Judge rules against Exxon over Point Thomson leases

December 28, 2007

State of Alaska press release: Superior Court Judge Sharon Gleason ruled that the Alaska Department of Natural Resources acted properly when it rejected the 22nd Plan of Development for the Point Thomson Unit. Her decision affirming DNR's actions reflects her agreement with the arguments made by the state's attorneys.

The judge directed DNR to hold an additional hearing to provide the appellants with the opportunity to argue about what the appropriate remedy should be when the working interest owners have failed to fulfill their obligation to develop a unit.

"This ruling represents another significant step forward in the state's efforts to develop the valuable oil and gas resources in the Point Thomson reservoir and to hold the lessees to the commitments they made in the unit agreement," Governor Sarah Palin said. "We are pleased that the court has affirmed the Department's efforts to ensure that the oil and gas in this reservoir is responsibly produced."

At the remand hearing, DNR will hear and consider arguments about whether or not termination of the unit is the appropriate remedy for failure to adequately develop this reservoir; or what other action the State should take. The Department will act quickly to resolve this matter.

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