Arraignment set for Halliburton on Gulf spill criminal charge

Oil field services firm Halliburton is scheduled to be arraigned Wednesday on a federal charge of unauthorized destruction of evidence in connection with the 2010 Gulf oil spill.

The company has agreed to plead guilty, though it is unlikely Halliburton would enter its planned guilty plea at that time. Another hearing is likely to be held in the next few weeks, at which the guilty plea will be entered. Halliburton attorney Marc Mukasey could enter the plea on the company’s behalf, or a company official could enter the plea.

An electronic docket entry Friday in U.S. District Court in New Orleans said the arraignment hearing will be held before the magistrate assigned to handle arraignments that day.

The Justice Department said Thursday that Halliburton will plead guilty to the misdemeanor charge in exchange for a $200,000 fine and three years probation. Separately, Halliburton made a voluntary contribution of $55 million to the National Fish and Wildlife Foundation that was not conditioned on the court’s acceptance of its plea agreement, the Justice Department said.

In a court document Friday, the Justice Department said it has agreed to advise federal agencies that may bar Halliburton from new federal contracts following its guilty plea that the company provided significant cooperation to the criminal probe and agreed to accept its responsibility. BP was barred from lucrative federal contracts after its guilty plea to manslaughter and other criminal charges in the oil spill case.

The latest developments follow testimony at a civil trial earlier this year at which a former company lab manager admitted that he was asked to throw away his notes on some cement testing the company did after the spill.

Also, a federal judge in New Orleans is weighing whether Halliburton, Transocean and BP were grossly negligent in connection with the worst offshore oil spill in U.S. history.

A gross negligence finding would open the companies to potentially billions of dollars in punitive damages. Attorneys for victims suing the companies have suggested in court that Halliburton’s conduct after the incident should be factored into the gross negligence finding.

Because the questions the former company official was asked at the civil trial involved cement samples and the charge announced Thursday involves centralizer modeling related to the cement, it was not immediately clear whether that testimony forms the basis, at least in part, of the charge to which Halliburton is pleading guilty to. The Justice Department declined to comment on the issue.

Halliburton said the Justice Department has agreed that it will not pursue further criminal prosecution of the company or its subsidiaries for any conduct relating to or arising out of the well incident.

Authorities have not said whether individuals also could face criminal charges for destroying evidence, but they did say the probe remains open.

BP owned the undersea well that blew out off Louisiana, triggering an explosion on the Transocean-owned Deepwater Horizon rig that killed 11 workers. Millions of gallons of oil spilled into the sea for nearly three months before the well was capped. Halliburton supplied the cement that failed to prevent oil and gas from seeping out.