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

To: Rob Skaff who wrote (725)	3/27/1999 9:06:00 PM
From: Edwin S. Fujinaka	Respond to of 4686

Hi Robb,...Here's Matt Moore's article: Friday, March 26, 1999 Coastal appealing state's denial of drilling permit MATT MOORE Business Editor Coastal Petroleum Co. announced it is moving forward on its appeal of a decision by the state to deny it an offshore drilling permit. The Apalachicola-based company said oral arguments would begin May 12 in the state's First District Court of Appeals. The company had sought a permit from the Florida Department of Environmental Protection to drill an exploratory well off the coast of St. George Island, but was denied that by the State Cabinet. Late last year, an administrative law judge said Coastal was entitled to the permit, but DEP declined to issue the permit, the third such denial the agency made. That refusal and a surety bond mandated by the Cabinet of $4.25 billion, will be argued during the appellate court hearing, said Phillip Ware, Coastal's president. Ware also said the company's request for 12 other drilling permits in other areas - also denied by DEP - are being reviewed by the State's Division of Administrative Hearings "with a ruling expected shortly." Coastal, a majority-held subsidiary of Coastal Caribbean Oils & Minerals Ltd. Of Bermuda, holds the drilling rights to an 800,000-acre offshore leasehold just of Florida's Gulf Coast. The leasehold stretches from St. George Island to Naples. The state banned offshore drilling in 1990, but Coastal was grandfathered in because it has held the leases since the 1940s. Earlier this year, a petroleum geologist said initial seismic surveys of the company's St. George Island leaseholds revealed the possibility of more than five billion barrels of crude oil between 12,000 and 18,000 feet below the sea floor. The only way to verify that would be to drill an exploratory well, the company said. ----------------------------------------------------------------------

To: Rob Skaff who wrote (725)	3/28/1999 6:24:00 PM
From: Edwin S. Fujinaka	Respond to of 4686

Robb,...I decided to send Matt Moore (of the Panama City News Herald)the two stories on CCO that seem to indicate the direction that the lawsuit might take. The first story is the February 8, 1999 Oil and Gas Journal story by a geologist that estimates that Coastal Petroleum may be sitting on "tens of billions of barrels of oil". The second story is the Detroit Free Press article on the Miller Brothers versus the State of Michigan lawsuit that resulted in the State of Michigan paying $90 million to Miller Brothers for preventing them from drilling for an estimated 10.8 million barrels of oil. Note that CCO may have a thousand times more oil than was involved in the Michigan case. Note also that the $90 million dollar payment to Miller brothers is almost twice the market cap for CCO (with around 40 million shares outstanding). I suggested to Matt that the Florida taxpayers could be in for a shock if the Florida litigation comes even close to the Michigan results.

To: Rob Skaff who wrote (725)	3/28/1999 7:09:00 PM
From: Edwin S. Fujinaka	Read Replies (1) \| Respond to of 4686

Robb,...Matt Moore said that he had interviewed Jamil in February about the Oil & Gas Journal Article. Here's Matt's original article: newsherald.com Friday, February 12, 1999 Geologist: Oil reserves gigantic off Gulf and Franklin counties MATT MOORE Business Editor News Herald Graphics A petroleum geologist said Thursday that undersea oil deposits off the coast of Gulf and Franklin counties and extending to Naples may well be the largest untapped reserves discovery in U.S. history. "I looked at the seismic data and said, 'Oh my god!"' said Jamil Azad of Calgary, Alberta-based Azad Exploration Limited. "Potentially, it's as big as the North Slope and it's totally unexplored, which I found to be extraordinary," he said. "It's very good and the smackover, it's full of oil." If Apalachicola-based Coastal Petroleum Co. can get to it, the small subsidiary of Bermuda-based Caribbean Oils & Minerals Limited could find itself the darling of the petroleum industry. But that hinges on whether it can win a protracted legal battle with the State of Florida for drilling permits, said Phillip Ware, Coastal's president. "What we're really waiting on now is the First District Court of Appeals to set a date for oral arguments on the (Florida Department of Environmental Protection's) latest denial on the St. George Island permit," Ware said. "The administrative hearing was in October." Coastal has had legal rights to a 425-mile long stretch of leaseholds from St. George Island to Naples for nearly a half-century. The company, however, hasn't been able to drill because of a federal executive order banning offshore drilling, as well as a similar 1990 state mandate. Coastal seems legally exempted because it already had "ownership" of the leaseholds, but has still faced strong state regulatory opposition. Ware said the company expects some sort of ruling by spring as to whether it can drill an exploratory well off the coast of St. George Island to confirm its seismic findings that approximately 3 billion barrels of oil could be pulled from underneath the sea floor. Azad, however, said that figure could be more like tens of billions of barrels. "It's well within drilling. Just a few million dollars to make the hole," he said. Based on the seismic data, the oil is between 12,000 and 18,000 feet below the sea floor, a distance that is easily drilled with today's technology. Only if the permit to drill an exploratory well is issued - either through legal action or a change of heart by the state - can the company know for sure, Ware said. Any decision will hinge on the appeal the company filed after the state Cabinet required Coastal to post a surety bond of $4.25 billion to help pay cleanup costs in the event of an accident. Ware said that figure was ludicrous and designed to keep the company from ever taking up a drill bit. "What's at stake is enormous," he said. Ware said he was optimistic about the permit when Republicans took over the state government in January, but now realizes the stakes are high for a politician coming out in favor of offshore drilling. "Obviously Gov. Bush is in an extremely difficult political situation. There's no way any elected politician can endorse offshore drilling," he said. "It would be political suicide." The only viable option, he said, would be to get a court-ordered decision to force DEP to issue the permit. "(We need) some degree of fairness which has been completely lacking in our dealings with the state so far," Ware said. "We're not giving up." If a permit to drill the well were issued, Coastal Petroleum would likely team with a larger company with more on-hand capital to cover the costs associated with drilling. Azad's findings have caused the stock of Coastal Caribbean to surge in the last five days. The stock, traded on the Boston Exchange, had been hovering at around 1-1/4, but rose as high as $2 per share. The volume increased from an average of 6,000 shares traded daily to nearly 40,000 a day. -------------------------------------------------------------------------------- Advertising \| Archives \| Business \| Classifieds \| Deaths \| Education \| Entertainment \| Food \| Freedom \| Gen Extra \| Gen Next \| Letters \| Lifestyle \| Local News \| Lotto \| Messages \| Net Effect \| NIE \| P.C. Links \| Question \| Religion \| SmartFinder \| Sports \| Subscriptions \| Viewpoint -------------------------------------------------------------------------------- © 1999 The News Herald Copyright Notice