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Originally published June 22, 2010 at 7:55 PM | Page modified June 23, 2010 at 8:32 AM

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Judge lifts Obama's ban on offshore oil drilling

A federal judge Tuesday struck down the Obama administration's six-month moratorium on deep-water drilling in the Gulf of Mexico, saying...

Los Angeles Times

Other developments

British response: Oil executives meeting in London sent a strong challenge to President Obama, warning at a major oil conference that his ban on risky deep-water drilling would cripple world energy supplies. BP's stock slid to a 13-year-low in London and near a 14-year low in the U.S.

Containment: Coast Guard Adm. Thad Allen said Tuesday that a containment device had collected nearly 1.1 million gallons in 24 hours.

Oxygen reduced: A marine scientist says underwater oil plumes are reducing oxygen in parts of the Gulf of Mexico, but the drop-off isn't steep enough to endanger marine life just yet. Samantha Joye of the University of Georgia said Tuesday that water samples show oxygen concentrations within the plumes are dropping 1 to 2 percent each day. Scientists say if that process goes too far, it could create "dead zones" with so little oxygen that virtually nothing could live.

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ATLANTA — A federal judge Tuesday struck down the Obama administration's six-month moratorium on deep-water drilling in the Gulf of Mexico, saying the government likely acted "arbitrarily and capriciously" in imposing the halt.

U.S. District Court Judge Martin Feldman's strongly worded, 22-page order amounted to a stinging rebuke of a central element of the Obama administration's response to BP's ongoing oil leak in the Gulf. A White House spokesman said the administration would file an immediate appeal.

Interior Secretary Ken Salazar said he will issue a new order imposing a moratorium that will contain additional information making clear why the six-month drilling pause was necessary in the wake of the Gulf oil spill. The New Orleans judge who struck down the moratorium earlier in the day complained there wasn't enough justification for it.

Salazar pointed to indications of inadequate safety precautions by industry on deep-water wells, and said he would issue the new order in the coming days.

In announcing the appeal, White House spokesman Robert Gibbs said, "The president strongly believes, as the Department of Interior and the Department of Justice argued yesterday, that continuing to drill at these depths without knowing what happened ... potentially puts the safety of those on the rigs and safety of the environment in the Gulf at a danger that the president does not believe we can afford right now."

Feldman's order granted a preliminary injunction to the plaintiffs in the case, a group of oil-services-support companies headed by Hornbeck Offshore Services of Covington, La.

Neither Justice Department nor Minerals Management Services officials returned calls inquiring about the ruling's immediate effect on Gulf drilling. But Catherine Wannamaker, senior attorney at the Southern Environmental Law Center, believed it meant that drilling could resume immediately — although she said that as a practical matter, companies might hold off until there was some clarity about the appeals process.

Wannamaker, who argued before the court on behalf of intervening environmental groups, said it was likely that the defendants could seek a stay from Feldman, which could continue the drilling ban until the case is resolved by the 5th U.S. Circuit Court of Appeals.

In the order, Feldman called the Deepwater Horizon spill "an unprecedented, sad, ugly and inhuman disaster." But he took the government to task for overreaching in its May 28 moratorium, which suspended all current or pending deep-water drilling operations in the Gulf, putting 33 rigs temporarily out of service.

That "blanket moratorium, with no parameters," Feldman wrote, "seems to assume that because one rig failed and although no one yet fully knows why, all companies and rigs drilling new wells over 500 feet also universally present an imminent danger."

Elsewhere, he wrote: "If some drilling-equipment parts are flawed, is it rational to say all are? Are all airplanes a danger because one was? All oil tankers like Exxon Valdez? All trains? All mines? That sort of thinking seems heavy-handed, and rather overbearing."

Feldman agreed that the plaintiffs would suffer "irreparable harm" from the moratorium, noting that the movement of the big rigs to other points around the globe "would clearly ripple throughout the economy in this region."

He also blasted the government for asserting, in a post-explosion report on Gulf drilling policy that Obama had commissioned, that the call for a moratorium had been peer-reviewed by seven expert engineers. Feldman noted that five of those experts agreed only with a "much more limited kind of moratorium."

In the restrained language of the court, Feldman suggested the government was playing dirty, writing that its handling of the issue "might cause some apprehension about the probity of the process."

Conflict of interest?

Questions also arose Tuesday about Feldman and his previous ties to oil and gas companies that may be affected by his ruling. A financial-disclosure report for 2008 showed that he held investments in Transocean, one of the world's largest drilling companies and the owner of the Deepwater rig, as well as a number of other energy companies.

Kate Gordon, vice president of energy policy for the liberal Center for American Progress, said that the judge's holdings in Transocean were particularly disturbing. Transocean spokesman Guy Cantwell said the company had 14 rigs in the Gulf that were affected by the moratorium.

"Every day (Transocean) isn't getting its daily rental fees their profits go down, and every day their profits go down is bad for their shareholders," Gordon said. Feldman, she said, "has got a clear conflict."

But other ethics watchdogs, including Tom Fitton, president of Judicial Watch, said that little could be made of the document — the latest to be released by the federal courts — because it was not clear if Feldman was still invested in the companies.

Energy policy

Mixed reaction from within the president's own party also underscored the challenge facing Obama as he tries to revamp national energy policy in response to the spill. The ruling came a day before the president is scheduled to meet with lawmakers on energy policy.

Sen. Mary Landrieu, D-La., said she would urge the administration not to appeal the ruling but to find a way to achieve its goal of ensuring safety without harming her state's fragile economy.

Another Louisiana Democrat, Rep. Charlie Melancon, said the ruling was "encouraging" for Louisianans whose jobs depend on the oil and gas industry and expressed hope Obama wouldn't fight it.

"As long as the administration is appealing the decision, the future of energy production in the Gulf remains unclear," he said. "I hope the president will stand with the thousands of Louisiana families who have spoken loudly with one voice about the dangers this moratorium poses to our economy and order his administration not to appeal today's decision."

But Sen. Frank Lautenberg, D-N.J., called the ruling "incredibly shortsighted," given that oil is still gushing into the Gulf. Sen. Patty Murray, D-Wash., added: "We shouldn't even consider putting our environment, our economy, or our workers at risk on deep-water drilling projects until we know what caused this tragedy in the Gulf Coast, and until we understand exactly how to prevent anything like it from ever happening again."

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