Alleeations The vyellwas significanty behind scheduleald over budget Wasn'l BP rushing operataons save tinre ard money?

to r r One of BP'stop priorities safeard reliable is operations. wellvrasbehindschedule The and overbu@et. But dl necessary fundingard scheduleadjustments been had approvedby BP and lhe dher companiespanicipatingin this well pfojec{. BP hasrre[ proieds that cleliver aheadol on time,and behindschedute. Someprojects come in underbudgetanrl someprojects comein n er budget. Sde and reliable operationsremain a priorityregardlessof how much a we[ is behird sciedule or over budgei. The well was a problem well, malry gas kicks along the way o r lt is not uncommon experience "kic*s'whilednling deeprarater to exdorationwells. The Transocean lhat workedon the MC252 rigs welt experienced earlierinfluxes tno inlo the well.The Transocean crars safelymanaged these influxes usingwell contml procedures per their company policy(Deepwaler as HorizonEmetgency Response Manualard the Well Cont]Dl Hardbook).Fuilher,lhese kicksweretlpn isolated with casing. ln addilion, multlpletog cindatbn eventsoccuneddudry the dd[hg of the v,/ell.Thls is nol uncommon deepvalerwellsand was managed in effeciively bythe rig crews. Why diOgp choose an unusul design to use a .,tong stting" of casing over the full length of thc well rafier t|tan running a production llner and then tying it back to the ntellhead? . Thereis no industrystanding regarding whichtype of casingshouldbe usedin deepvraler exploration wens.Th6 use of longstringcasingis not unusual. To the contrary,the uee of long strings,productionlinefs, productionliners/tie-backs are acceptable de;igns-and thesevadoustypesof deslgnsare usedin wellsthroughout the Gulf of Mexioo.Wtrich designto use dependsupon a variety of factors,inctuding comfletionrequiremenls life-cycle and integrily ooncems. engineers BP evaluate various fadors for each we[ to detemine tfie most appropristecasing slriategy. It wre a poor cement job and BP chose not to rcdo cement jnb to lrave money lf therenrereindications an unsuccessful of cementing operalion, planned use a Bp to oemenlbondevaluation andthenevaluate edent of any neoessrary tool the remedial work. Thiscontingency because lherervereindicaiions a of flan was not implemented successfulcementingoperdion. Multaple inwsligetionsare exemining timelineandwin interpret the e\rents basedon available dataand wilnessr.eporls. Theseinvestigations conlirnring. are Bp's investigalion leam has not yet hadaccessto all $rilnesses available and information sourcesthatcould help unders*and what happened. The cerent fob was rushed - 20 lnstead of 2,0hours ]hg neoativelest was $arted more than 16 hous after the cementingoperetionon the g 7/8'x ?'casig was completed. cement tesls beforethe operationslrowedthat tne cemer{ in the bottom of the 9'7E x 7'casing at that time would have significanl compressive stjength. The strength wouldhaveincrased only andter lo% over an additlonal eigm hours. lt was not necessaryto wait longerforthe cementto develop more strengthbforetesting for leaks.

Exhibit No. Worldwide Court

TREX-06384

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Multipleinveslpations examining timelineandwill interpret are the evenlsbasedon availaHedata and wilnessreports.TheseinvedftTations continuing.BP's are investigalionteam has not yet lnd accesslo all witnessesand availableinformation sourcesthet oouldhelp urderstand what happened. A second cernentplug should have been.placedprior to displacing mud with seawabf The order of negdive lest, displacementof mud with seawater,and final surfacecement plug placernentwas submiftdand approvedby the MMS on Apfil 16. The BP pmcedure was con9slent with the MMSapprovedpemit-atd consistentwith good operating pradioeThe orderof thce operalions wes not a last minute decision. This sequence operalions, of indudirq settingthe fmalpltrgin seewater, not is uncornrnon BP in the GoM. for l/Uhydidnt BP follor good industry practice to circulate botoms up before cementing? Circulation time asone of manyparametenconsidered when designing successful a cementjob. The successof any cementjob is a func{ion design,plecement ot techniques, well cofidifons.and e:<ecution. Multipe ongoirpinvesli;albnswill examine limelineand will interpret lhe eventsbased on avdlade dala and witnessreports. BP's invesiligation team has not yet hd accessto all witnesses and available irfornation sources that couldhelp understand what happened. l trty did BP choose to only partially cover casings deep in the well? Several industry erperts haw commentedthatthe design was "shocking" and would be difncuL to test tfre cement Fb for leals. ln deeFvatorsubseawells,tho spacesbetween casingsare subiect a phenomenon to knownas AnnularPressure Buildup(APB).APBis causedby thermalexpansion of trappedfluidsin an annulusas lhey are heated duringprodudion. The fluitJs only are trappedif the annulusis sealed. preventa sealedannulus,it is commoninduslry To pracliceto leavecemenlbelov the previouscasing, long as the designisolates as hydrocarbon bearingzones. The MG252well failed prssura test several hours before explosion Pressureand florv anomalieshave been observedin the recordeddata durirg the negative te$ operation, wtrichbeganseveralhoursbeforethe ex$osion- Multiple ongoingInvestigations examlne limelineandudnhterpreteventsbasedon will the availabledata and wilness rcports. BP's investbationteam has noi yet had accessto all witnesses and available information sourcesthat couldhelp unders{and what happened. BP told Transocean and Haniburton staff not to do temperatur tcst on cement robt cauging incident The podnctioncasingplancalledfor cernentbondevaluation onlyif therewere indicdions that the cemerilingof the productioncasingwas unsuccessful. A cementbondevaluation (Scfrlumberger tool)was on location be run in the tool IBC to e\rentof a pouematic cernnt operation. lt was not run basedon the indicationsof a success{ulcementlng operatbn.

a a

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Therewere no plansto run a lemperalure because cementevaluation log if was needed, the more effeciive IBC log would have been run. BOP modifrcations by BP in At04 Gausedtte aceident In 2004,BP requesled and paidfor a modificalion forTransocean orxwertone of BOP lo dack's three variable bore rams into a test ram. The requestedmodfication was approvedby Transocean was performsd erd underits direction andcorfml. The modilication rellecledin an amendment the DrilFrContract. b to Use of a lest ram on this BOPcomplled with MMSregulations, ls commonamong and otheroperdors in the deeprrvaters the GoM. Thistesl ram mdilbation dld not impad of the emergency disconnect deadman or sySems. Following conversion, BOPstacl the had four remainingadive rams (and two srnular preventers). This povtued the redundancy requiredby the MMS. ln lhe daysfollo,ving lnddent,BP woned ha|d underdifficult lhe drcumslances lo ac{ivatethe BOP to stop continuingdischargeof hydrocarbons frornthe vrrell.Duringthe post-incident ROVemergency intervention, whilepumpingin the ROVsilabfor the 6ipe provided rams,BP believed(based the'as-built"BOPdesigndrawings on by Transocean) the ROVinlenntionlinewasconnected actuete variablebore that to the rams in the mbdle ram cavity. BP laterdiscoveredthrough post-irncttent investigation that the ROVintervention was in fad was connededto thetes{ rarnal the bottomof line lhe BOP$ack. Tesi ramsare not designed holdpressure to frqn below. partof the rig. All vuorh modifications Transocean ownsthe BOPand it is an integral or of the BOPequipment require apprwal of, ard are performed the underthedirection of, Transocean.BOPmaintenance operalion, well as th relatddocumentation, as and ere the accountablity Transocean.The contradbetvveen of Transocean BP required ard that Transocean operale,le$, ard maintain BOP in accordance the with all applicable performed iG regulations.Transocean accountable elrsure is to any modilications on BOP are in accordance Transocean's the originalequipment with and manufacturefs' policiesand pocedures and to Transoceanl satlsfacton. recommended BOP Shear rams werc not capable of shearing ddll pipe used in deepwaterwells BOPSare safelycriticaldevicesand the ultimate failsafedeviceto securea well in the eventof vyell flow. They are &si;ned lo havemuftiple levelsof rcdundancy, whichhas giventhe industryconlidence lheir operations decades. in for According Transocean's to Well ControlHandbook, blindshearrarnmust be capable lhe of sheering highestgradeand heavie$drillpipeon the rig (hearry the rvebhtddll pipeHWDP- exduded)andseelingof the well in one operation. Transocean's orlglnalequlprnent guldance manufacturer, Cameron, provided has indicating the $1/2" tubethal was across stackat the time of the incident that lhe could be shearedby the Uind shearram installed lhe Deeprvater in Horizm's BOPstack. Waterdedh is taken intoaccountinthe Cameron advisory. The blindsharram oannotcut the tooljointsof +1/2" drill pipe. Transocean personnel are responsabb knowinglhe locationof tool joints in the BOp dudng operationsand for for ensurlng lhat tooljointsare not locatedInthe path of bllndshearram.

\--l

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The BOP should have bad a remote control / acoustic switch An acousticbackupernergency conlrol systemwas not installedon the Horizon BOp. But it did havemultipleemeenGy sysilems indudang Deadman a rystem (which activdesufpn all hydraulic and declrical porer Lslost),an Auto6hear system,and ROV intervenlion, well as an Emergency m DisconnedSystemCEDS). An additioml acouslic system addscunplexity lo lhe hardrare on tte BOP stack if - as wasthe casehere- a rig is equipped wilh an EDS,a Deadman sy$em, and has ROV intervenlioncepability BP discovereda leak during ils response efiort; this should have been noticed on the rig if lhey had been present before the bbwout Over the past fetr weeks during pcsl-incidentROV interuenlionoperalions,BP detected multipleleaksin the BOP subsea hydraulic systemduringpostincident ROV intervention operations. These leaks causedsignificsntdelay in BP's effort to actuatethe BOP during the response. Multipleinvesligations examinirqthe timelineandwill irterpretanentsbasedon are available data and wilnessreporls. Theseinvedigalions continuing.Bp's ere invesl(lationteam has not yet had aooessto all witnessesand availableinformation sourcasliel couldhelp understard wttat prevnted BOPfromoperating intendedlhe as BP discovercd a dead battery durhg recovery efforts; this shouH have been noticed on the rig if thy had been present belon the blowout Multipleongoirpinvestigations examining timelineandwill iilerpret eventsbased are the on evaileuedata and wilnessreports. BP'sfuwestigation tearnhasnol yet had a@ss to all witnesses and available information sources thal couldhelp understand what happened. Did BP put prcssur on Transoceanto skip sbps? o r One of BP'stop prioritles safeand rellableoperatlons, is quote fromMay 19 Congressional Sleve Nevwnan hearings'wewitlnevercornpromise safety in prrsuit of cuslomersalisfaclion'. Allegations of non-OEMparts i'| February2010BOp wod(? TransoceanonnslheBOPanditisanintegral partoftherig.Allmaintenanceworkand ' modificdions of the BOP equipnent requirethe app'orralof, and are performedat the direcliond. Transocean. . BOP mairlenanceand operation, rvellas the relateddocumentdion, the as are accountabTtyof Transocean. By contractthe BOp was to be used,tested, and maintained Transocean accordanc all appficable by in wilh regulations. Transocoan is accounlabb lo ensure any repairsand modifrcdionsperfomed on its Bop are in accordancewith Transocean'sand the original equip,ment manufadureis policiesand procedurcsand to its satisfadion. o

A recent report stated that two BP reflneries accorrrt for 97% of a[ flagrant osHA violations. Ilo you have systemic ssfrty probbm? r o BP hasworted diligently since lhe accider* in Marcfr2fl)5 to addresssafety concemsat the TexasGily site. BP has spent more than $1 billion al Texas Cityto addresssafety concemssince 2005. We erntinue to work cooperativdywith OSHAto resolrrcthese rnaters.

AL

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t.

Atlantis alleqations o r . . ' We havetakenlhis allegation veryseriously. adfiftn to an investigation In conducted by the Omhrdsman'soffice, we conduded our orynintemal investigation. The inve$[ation found lhat the operatorson the dafform had full asoesslo the drawings (topsides,hull, and subsea)neoesstry operatelhe flatfom safely. to Therewas an issuearoundwhether eledronicfilirp of thosedrawings the was consident with the proiecl executiondan, bul the key fad as lhat the operatorson the platformhad access to the drawingstl|ey neededfor safe operalion. The Omhtdsrnan'soffice did not performa technicd ora regulatoryre\rbw of the Atlantis offshore productionplatform. MMS comnrenced invest[alionon April 20 thatconlinues an today,a data roornis cunentlyopenand BP is fullycooperating lheirinvesligation wilh

Plan r r o The GoM Oil Spill ResponsePlan meets the reqdrefllents set forth by MMS regulation. The OSRPs[sforththe procedures response and adions that BP wil take in lhe event of a spill. BP b following tMt planunderthe direclion the Unified of Conrnand. The OSF identifies3 wor$ case scenariosand our capabilityto respondto lhose scenarios;the ExplorationWell Worsl Case DischaBe sc*nario has a planned response periodof 30 days. The lalesil updaleslo the GoMOSRPwere apprwed by MMS on 21 July 20tXl. The OSRP is reviewedwith local govemmentsto ldernify

. .

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BP-HZN-21 79MD1030851 52

Transparency BP is committed provilingthe American lo peode withthe informaiion they needto understard lhe environmental impad fromthe sri! andthe rcsponse $eps thal have beenteken.steps we'vetaken include: o o o o . o o . Relevantdata regarding environnrenlal sampling monitorirgis beirg coflected and and then sharedwith the EPA.Muchof this data is available the EPAs cn,yn on website: A livewebcamof the riserflotvis availaile at www.bo.com; We haveansrered questions 5 Congressional at HearirEsand provided multiple briefings with lhe DOl, DOE,EPA,DHS and members Congress; of We have respondedto over 90 requestsfor information from Govenrnent Agenciesand Congress; In lhe Gulf staiesBP has eslablished community 21 supportleamsto dlrecilyanswer questions and assistthe localcommunilies impacied the spill; by Tony Hayrvard ansrvered questions ABC, NBC,CBS, CNN,Fox navs. BBGas has on uell as to pdntmedlaand localmedaal Bob Dudleyhasanswered ques{ions CNN and NBC; on

Doug suttles has answered quesilions on'Today','Good MomingAmerica',The Early ShoW", CNNas well as to localmediaan<l and radio. Providing information on the flor BP has been provading livs teed from lhe seabedto govemrnentoflicialsthroughthe Unmed a CommanC Loulstana, well as to BP and industryscientists engineeFitrvoUeO tne in as and fr spill response. To supportthe work of the Flow Rate TecfinicalGroupcreatedby the NationalIndent Commard,BP has provided requested a[ information, including diagrams and scfpmaticsas well as amountsof oil and gas beingcolecietlthroughthe RITT.To tuther assig the FlowRate Technical Group,BP has nameda dedacated technical expertto ansrver queglonsand any informdionrequesls.

BP-HZN-2 79MD103085 53 1 1

Dispersants 'tess toxic"werereviewed HEADLINE MESSAGE:The dispersants EPA considered and contain a detergent that maydegradeinto an endocrine (nonylphenol NP),whidt cannotbe disruptor or injecleddirecty intodeepwater nearthe vyell head,withoutvblating EpA'swaterquality standards.Corexitdoesnol conlainthe samechemhab. Urderlhe diredivesissuedby EPA and the CoastGuard,we (BP)will continue use Corexit to wlrilewe workwiththe agencies to evaluateother disporsants. . BP evaluated dispersants met one seleded EpA toxicirycriteda(the LC-50 that tesi). Olhercdteriaare relevanl. The dispersarilslhat some have charac{erized less toxic by one citeria can be as harmtul in olher ways. Three dispersantsmeet EpA's toxicity criteria,and can be purchased lhe anrountneededat this site. Br[ they containchemicdsthat may in degradelo NP, an erdocrinedisruptor.NP has beenlinkedto potenlidhumanhealth risks by some adhorities and the water quality criteriabr NP couldrvell be violated if thesewere injected directlyintodeepwaler nearthewell headat the ratesnecessary to petform efec$vely. We may meed water quality crileda if the dispersantsare sprayedlightly on the water the surface,ufiere lhey quicklybecmreditded. Thal is the onty useEpA prwbusly approvedin its productapprovalproc*s (the NGp productlist). we have a supply of a dispersantcalled sea Brat thd meets EpA's toxicitycrileria, but may degna@ NP. wb are prepared usethis on the watersurface, EpA and coasl to to if Guardtell us to do that. We believe they are takirp a carefullookat this optionin lightof the concems witn NP. c-grexit doesnd degradeto NP,andwe will continue use core)d unfl the agencies to direcl us to do something else. we are onlyr altowed use the dispersants to whenthe CoastGuardadhorizes il, and onlyin the way hat ttrc CoastGuardspecifies. We are wortirq dosely with EPAard the CoaslGuardto monnortheefiectof dispersants lhe environment. on Dlspersants haveneverbeen usedunderwater ihls In way and we havebeenworkingwiththe agencies gdher as mucfidate as possible to to understand cunenl situation the and for the future. o So far, rvele leamedlhat we can use lessdispersant undefwater, than we use on the srface, to achieve same result. \flteall wantto useas li$e the dispersant possible, as and this may be oneway to do thal. (We needto use 3 to 4 titns more dispersanton lhe surfaceto achbve lhe same effeciivenessof treatment). \r!b\re also leamed that its possibleto use the dspe]sarf ufllerwater in bad wedher and at night, in conditionswherc other optionsdonl rvork \Mren the wavesare loo high for boomsto containa sfill, for example. Thb asextfemely helpfd !n the overall responseand lhat may be a useful lessonfor peoplewhd hsvelo respondto othef oil sfills in the futuF.

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The conlidentidinformatlon is missing thal frcm EpAbwebsiteinvoMesthe poprielary formulasfortheseproducts. lt is information thal, if puuished,anyone coulduseto replicatethe product"without permission. The manufucturers irot gve us or EpA did pemissaon puuish that on the web - I'm sureyou can urdersilard*rfry- lt is the to essenceof tneirtrade secretfor business purposes.wb betieve that EpA has all the proprietaryinfonndion to conducttheir rcvia/vsof potentialdskswilh usingthese producfs. is.1og!-{i1( deep underwater. The deeprter samplingard monitoring program, Itrereoperated by uAc - wilh science inputtrorn uscc, NoA,\ EpA ano Bp - shows higily

BP-HZN-21 7eMD1030851 54

dispersed hydrocaroons. Norwegian researchers alsorunning are modeling rrvork commissioned NoAA. l/wratwesee,in facl,is thatoil in thewater by column becomes highly diluted, because volumes depths the and invohrcd sogreslinlhis partoflhe are oean.Theconcentrationoilinthewalercolumn beonly$brruy of wiil higher it that would havebeen enycaseasa result nature's abinyto break oil slicks in of ovn the dorvn droplets. into Since dfference so small, do notbelieve the useof the is ure that dispersants thewater in column theGulfhasmade in mdterworse fishandother for marine organisms also dispefsants notmaks b!, do maners worse" SatedMarkReed of SINTEF.

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