Hearings began Tuesday for the case in which Exxon-Mobile, the country’s largest oil producer, has been accused of intentionally sabotaging South Texas oil wells by fraudulently plugging them up and then attempting to cover up the damage.
"Exxon committed irrefutable, intentional and flagrant violations of state rules regulating the oilfield," Jerry Patterson, Commissioner of the Texas General Land Office, said. "The Texas Railroad Commission should act to enforce its own rules."
Patterson requested in July that the Texas Railroad Commission hold hearings about the matter. If Exxon-Mobil loses the case, they could face fines exceeding $1 billion: $10,000 per well, per violation, for every day since 1992.
The alleged sabotage took place over a dispute with the O’Connor family, with whom Exxon-Mobil negotiated a lease for their oil-rich acreage in Refugio County. When the relationship soured, Exxon-Mobil terminated the lease and plugged the wells, filing all of the legally-required paperwork outlining their well-plugging procedures and signing sworn affidavits regarding their conditions. However, it was soon discovered that those reports were fraudulent.
When a new company, Emerald Oil, went to re-open the wells as per new legislation, they discovered that the wells had been sabotaged rather than closed properly. They were filled with junk, cut well casings, contaminated oil tank sludge and even explosives.
Exxon Mobil acknowledges that it plugged the wells in the 1990s after concluding that it "was no longer economically feasible" to produce the O’Connor oil and gas leases.
"The area in which the wells are located has a water table very close to the surface," Exxon Mobil said in a statement to the Ft. Worth Star Telegram from corporate media adviser Margaret Ross. "As a result, it was critical that Exxon protect the groundwater by plugging the wells solidly and thoroughly.
"If there is a belief that more production can be obtained from the land, one does not have to re-enter the same well but has the option to drill a new well," the statement said.
Holly LaFon has written and worked for various local publications including D Magazine and Examiner.