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Halliburton blames first quarter losses on oil spill litigation

Since the troubles with oil rigs in the Gulf of Mexico in 2010, companies like BP and Halliburton have been struggling to stay afloat amongst a recessed economy and civil lawsuits. But while BP appears to have settled a majority of its litigation woes, Halliburton is still in talks to settle claims filed against the Texas-based company.

It's because of these existing civil cases and fines from the government that Halliburton reported a loss of approximately $18 million in the first quarter this year. Despite showing a 4 percent increase in premarket trading, the company says that it's losing about two cents per share. Its biggest push in the upcoming months will be to come to a settlement agreement and put the matters of business litigation behind them.

So far, talks have included both cash and stock options, with the cash portion intended to be paid over an extended period of time. While Halliburton says that many of the settlement talks are in the advanced stages, no settlement has been reached at this time. This may have something to do with the continued dispute between Halliburton and BP.

While BP acknowledges that it could have done more to ensure the oil rig's safety prior to the 2010 blowout, the company denies being grossly negligent in the Gulf of Mexico oil spill. BP feels that Halliburton should have to shoulder some of the blame for the catastrophe as well. Halliburton disagrees, however, pointing out that as the well's owner, BP should be held responsible for the blowout and the subsequent damages to workers, their families, and the environment.

Source: The Insurance Journal, "Texas-Based Halliburton Posts 1Q Loss on Oil Spill Litigation Charges," April 23, 2013