Court Lets Chevron Keep Lid on Data About Drilling in Wildlife Refuge

From Reuters

Chevron Corp. has won the first round of a legal battle to keep state officials and oil company competitors from seeing confidential data on the first exploratory well being drilled in the Arctic National Wildlife Refuge.

A state superior court judge this week issued a preliminary injunction against release of the data from the well, which is inside the environmentally sensitive refuge.

While state law provides for release of certain well data, the oil company argued that the information was proprietary and that competitors should not be able to see it.

The court's decision bars state officials from getting information from the 14,500-foot-deep well, known as KIC Jago River, until a court decides whether they have a right to it.

The Arctic National Wildlife Refuge is just east of Prudhoe Bay, which produces about 1.8 million barrels of oil a day.

The oil industry has been campaigning to get the region opened to exploration, but environmentalists charge that exploration will harm wildlife in the area.

On Wednesday, a study by the U.S. Fish and Wildlife Service showed that opening Alaska to oil development had caused more environmental damage than had been foreseen in early impact studies.

The study was not officially released because of a dispute within the agency about the validity of the findings about the Prudhoe Bay area, but the report is still expected to harden opposition to developing the wildlife area.

Last month, Chevron and its partner Standard Alaska Production Co., a unit of British Petroleum Co., along with the owner of the land, Arctic Slope Regional Corp., sued to prevent the state from revealing information when a two-year period of confidentiality expires May 24.

Arctic Slope represents native Alaskans.

State law provides that the data, in custody of the Alaska Oil and Gas Conservation Commission, would become public in two years unless the state Division of Oil and Gas rules that the well produced significant information that should remain confidential. Jim Eason, director of the Division of Oil and Gas, said his agency should have the right to review the data. Eason said his agency could use the data to help judge the value of nearby state land and eventually make the information public.

"Public information concerning the subsurface of Alaska's lands will promote interest in leasing, increase competition and encourage early development of oil and gas," Eason said.

The oil companies argued that no one, including state agencies, should be able to gain from the KIC data without first compensating those who spent nearly $50 million to drill the well.

The judge, in approving the injunction, agreed that Chevron had raised "serious and substantial questions" about the constitutionality of state laws that allow public disclosure of well information from private land.

"If the KIC data is disclosed to the public or to the state Division of Oil and Gas before this litigation is concluded, the plaintiffs will suffer irreparable harm," the judge wrote.

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