Patterico's Pontifications

6/4/2010

The Deepwater Horizon Interest Owners

Filed under: Environment — DRJ @ 1:30 pm



[Guest post by DRJ]

Anadarko Petroleum Corp. reportedly owns a 25% non-operating interest in BP’s Deepwater Horizon well. In general, a non-operating interest is a passive interest where the owner doesn’t have authority to make decisions regarding how the Operator (in this case, BP) drills the well.

Non-operating interest owners can profit from a good well but they lose their investment if a well is dry. But wells like the Deepwater Horizon are a nightmare for non-operating interest owners: The blowout and resulting damage has already cost Anadarko and the other interest owners billions in market value and the decision to invest in BP’s well may very well impact Anadarko’s future.

So this is bad news for Houston companies like Anadarko but if these legal cases are consolidated in a Houston court, it will keep several Houston law firms busy.

— DRJ

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