Judge rules for Oenga family

Jack McNeel, Today correspondent | January 07, 2011

SEATTLE – The federal court in November issued a 168-page detailed decision regarding the Oenga v. United States and BP case. That decision stated the BP lease of the Oenga Native Allotment and overseen by the BIA only authorized use by BP on a limited area and did not include the Raven oil field.

A recent directive formally ordered BP to halt oil production from the Raven oil field in Alaska’s Prudhoe Bay. This is a major victory for the Oenga family’s case against BP in a long running controversy brought by the family to recover money they feel is owed them by the oil company. It’s expected the court will declare a dollar amount in this case sometime in February.

This directive gives BP the option of halting production from the Raven oil field or face cancellation of the lease for the entire Greater Niakuk area. The Raven Oil field alone has produced $35 million to $40 million worth of oil in the past two years. The Greater Niakuk area produces two to three times that amount of oil and would also stop production by two other major oil companies. The loss of income would be many times what it would cost to settle with the Oenga family.

Several stories in ICT since 2006 have outlined the reason for the case. The Oenga family is Inupiat and own land projecting into the Arctic Ocean which Andrew Oenga leased to BP in 1989. Oenga passed away a year later and his descendants brought suit because BP had not followed compliance with the lease by subleasing to other companies and by expanding to oil fields beyond what the lease spelled out. Over the past 17 years some $2 billion worth of oil has been produced here but payments to the family do not reflect that. The family maintains BP has not been paying enough rent and has used the land to produce oil from areas outside that provided in the 1989 lease.

Ray Givens, the attorney for the Oenga family, explained the court’s pending damage determination plus amounts due in other forums. “The BIA’s letter is a good first step in resolving the unauthorized use part of this case. The other part is payment of the damages, back rent and interest owed Oengas. Those claims are pending in several forums.”

“In its November opinion, the Court of Federal Claims found Oenga entitled to damages for the BIA’s failure to take action regarding the use of Oengas’ property to produce oil from unauthorized areas such as Raven. Oengas believe those damages are just under $5 million. Calculations of those damages have been filed with the court and a decision is pending.

“Using the same ‘present fair annual rental’ formula applied by the court to determine damages, Oengas believe they are owed an additional $5 million in rents for 2002-2011 and another $5 million in interests on those amounts. Those parts of the case are pending in the Interior Board of Indian Appeals and the BIA. In total, Oengas are owed roughly $15 million for damages, rent and interest for all aspects of this case pending in all forums.”

“For years we knew BP was taking advantage of us and that the BIA was letting them get away with it,” said Joe Delia, Andrew Oenga’s grandson. The case took a long time – over 16 years of arguing and five years in court. It would have been nice if the BIA had stood up to BP and taken this action years ago when we asked them to, but as they say, ‘better late than never.’ It’s nice to know that the little guy can still find justice in the courts, even against these goliaths.”

“Throughout this case, it has been the Oenga family that has been willing to talk,” said Tony Delia, another family member. “Now, BIA’s letter presents BP with two unenviable options. If BP wants to keep fighting instead of working with us, they can stop producing from Raven and appeal, or put at risk the lease for their entire Heald Point production facility. Neither of these seem very good options for BP.”

“BP has had many problems at Prudhoe Bay in the last few years with oil leaks, environmental lawsuits, criminal charges and probation violations. This Oenga situation can add to that list of problems, or it can be a problem solved. It is up to BP now.”

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