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Judge Rejects Demand for|Gulf Drilling Timelines

NEW ORLEANS (CN) - A federal judge declined to order the government to accelerate processing deepwater drilling permits now that the federal moratorium on such permits has ended.

U.S. District Judge Martin Feldman said that in the wake of "the appallingly catastrophic BP oil spill," and the lift of the federal moratorium on deepwater drilling in October, Ensco Offshore failed to prove unreasonable application-processing delays from the Interior Department's Bureau of Ocean Energy Management.

"Before the oil spill, the plaintiff draws attention that applications were approved or denied on average in approximately two weeks," Feldman wrote. "After the spill, plaintiff complains that no decisions on the permits are being made at all. But whether permits must be granted or denied within a specific time frame, or what time frame is reasonable remains patently unclear."

The offshore-drilling support company requested an injunction against the government for allegedly wrongful delays in issuing deepwater drilling permits in the Gulf of Mexico, but Feldman added that the court may not even have the authority to impose a time frame.

The Obama administration imposed the original moratorium after the April 20 explosion on the Deepwater Horizon drilling rig killed 11 people and set off the worst unintentional oil spill in history.

Officials defended the halt, which they said would give agents time to examine the then-current procedures and regulations imposed on deepwater drilling companies operating in the Gulf, and to tighten regulations, if necessary.

Feldman nixed the ban in June, finding that one rig explosion was not reason enough for the government to assume other rigs posed a similar threat of catastrophe. In response, the Interior Department immediately issued a second moratorium - one that offshore drilling companies, including Ensco, criticized as being nearly identical to the first. Ensco filed suit in July.

Although the moratorium officially ended in October, before the court had a chance to rule on its validity, Ensco and other opponents say the Interior Department, through its Bureau of Ocean Energy Management has been remiss in issuing new permits to drill.

Feldman said the court cannot compel the agency to move more quickly.

"The court approaches this issue with an overarching sense of caution," Feldman explained.

Thursday's ruling also rejected the defendants' motion to dismiss parts of the Ensco's lawsuit and permitted Ensco to file a second amended complaint with a new plaintiff, ATP Oil and Gas. ATP, which works in the outer Continental Shelf in the Gulf, "has entered into several oil and gas leases with the government and raises similar claims to Ensco," Feldman wrote.

The government challenged the proposed amendment, but Feldman said he would allow the change, which he called "narrow in scope."

He added that the government's request to dismiss charges from the complaint based on sovereign immunity "is unwarranted."

Over the summer, federal officials and environmental groups raised questions about Feldman's ability to impartially rule on the case, but Feldman rejected a motion for disqualification. The groups asked Feldman to step down, noting that he "owns and/or recently has owned an interest in several companies that comprise part of the network that supports the Gulf's oil and gas industry." Feldman said the concerns were "without merit."

Trial on the case is slated to begin May 16.

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