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II. Well Design

Well design is a fundamental and important phase of offshore drilling
operations. Operators must consider site‐specific factors, including flows,
pressurized formation flows, reservoir natural gas and oil type, reservoir
lithology (formation characteristics), reservoir structure, and the anticipated
volume of hydrocarbons to determine the best way to drill to the target reservoir
and to configure casing to allow production from the well. During the design
process, engineers use all available data to determine planned total depth
(sometimes referred to as “TD”) of the well, casing point selections, required
casing specifications, casing pressure ratings, cement slurry design, mud weight,
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and risk factors particular to the well.

Development wells are typically designed and drilled based in part on
data from nearby wells, referred to as offset well data. In the case of exploratory
wells, such as Macondo, operators have limited offset well data available,
making it more difficult to anticipate well conditions prior to the spud of the
well. As a result, design processes in exploratory wells are subject to change.
Operators typically deal with well design changes during drilling operations
through documented “management of change” processes, which are intended to
aid personnel in systematically identifying and mitigating the risks associated
with the changes.

The BP well engineering team and the BP subsurface team were involved
in developing the Macondo well design. The teams referred to various
documents and manuals while designing the Macondo well, including BP’s
internal casing design manual, drilling well operations policy (“DWOP”),
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advanced guidelines for deepwater drilling and other guidance.

A. Cost of the Macondo Well

BP exceeded its original cost estimates for drilling the Macondo well. To

obtain additional funds and continued participation from its partners in the
Macondo project, BP submitted to Anadarko E&P Company LP and Anadarko
Petroleum Corporation (collectively “Anadarko”) and MOEX several

49 Casing point is the depth at which drilling a particular wellbore diameter will end so that
casing of a given size can be run and cemented.
50 BP‐HZN‐MBI000010362.

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