Ensco Seeks Continuation of Deepwater Drilling Challenge

(Dow Jones Newswires), Oct. 19, 2010

One of the oil companies that sued the Obama administration over its now-rescinded ban on new deepwater oil wells said Tuesday its case should continue because the drilling moratorium isn't really over.

Ensco Offshore Co., which earlier this year sued to overturn the Interior Department's deepwater drilling ban, has told Judge Martin Feldman that regulators cannot show that they have "completely and irrevocably eradicated the effects" of the moratorium.

An Interior Department spokeswoman had no comment. Justice Department spokesman Wyn Hornbuckle said "we have nothing further to add" beyond what the government said in an earlier request that the judge dismiss the lawsuit. In that request, the U.S. said the lawsuit was moot because the ban had been lifted.

On Tuesday, Feldman issued an order in which he said that he would consider on Nov. 3 issues related to the legality of the ban --the second one imposed by the Obama administration.

A deepwater drilling ban was first imposed in late May as it became clear that the BP PLC (BP, BP.LN) oil spill was becoming the worst offshore oil spill in U.S. history. The Interior Department issued a second ban, to expire Nov. 30, after Judge Feldman issued an injunction barring it from enforcing the initial ban.

U.S. Interior Secretary Ken Salazar announced on Oct. 12 that the moratorium had ended and that regulators would resume approval of drilling permits, with the first permits most likely to be approved by the end of the year. He said the permits would be subject to new safety regulations and that drilling rigs also needed to be re-inspected before drilling restarted.

"Ensco is currently being disadvantaged in the same fundamental way as under the formal moratorium: it is still unable to engage in any deepwater drilling activities barred by the moratorium," the company's lawyers wrote in a legal filing.

Copyright (c) 2010 Dow Jones & Company, Inc.

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