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EnscoInjunction-021711

EnscoInjunction-021711

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Published by: tom_fowler7438 on Feb 17, 2011
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07/12/2013

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The January 13, 2011 Order (Dkt. No. 180) is VACATEDonly to the extent that it applies to the plaintiffs motion forpreliminary injunction as to Count IV (Dkt. No. 139).
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Permitting for shallow water drilling also hassuffered delays.1UNITED STATES DISTRICT COURTEASTERN DISTRICT OF LOUISIANAENSCO OFFSHORE CO., ET ALCIVIL ACTIONVERSUSNO. 10-1941KENNETH LEE "KEN" SALAZAR,SECTION "F"ET ALORDER & REASONSBefore the Court is plaintiffs pending motion for preliminaryinjunction, which, after oral argument, the Court denied withoutprejudice on January 13, 2011 and ordered supplemental briefing. The Court now RESCINDS and VACATES its previous Order
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and GRANTSthe plaintiffs motion.
Background 
After Deepwater Horizons explosion and the catastrophic oilspill that followed, the Secretary of Interior twice in successionimposed a blanket moratoriumon deepwater drilling in the Gulf oMexico. For the five months that the bans were in place, nopermits were issued for deepwater drilling. But, even after theSecretary formally lifted the second moratoriumon October 12,2010, permits for deepwater drilling activities have not beenprocessed; little to no deepwater drilling has resumed.
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Case 2:10-cv-01941-MLCF-JCW Document 229 Filed 02/17/11 Page 1 of 17
 
2In the past ten months, the Department of Interior and theBureau of Ocean Exploration Management, Regulation, and Enforcement(BOEMRE) have been centrally involved in plugging the culprit welland clearing the Gulf of millions of gallons of renegade oil. Thegovernment, as a result of the spill, adopted new regulationscovering drilling in the Gulf of Mexico. Operators seeking permitsto drill must comply with some of these new regulations beforetheir permit applications may be processed. Beyond these newregulations, permit applications are also subject to therequirements of the National Environmental Policy Act. Plaintifcharges the governments continuous delays are intentional. Thegovernment responds that its strained resources and the demands of regulatory compliance necessarily produce the delays at issue.Seeking action (any action) fromthe government, Ensco soughta preliminary injunction on five specific permit applications inwhich the company holds a contractual stake: Cobalts applicationfor a permit to drill on GC 814 using ENSCO 8503, filed April 30,2010; Cobalts revised application for a permit to drill on GB 959using ENSCO 8503, filed October 21, 2010; Nexens application todrill filed July 27, 2010; and two other applications filed byNexen on October 12, 2010. The government contends that four of these permits are not technically pending before it because theywere returned to the applicants with instructions to correctcertain deficiencies. But Cobalt attests that it has not received
Case 2:10-cv-01941-MLCF-JCW Document 229 Filed 02/17/11 Page 2 of 17
 
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Discounting the time the two moratoriums were inplace, all five applications have suffered delays of at least fourmonths.3any indication fromthe government about inadequacies in its permitapplications and that BOEMRE merely contacted Cobalt to informitthat its application would move to the end of the queue because of Enscos sublease of a relevant rig to an operator in French Guiana.It is undisputed that before the Deepwater Horizon disaster,permits were processed, on average, in two weeks’ time. In starkcontrast, the five permits at issue have been pending fromfour tosome nine months.
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It is also undisputed that these delays haveput off indefinitely drilling in the Gulf of Mexico. Ensco hasincurred significantly reduced standby rates on its rigs and hasbeen forced to move some of its rigs to other locations around theworld. It is unclear when Gulf drilling will resume. Thegovernments assurances have been inconsistent.At the outset, the Court denied the plaintiffs motion for apreliminary injunction because the Court had questions aboutwhether it has the judicial review authority to impose a time framefor agency decision and, if so, what a reasonable time frame wouldbe to mandate government action, whether it be denial or approvalof permit applications. The parties’ supplemental briefing hasresolved the Courts questions; the Court now RESCINDS and VACATESits Order denying without prejudice a preliminary injunction andGRANTS the plaintiffs motion for a preliminary injunction as to
Case 2:10-cv-01941-MLCF-JCW Document 229 Filed 02/17/11 Page 3 of 17

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