Title: $4.3 Billion Bond Asked for Drilling
Full Citation
Permanent Link: http://ufdc.ufl.edu/WL00005000/00001
 Material Information
Title: $4.3 Billion Bond Asked for Drilling
Physical Description: Book
Language: English
Publisher: Tampa Tribune, July 22, 1997, by Gady A. Epstein
Spatial Coverage: North America -- United States of America -- Florida
Abstract: Jake Varn Collection - $4.3 Billion Bond Asked for Drilling (JDV Box 40)
General Note: Box 30, Folder 8 ( Newsclippings from Various Newspapers - 1997 ), Item 3
Funding: Digitized by the Legal Technology Institute in the Levin College of Law at the University of Florida.
 Record Information
Bibliographic ID: WL00005000
Volume ID: VID00001
Source Institution: Levin College of Law, University of Florida
Holding Location: Levin College of Law, University of Florida
Rights Management: All rights reserved by the source institution and holding location.

Full Text

$4.3 billion bond

asked for drilling

SUMMARY: A state agency recom-
mends that Lykes Bros.-backed
Coastal Petroleum post a $4.3 billion
bond before drilling offshore.
of The Tampa Tribune

leaders are once again trying to
ensure that a small oil company's
bid to drill in state waters comes
up dry.
The Department of Environ-
mental Protection on Monday rec-
ommended that Coastal Petroleum
be required to post a nearly $4.3
billion environmental insurance
bond before it can get a permit to
drill south of St. George Island in
the Panhandle.
The governor and Cabinet,
which tried to impose a bond of
nearly $2 billion on the small Apa-
lachicola company two years ago,
are expected to approve the rec-
ommendation at an Aug. 12 meet-
State officials and environmen-
talists hope the bond requirement
will doom Coastal Petroleum's
five-year pursuit of a drilling per-
mit Th-py 'ry the rr'mpny, nprtIh


4 From Page 1
State officials say the bond
would cover cleanup costs and en-
vironmental damage from any
"maximum" oil spill that may oc-
cur a spill that could conceiv-
ably stretch west to Pensacola and
southeast as far as Pasco County,
and threaten beaches, salt marsh-
es, sea life and the oyster-rich es-
tuary of Apalachicola Bay.
The state based its calculations
on a 140-million gallon oil spill off
the Gulf Coast of Mexico in 1979.
Few expect Coastal Petro-
leum's exploratory well ever to
come up with nearly that much oil,

owned by the Tampa-based Lykes
family agricultural empire, is in-
terested not in drilling for oil but
in using the threat of drilling to
compel the state to buy its oil and
gas rights.
The company has never pro-
duced a drop of oil and has virtual-
ly no assets other than the petro-
leum rights to more than 800,000
acres of submerged lands lying
seven to 10 miles off the Gulf
"Coastal's a shell corporation,
and if they have to be financially
responsible, they may very well
pull up their tent pegs and leave,"
said David Guest, managing attor-
ney for Earthjustice Legal Defense
Fund, formerly the Sierra Club
Legal Defense Fund.
The company earlier promised
to appeal any bond requirement to
a stale hearing officer and the
"It's sublimely ridiculous,"
company President Phil Ware said
Monday. "They're doing every-
thing to stop drilling without just
flat out denying us a permit."
See DRILLING, Page 4 >

wants bond paid
however. The extraordinary bond
is viewed by some as a political
weapon to thwart drilling, and that
the governor and Cabinet would
not be reluctant to use it.
They voted to impose a $1.9
billion bond on the company's dril-
ling request two years ago, but ap-
pellate courts threw out that bond.
This year, the Legislature passed
a law expressly giving the gover-
nor and Cabinet the authority to
impose such a bond, setting the
stage for next month's meeting.
Coastal Petroleum is the only
company to own offshore drilling
rights in Florida waters.

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