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Common goal: settle Alaska field dispute DNR, Exxon together ask state Supreme Court for more time to continue Point Thomson talks; Gov. Parnell personally involved Wesley Loy For Petroleum News
Lawyers for the Alaska Department of Natural Resources and oil giant ExxonMobil recently reaffirmed they’re working hard to resolve the conflict for control of Point Thomson, an undeveloped oil and gas field on the eastern North Slope.
The two sides made their objective clear on Oct. 19, filing a joint motion to again delay proceedings in the Alaska Supreme Court so they can concentrate on settlement talks.
“DNR and ExxonMobil agree that the additional extension will enable DNR to apply its limited resources to the settlement effort, and for all parties to participate in ongoing settlement discussions without incurring unnecessary expense,” the motion said.
Where the case stands The Point Thomson matter landed in the Supreme Court in late May, when justices granted DNR’s petition for review of an unfavorable lower court ruling.
It was up to DNR to file a key document, an opening brief, to kick off the high court review.
But in August the court granted DNR more time to file its brief.
Now, with the Oct. 19 motion, DNR and ExxonMobil are asking to extend the filing deadline by another three months, to Feb. 1. Two other Point Thomson leaseholders, BP and ConocoPhillips, don’t oppose the motion. A third leaseholder, Chevron, initially took no position but since has informed the court it too is unopposed.
“DNR and ExxonMobil have made progress in the settlement talks but recognize that additional time is needed to resolve this complex matter involving more than 100,000 acres of state land and 30 plus state oil and gas leases,” Assistant Attorney General Richard Todd said in an affidavit accompanying the motion.
ExxonMobil, the Point Thomson operator, and the three other major leaseholders had urged the Supreme Court to deny DNR’s petition for review.
The subject of the state’s appeal is Superior Court Judge Sharon Gleason’s Jan. 11 reversal of DNR Commissioner Tom Irwin’s termination of the Point Thomson unit. The state believes Gleason erred and wants the Supreme Court to overturn her.
Point Thomson’s significance Considerable pressure exists to resolve the Point Thomson dispute.
The state for decades has tried to encourage, demand or force the leaseholders to drill and develop the field, believed to hold hundreds of millions of barrels of petroleum liquids plus an estimated 8 trillion cubic feet of natural gas — about 25 percent of the North Slope’s known conventional gas resource. Point Thomson gas is considered important for supporting a proposed multibillion-dollar gas pipeline.
Tired of waiting and declaring that ExxonMobil had made a “mockery” of its obligations to the state, DNR officials in 2005 began moving to break up the Point Thomson unit and invalidate the underlying state leases.
ExxonMobil and the other leaseholders in turn have been fighting through administrative and court proceedings to hang onto the enormously valuable asset.
And ExxonMobil recently has drilled a pair of wells on two of Point Thomson’s leases in an effort to demonstrate it’s now willing to pursue a gas condensate development. The company has pledged to start production by the end of 2014.
Gov. Sean Parnell, running for a new term, has made repeated public statements that he wants the Point Thomson matter settled. In an Oct. 15 speech to the Resource Development Council for Alaska, Parnell remarked: “I’ve been personally engaged in discussions to resolve that litigation and I’m positively optimistic that we’ll get there soon.”
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