Transocean in squabble over oil spill subpoena

  • World
  • Tuesday, 22 Jun 2010

WASHINGTON (Reuters) - A U.S. board examining the Gulf of Mexico oil spill has subpoenaed Transocean Ltd for equipment recovered from the sunken vessel and other records, setting up a potential clash with investigators conducting a separate criminal probe.

In early May, a special U.S. Marine Board of Investigation and the Justice Department separately ordered Transocean to preserve and retain material that could be needed for their probes of the well drilling and subsequent explosion that set off the oil leak.

However, the Marine Board issued a new subpoena to Transocean on June 16 seeking the 50-foot (15-metre) section of the riser that was cut from the top of the blowout preventer that failed to cut off the oil flow, according to a copy of the subpoena.

The board also ordered Transocean to hand over work logs for all employees on the Deepwater Horizon drilling rig and any other debris recovered from the vessel that sank, according to the subpoena filed with a federal court in Texas.

That sets up a potential conflict with a separate criminal and civil investigation by the Justice Department.

"The June 16, 2010, subpoena impedes and precludes petitioner from complying with their legal obligations and other subpoena and court orders," Transocean said in its request to the court.

Transocean on Friday asked a federal judge overseeing its liability case to block the subpoena because it said the demand conflicts with the orders by the Obama administration to retain the materials for the criminal investigation.

The company said it "cannot simultaneously comply with the U.S. Department of Justice subpoena and the June 16, 2010, subpoena of the board."

A Justice Department official said that the Marine Board request should be honoured and that it was not at odds with its directive to Transocean that it preserve records and evidence.

"The subpoena from the Marine Board of Investigation does not conflict with the Justice Department's request," the official said. "We expect parties to comply fully with subpoenas and other requests from the federal government."

Transocean said the subpoena from the Marine Board was a "surprise" and it had received no prior notice that the panel wanted the material handed over. It said the recovered evidence has been stored at its yard near Morgan City, Louisiana.

The Marine Board inquiry is a special joint probe by the Coast Guard and the Department of Interior's Minerals Management Service. It is focused on the events surrounding the explosion and will develop recommendations to avoid future incidents.

The judge in the case set a June 29 hearing on the issue.

Representatives for the Justice Department and the Department of Homeland Security, which includes the Coast Guard, had no immediate comment.

Transocean made the request in its case to limit liability from the rig explosion and sinking. The case is In Re: Triton Asset Leasing GmbH, Transocean Holdings LLC et al, in the U.S. District Court for the Southern District of Texas, No. 10-cv-1721.

(Reporting by Jeremy Pelofsky, editing by David Alexander and Stacey Joyce)

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