U.S. government has agreed to pay major oil companies $198 million for not allowing them to drill federal leases off Alaska and Florida.
The companies bought 23 leases in Alaska's Bristol Bay and 73 leases off Southwest Florida in the early 1980s, but congressional moratoria prevented them from drilling the tracts.
The companies sued in federal Court of Claims in 1992, alleging losses of about $600 million. Shell Oil Co. and Oxy Inc. recently settled separately out of court.
The latest action resolves the Court of Claims lawsuit regarding the Alaska and Florida leases but not some of the companies' claims covering leases they hold off North Carolina but are blocked from drilling.
Under the settlement, Conoco Inc. will relinquish its leases off Alaska and Florida and associated claims for $23 million, which the government will pay partly in cash and partly by foregoing royalties.
Conoco dropped its damage claim for not being allowed to drill off North Carolina but did not surrender those leases.
The Interior Department also settled collectively with Amoco, Chevron, Mobil, Murphy, Pennzoil, Union, and Texaco. Those companies will receive a combined $175 million for returning leases and dropping claims off Alaska and Florida but not North Carolina.
A Minerals Management Service spokeswoman said, "We're still pursuing negotiations on North Carolina. It's a lightly different mix of seven companies.holding 53 leases."
MMS has said there are strong indications some of the North Carolina leases overlie a large gas prospect.
Chevron U.S.A. Production Co. will get about $65 million. Pres. Ray Galvin said "Although we agreed to resolve a portion of our claim, ultimately we remain disappointed over the government's policy toward exploration of important U.S. oil and gas prospects.
"For us, the settlement only represents partial compensation for our investment in the leases. We would much prefer the right to explore and develop U.S. energy sources."
GOVERNMENT ENDORSEMENT
The government move brought praise from federal and state officials.
Interior Sec. Bruce Babbitt said, "This administration strongly opposes offshore development in environmentally sensitive areas. This settlement with the nine companies closes the door for oil and gas development off the Everglades and in Bristol Bay now and for the foreseeable future."
President Clinton said, "This settlement is good for the environment, good for taxpayers, good for the economy, and fair to the oil companies.
"Concern for our coasts is part of the common ground we share as Americans, not only in the areas protected today, but in places as different as California, Massachusetts, Oregon, New Jersey, and Washington. Once sensitive areas are damaged -beaches, the fishing industry, tourism - our natural heritage suffers greatly"
Florida Gov. Lawton Chiles said, "Our pristine coastline is a great asset to Florida's quality of life. That's why we will continue to fight to protect it so we can preserve it for future Florida generations."
Chiles will continue to seek a ban on drilling within 100 miles of the Florida coast.
Alaska Gov. Tony Knowles said, 'Prudent management of our resources means striking a balance, but in Bristol Bay it just wasn't there. The prospect of discovering oil was slight, and it was far outweighed by the value of Bristol Bay's fisheries."
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