Halliburton 2011 Annual Report Download - page 115

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In addition to the federal laws and regulations, states and other countries where we do business
often have numerous environmental, legal, and regulatory requirements by which we must abide. We
evaluate and address the environmental impact of our operations by assessing and remediating
contaminated properties in order to avoid future liabilities and comply with environmental, legal, and
regulatory requirements. Our Health, Safety and Environment group has several programs in place to
maintain environmental leadership and to help prevent the occurrence of environmental contamination. On
occasion, in addition to the matters relating to the Macondo well incident described above and the Duncan,
Oklahoma matter described below, we are involved in other environmental litigation and claims, including
the remediation of properties we own or have operated, as well as efforts to meet or correct compliance-
related matters. We do not expect costs related to those remediation requirements to have a material
adverse effect on our consolidated financial position or our results of operations. Our accrued liabilities for
environmental matters were $81 million as of December 31, 2011 and $47 million as of December 31,
2010. Our total liability related to environmental matters covers numerous properties.
Between 1965 and 1991, a former Halliburton unit known as the Halliburton Industrial Services
Division (HISD) performed work for the U.S. Department of Defense cleaning solid fuel from missile
casings at a semi-rural facility on the north side of Duncan, Oklahoma. We closed our site in coordination
with the Oklahoma Department of Environmental Quality (DEQ) in the mid-1990s, but continued to
monitor the groundwater at DEQ’ s request. A principal component of the missile fuel was ammonium
perchlorate, a salt that is highly soluble in water, which has been discovered in the soil and groundwater on
our site and in certain residential water wells near our property.
Commencing in October 2011, a number of lawsuits were filed against us, including a putative
class action case in federal court in the Western District of Oklahoma and other lawsuits filed in Oklahoma
state courts. The lawsuits generally allege, among other things, that operations at our Duncan facility
caused releases of pollutants, including ammonium perchlorate and, in the case of the federal lawsuit,
nuclear or radioactive waste, into the groundwater, and that we knew about those releases and did not take
corrective actions to address them. It is also alleged that the plaintiffs have suffered from certain health
conditions, including hypothyroidism, a condition that has been associated with exposure to perchlorate at
sufficiently high doses over time. These cases seek, among other things, damages, including punitive
damages, and the establishment of a fund for future medical monitoring. The cases allege, among other
things, strict liability, trespass, private nuisance, public nuisance, and negligence and, in the case of the
federal lawsuit, violations of the U.S. Resource Conservation and Recovery Act, resulting in personal
injuries, property damage, and diminution of property value.
The lawsuits generally allege that the cleaning of the missile casings at the Duncan facility
contaminated the surrounding soils and groundwater, including certain water wells used in a number of
residential homes, through the migration of, among other things, ammonium perchlorate. The federal
lawsuit also alleges that our processing of radioactive waste from a nuclear power plant over 25 years ago
resulted in the release of “nuclear/radioactive” waste into the environment.
We and the DEQ have recently conducted soil and groundwater sampling relating to the
allegations discussed above that has confirmed that the alleged nuclear or radioactive material is confined
to the soil in a discrete area of the onsite operations and is not present in the groundwater onsite or in any
areas offsite. The radiological impacts from this discrete area are not believed to present any health risk for
offsite exposure. With respect to ammonium perchlorate, we have made arrangements to supply affected
residents with bottled drinking water and, if needed, with a temporary water supply system, at no cost to the
residents. We have worked with the City of Duncan and the DEQ to expedite expansion of the city water
supply to the relevant areas.