A federal court in Louisiana has held the U.S. Department of Interior (DOI) in contempt for reinstating a six-month ban on deepwater drilling in the Gulf of Mexico after the court ordered the lifting of a prior moratorium in June 2010. Hornbeck Offshore Servs. v. Salazar, No. 10-1663 (E.D. La. 2/2/11). DOI issued the second six-month ban after the court struck down the original moratorium, which was imposed after the April 20, 2010, explosion and oil spill at the Deepwater Horizon oil rig in the Gulf of Mexico. After the court enjoined the first moratorium, DOI filed an appeal with the Fifth Circuit Court of Appeals, which denied the appeal in July. DOI issued the second moratorium on July 12 and suspended it on October 22.
The first moratorium prohibited companies from drilling exploratory wells in water depths greater than 500 feet for six months. The second moratorium restricted the use of subsea oil well blowout preventers or surface blowout preventers on floating facilities, regardless of water depth. Hornbeck Offshore Services challenged the first moratorium arguing that it was “invalid and unenforceable” and a violation of the Outer Continental Shelf Lands Act and its regulations. Hornbeck also challenged the second moratorium and sought reimbursement of its attorney’s fees under either a contempt theory or a common law claim of bad faith.
In its decision, the court found “clear and convincing evidence” that DOI showed “dismissive conduct” in proceeding with the second moratorium. The court therefore granted Hornbeck’s motion for attorney’s fees. According to press reports, trial in the matter is expected later in 2011. See BNA Daily Environment Report and Jurist, February 4, 2011.