US: Exxon faces $1bn fine for 'malicious sabotage' of oil wells

Date: 17 Jul 2009

Exxon Mobil could be liable for significant penalties, said the Texas General Land Office, if allegations of intentionally damaging oil wells are proven. The company has been accused of aiming to prevent other producers from using the wells.

According to commissioner Jerry Patterson, the company filled the wells with explosives, as well as rubbish. He has asked the Texas Railroad Commission to hold hearings about the activity which he believes to have arisen from a commercial dispute between the company and the family that leased it the land fifty years ago.

The company has denied the claims, calling them 'groundless'. It said it was required to properly plug old wells to avoid groundwater seepage.

The case had previously gone to court and had been resolved against the company - a finding which was overturned by the Texas Supreme Court.

According to the General Land Office, applicable regulations can result in fines of $10,000 per well per day, which would add up to the $1bn figure quoted in its statement.

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