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Gold/Mining/Energy : coastal caribbean (cco@) -- Ignore unavailable to you. Want to Upgrade?

To: Kive I. Strickoff who wrote (1159)	12/5/1999 3:38:00 PM
From: Edwin S. Fujinaka	Read Replies (1) \| Respond to of 4686

In this type of litigation, the State of Florida could probably put off a final determination of the outcome for five more years or maybe even longer. A settlement could come much sooner if the State wanted to minimize their exposure to a pretty large final judgement. It is wrong for the State to deliberately obstruct the quick settlement of a case like this. My interpretation of the Court's preliminary ruling is that the Court is convinced that the State can only prevent drilling and development of the Coastal Petroleum leases by paying "just compensation". There is still a question as to whether that means that the Appeals Court has already declared the State's actions as a "taking" under condemnation law. I think the decision has to go back to the Circuit Court for a final determination as to whether it is a taking or not. If the State stalls and fights every inch of the way, that could actually take a couple of years to resolve. The "taking case could be appealed to the same court that just heard the appeal on the drilling question. If the State loses there, they could appeal to the Florida Supreme Court on the taking question. If CCO wins all the way, then there is the issue of valuation. That could take another year. The final outcome should be like the Miller Oil vs Michigan case where the State paid around $90 million to settle the case involving an estimated 10.8 million barrels of oil. The Coastal Petroleum case may involve a thousand times that amount of oil, but perhaps we might settle for 100 times that amount of oil. Michigan settled for $90 million because the State's Attorney advised the Governor to settle. They knew that a final Court imposed judgement would be considerable higher. Even 100 times $90 million is $9 billion. The wide range of potential valuation is what leads me to suggest that CCO unilaterally get a formal appraisal for purposes of valuing the property taken in a condemnation. That number will be much higher than the value of the leases if they were just sold on the open market. CCO needs to generate the scary big numbers so a "delay in drilling" agreement will become politically viable for a Governor to negotiate. All of the foregoing conjecture is my own personal opinion and involves a lot of guesswork. I've said it all before and I've been holding off trying to contact Jeb Bush and others until the Appeals Court hands down their final ruling. After that, I will probably try to say it to the Governor directly.