The United States Department of Justice, in a case of first impression, attempted to hold a landowner responsible for the Coast Guard’s response costs in the clean up of abandoned oilfield equipment in United States of America v. Louisiana Land & Exploration Company, USDC, Eastern District of Louisiana, No. 03-3208, Section “L”. Defendant LL&E was the surface owner of the property, which it purchased subject to an existing mineral lease. The lessee had engaged in operations for several years and had installed wells, tanks and other drilling and exploration equipment on the property. Although the operator allegedly ceased operations, LL&E never received any notification that the lease was being terminated.

In 2001, the US Coast Guard reported an oil spill from a storage tank on the property. Because the property allegedly was located in marshlands adjacent to a bayou which drained into the Gulf of Mexico, the US Coast Guard initiated clean up pursuant to the Oil Spill Pollution Act of 1990 (“OPA 90″). Upon completion, it sought to recover response costs of approximately $800,000 from the landowner under the theory that the operator had abandoned its equipment and that, pursuant to OPA 90 and La. C.C. art. 493, LL&E became the owner of this equipment when the lease “terminated” and was therefore responsible for all damage it caused.

Continue Reading LANDOWNER NOT LIABLE UNDER OPA 90 FOR ABANDONED OILFIELD EQUIPMENT