SUPREME COURT DENIES CERT IN TWO OIL AND GAS CASES

By TONI ELLINGTON

The U.S. Supreme Court has denied petitions for certiorari in two oil and gas related cases for this Supreme Court session.

First, the Court denied certiorari in the case of Century Exploration New Orleans, LLC v. United States, No. 14-459.  The petition in this case was filed by Century Exploration New Orleans LLC (“Century”) over the Department of Interior’s new oil spill response requirements which were added to a drilling lease.  The case was an appeal from a ruling of the U.S. Court of Appeals for the Federal Circuit.  In the petition, Century had appealed the new burdens imposed on its oil and gas lease. Century leased the rights to an oil field in the Gulf of Mexico for $23 million up front, and $50,000 per year.  Two years after the lease was executed, the Department of Interior sent Century a notice that it had recalculated the cost of cleaning up a hypothetical oil spill from $45 million to $1.8 billion.  This required Century to have $1.8 billion on hand for a possible disaster.  Because Century could not do so, it could not operate the lease.

Next, the Supreme Court denied a petition for certiorari filed by American Commercial Lines, LLC (“American Commercial”) in American Commercial Lines, LLC v. United States, No. 14-438.  American Commercial sought Supreme Court review on whether the Oil Pollution Act trumped general maritime law in the lawsuit, which arose after a shipping accident and related cleanup costs.  American Commercial is a river shipping company which was involved in a 2008 oil barge collision that spilled 300,000 gallons of oil into the Mississippi River.  American Commercial claimed there was a split in the circuits on whether and to what extent the Oil Pollution Act trumped general maritime law.

For more information on Supreme Court action, contact Toni Ellington at (405) 599-8500.