HOUSTON -- Oil and gas supermajor BP PLC says it has returned to strong profitability as it gears up for a legal battle that could ensue starting this month.

The company this morning said its fourth-quarter net earnings for 2011 rose to almost $7.6 billion, up from $4.6 billion during the same period in 2010. Total earnings for 2011 were reported as $23.9 billion, a sharp swing from the net loss of $4.9 billion the company took in 2010 as a result of the Gulf of Mexico oil spill.

While much of the U.S. energy focus in 2011 was on natural gas supply surges due to hydraulic fracturing, the nation's largest independent oil producer, Anadarko Petroleum, remained bullish on liquids, producing a record 248 million barrels of oil equivalent of crude oil, natural gas and natural gas liquids from its U.S. and overseas holdings.

Fourth-quarter earnings by the Woodlands, Texas-based company beat analysts' projections by 37 percent, driving the company's stock price up 3.4 percent to $85.69, its highest intraday gain since 1986, when Anadarko's stock began trading on the New York Stock Exchange.

Environmental groups today filed suit against Taylor Energy Co. over Gulf of Mexico oil wells that have been leaking since 2004.

The Waterkeeper Alliance joined Gulf Coast organizations in suing Taylor in the U.S. District Court for the Eastern District of Louisiana, citing the citizen suit provisions of the Clean Water Act and the Resource Conservation and Recovery Act.

A federal judge today ruled that Halliburton Co.'s exposure to financial penalties relating to the Deepwater Horizon disaster are somewhat limited by its contract with BP PLC.

U.S. District Judge Carl Barbier of the Eastern District of Louisiana held that the contract indemnifies Halliburton over compensatory damages related to the April 20, 2010, explosion and resulting spill at the Macondo well, including the cleanup costs -- even if it is determined that the company was grossly negligent. That means BP would have to pay.