U.S. loses — for now — on drilling
on Jul 9, 2010 at 12:35 am
Acting shortly after holding a hearing on the Obama Administration’s plea to delay any new deepwater oil drilling in the Gulf of Mexico, the Fifth Circuit Court on Thursday ruled that — for the time being — the moratorium must remain on hold.  In a two-page order (found here), the Circuit Court said that the Interior Department “has made no showing that there is any likelihood that drilling activities will be resumed” while the moratorium dispute is on appeal. The order was in a form that would make it difficult for the Administration to proceed immediately to the Supreme Court.
The Circuit Court did not say that drilling at depths of 500 feet or more could go forward, and, in fact, it told the Administration that it “has the right to apply for emergency relief” if it can show that such drilling “has commenced or is about to commence.” If such a new plea is filed, it added, it would be “evaluated on existing circumstances.”
The order refusing to temporarily set aside a federal District judge’s ruling that no case had been made for the moratorium split the Circuit Court panel 2-1. Circuit Judges W. Eugene Davis and Jerry E. Smith supported that part of the order, but Circuit Judge James L. Dennis did not. Dennis said he would have given the government an order to set aside temporarily District Judge Martin L.C. Feldman’s order against the moratorium, while the appeal proceeded. Dennis said he would explain his reasons “at a later date.”
The panel was unanimous in allowing the Administration to seek emergency relief in the event drilling should appear to be starting up anew, and it was unanimous in ordering that the Administration’s legal challenge to Judge Feldman could go forward on its merits, on an expedited basis. Briefing is to be on a speeded-up schedule so that an oral argument could be heard during the week of Aug. 30.
The issue in those briefs and in the oral argument will be the legal validity of Judge Feldman’s order blocking the moratorium issued by the Administration after the April 20 blowout of the Deepwater Horizon well in the Gulf.  At issue in Thursday’s hearing before the panel, and in the order it issued, was whether to stay Judge Feldman’s action pending appeal.
Although some early news accounts suggested that the Circuit Court had opened the way for deepwater drilling to resume, that does not appear to be an accurate interpretation, unless actual drilling could get started before the government had time to ask for an emergency stay order.  One of the arguments made in filings in the case before the Circuit Court by oil industry-related companies was that the Interior Department had not shown that drilling of new wells could actually be completed before the six months had expired, so no moratorium was needed. The Circuit Court panel appeared to have been persuaded on that point.
