First of all, check that the URL (hostname and port) is reachable from the server running the BPEL (try to ping it from the server ?).
Once you've evict the obvious problem from the list of the potential issues, try reading the server logs.
Sometimes this error is raised but in fact the real error is completely different. Most of the time you can have hints in the server log file.
For example I have already encounter this error when the service response was not well formed. (So the service was effectively reached but the response was not understand by the BPEL).
http://ltrthipireddy.keste.com:8989/Process1CallbackBinding/processResponse in Soapui ReplayTo(inside WS-A tab of Test Step Request) ,
in case of localhost it is treating of linux machine localhost inside vm box, so i have given my system name it was worked for me.