U.S. sued over drilling ban

06 19, 2012 by UPI

An energy explorer working in the Gulf of Mexico sued the U.S. government for what it said was the illegal suspension of drilling operations in 2010.

Offshore oil and natural gas production company ATP Oil and Gas Corp. sued the U.S. Interior Department in a federal court in Washington.

The lawsuit claims the U.S. Interior Department "improperly and illegally" placed a moratorium on offshore drilling activity in the Gulf of Mexico after the 2010 disaster at the Deepwater Horizon rig, the Platts news service reports.

The Deepwater Horizon rig caught fire and sank in April 2010, leading to one of the most catastrophic oil spills in the history of the industry. The U.S. government lifted the subsequent moratorium on offshore oil and natural gas drilling in October 2010, though drilling permits weren't issued until March 2011.

ATP alleges it lost more than $60 million as a result of the moratorium after it canceled a rig contract and continued paying for two idled rigs.

ATP sued the Interior Department once before because of the delay in issuing drilling permits after the October moratorium was lifted.

More than 38 million offshore acres are up for bid in a Wednesday auction planned in New Orleans. The U.S. government estimates the sale could result in the production of more than 1 billion barrels of oil and 4 trillion cubic feet of natural gas.