on new deepwater drilling and left BP's image in tatters in the United States, home to 40 percent of the London-based oil giant's business.

(Additional reporting by Anna Driver in Houston and Braden Reddall in San Francisco)

(Reporting by Chris Baltimore; Editing by Stacey Joyce)


Business events scheduled for Friday

Thursday, October 28th, 2010 | Finance News

Major business events and economic events scheduled for Friday:

WASHINGTON — Commerce Department releases third-quarter gross domestic product, 8:30 a.m.

Arch Coal Inc. releases quarterly financial results.

Cigna Corp. releases quarterly financial results.

Estee Lauder Cos. releases quarterly financial results.

Merck & Co. releases quarterly financial results.

Nasdaq OMX Group Inc. releases quarterly financial results.

BERLIN — German retail group Metro AG releases third-quarter results.

PARIS - French oil company Total SA reports quarterly earns.

TOKYO — Japan reports September prices, unemployment and household spending data.

Sony Corp. releases quarterly financial results.

Mazda Motor Corp. releases quarterly financial results.

Honda Motor Co. releases quarterly financial results.

Panasonic Corp. releases quarterly financial results.

All Nippon Airways Co. releases quarterly financial results.

Nomura Holdings Inc. releases quarterly financial results.

MUMBAI, India — ICICI bank reports quarterly earnings.


GM to repay $2.1B of government’s investment

Thursday, October 28th, 2010 | Finance News

WASHINGTON – The government says General Motors will pay back $2.1 billion of the funds that taxpayers invested in the company. That brings the total it has repaid to $9.5 billion out of the nearly $50 billion the government loaned to and invested in the company.

The Treasury Department says the company is repurchasing about 84 million preferred shares that the government owns. The purchase is on the condition that the company proceeds with an initial public offering of its shares. That IPO is expected to take place next month.

The government's remaining $40 billion investment in the company is equivalent to 60.8 percent of the company's common shares.