I just sent your WSJ Reporter, Chip Cummings, an Email that included the following comments along with the references to the Oil & Gas Journal Article, the Detroit Free Press Article and the entire Appeal court Ruling:
A story about “the largest oil find West of the Mississippi” containing “tens of billions of barrels of oil” has been totally ignored since it was first published in the Oil & Gas Journal of February 8, 1999. I’ve attached a reference to this article along with two additional references that indicate how a valuation approaching $100 Billion might be projected.
The dollar valuation may be important to other than investors and oil developers since development is currently in litigation between the Company, Coastal Caribbean Oil & Minerals (CCO or COCBF) and the State of Florida. Environmentalists and the State of Florida have been trying to prevent the Company from drilling on it’s leases in State waters just off the Gulf Coast of Florida. The irony is that the State of Florida originally sold these oil leases in the ‘40s and has been trying to prevent drilling for just about half a century.
The second reference is to an article published in the Detroit Free Press on May 9, 1998 discussing another case that occurred in Michigan where the State prevented Miller Oil Company from drilling for 10.8 million barrels of oil. Michigan eventually settled by paying Miller Oil about $90 million in that inverse condemnation case. The Florida oil find may be a thousand times greater than Miller Oil’s property in Michigan.
The third reference is to a Florida Appeals Court Ruling from October 6, 1999. A three Judge Panel ruled that the State of Florida did indeed have the power to “take” CCO’s property right to drill, but they concluded that “just compensation” had to be paid. The last paragraph of their ruling is as follows:
“With respect to the constitutional challenge to DEP's interpretation of the statute, the issues of contract impairment
and taking go hand-in-hand. There is no dispute that the appellant has a viable contract with the State of Florida to explore for and extract oil from submerged sovereignty lands. DEP's interpretation and application of the permitting statute, based on its determination that there is a compelling public purpose in not allowing the appellant to drill off shore, effectively prevents the appellant from exercising its rights under the contract. DEP's action would be unconstitutional only if just compensation is not paid for what is taken. Fla. Const. Art. X, § 6. This is a matter to be resolved in the circuit court.
AFFIRMED.
BOOTH and WOLF, JJ., CONCUR.”
Whether “just compensation” will rise to the $100 billion valuation (which is about 1000 times what Miller Oil received from the State of Michigan) is a matter for litigation with formal appraisals of the value of the property lost through effective condemnation. As suggested by the Appeals Court, this matter should be resolved by the circuit court. The recently hired lawyer for CCO, S. Cary Gaylord, should be filing an inverse condemnation lawsuit in the Florida circuit court very soon. You might contact him to determine a time frame.
I don’t really believe that $100 billion is a realistic estimate of value for the leases themselves. It could be argued that the value of the oil in question should be used to value the losses to CCO. Perhaps even larger numbers could be argued in that case. This is for the lawyers and the courts to decide.
If you research this story before the suit is actually filed in the circuit court, it may give you a leg up. In terms of National Security, how can such a potential large oil supply be ignored? |
