Sunday, August 28, 2011

ExxonMobil Sues Gov't for Canceling Deepwater Well Worth ‘Billions of Barrels of Oil’


(CNSNews.com) – 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.
Alaska oil rig
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.http://www.cnsnews.com/news/article/exxonmobil-sues-obama-administration-can

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