The company also plans to take more losses on the project in the first quarter.

The deepwater offshore and production complex project has been in dispute since cost revisions delayed a US$2.5 billion order for two oil rigs ordered from Brazil’s national oil company Petroleo Brasileiro SA (Petrobras).

In a statement Halliburton said, “[Our] KBR engineering and construction subsidiary has agreed to amend existing agreements with project owner Petroleo Brasileiro SA regarding the Barracuda-Caratinga project, and release both parties from all existing claims, including pending arbitration proceedings in New York.”

Petrobras had, last year, agreed to pay US$59 million in disputed claims and take an additional US$375 million in claims to arbitration in New York.

“[We] will [also] take additional operating losses on the project in the first quarter of about $62 million, or 14 cents a share. The additional charges stem from higher cost estimates, schedule extensions and other factors,” added the company.

The settlement, however, is still subject to lender approval and final agreement and Halliburton has gone on record as stating it will pursue final arbitration if all parties concerned cannot reach a final agreement.

KBR president and chief executive Randy Harl hopes a settlement can be reached. According to Harl, “The agreement in principle with Petrobras, if consummated, would significantly reduce remaining risks associated with this project, provide resolution to our claims and reduce the potential for significant late-delivery penalties.”