According to CNS News, ExxonMobil has sued the federal government for canceling an oil drilling lease in the Gulf of Mexico after the company spent three hundred million dollars on development. The company also claims that the wells are worth billions of dollars in production, and the government can now turn around and sell leases to other producers. I know, you’re shocked!
ExxonMobil, the world’s largest energy company, filed a lawsuit against the federal government for canceling an oil-drilling lease in the Gulf of Mexico that held “billions of barrels of oil,” according to the company.
In the suit, filed Aug. 12 in federal court in Louisiana against Interior Department Secretary Ken Salazar and related parties, Exxon alleges that the Interior Department made an “arbitrary, capricious” decision in canceling the deepwater leases, arguing that the government’s action “deprives ExxonMobil of property without due process of law.” ExxonMobil lawsuit filing..pdf
At issue is an ExxonMobil project in a part of the Gulf of Mexico known as the Julia Field, which the company estimates holds “billions of barrels of oil.” ExxonMobil was in the process of connecting the wells drilled in the Julia Field to existing oil platforms in a nearby part of the Gulf when the Bureau of Ocean Energy Management, Regulation, and Enforcement (BOEMRE) canceled the leases, accusing ExxonMobil in 2009 of not having a “commitment to production.”
ExxonMobil had asked for a Suspension of Production (SOP) allowance in 2008 in order to have enough time to tie the wells in the Julia Field to the nearby production facility, something it said the government normally allows.
However, ExxonMobil contends that in arguing it did not show a “commitment to production,” BOEMRE used criteria it had never applied before, and that did not exist anywhere in federal regulations. (read more)
I wonder how many jobs they killed with this move, and how much revenue the federal government has lost out on. Now our tax dollars will be spent defending against this lawsuit.
Update: Maggie’s Notebook linked – thanks! The Sundries Shack also linked – thanks!
Tags: administration, drilling, ExxonMobil, gulf, Julia Field, law, lease, obama, oil, suit
[...] Karen at The Lonely Conservative has the story I’ve been trying to do, but get distracted. Exx… for canceling their Gulf leases. You’ll remember that Obama, his Interior Secretary Ken Salazar and his Gulf moratorium are held in contempt of court. Maybe ExxonMobil stepping-up will start a trend. Oh, and they announced in June one of the largest oil and gas finds in the Gulf of Mexico in the last ten years. [...]
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[...] the “push back twice as hard” advice the President had his minions give to union thugs would work pretty well in court, too. Good for them. I hope they win big.Well what do you know? The more we study, the more we learn [...]
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[...] Karen at The Lonely Conservative has the story I’ve been trying to do, but get distracted. Exx… for canceling their Gulf leases. You’ll remember that Obama, his Interior Secretary Ken Salazar and his Gulf moratorium are held in contempt of court. Maybe ExxonMobil stepping-up will start a trend. Oh, and they announced in June one of the largest oil and gas finds in the Gulf of Mexico in the last ten years. [...]
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0 
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