This is a good read on the different positions of "actors" regarding fracking ban. It highlights what other countries / states and authorities have done.
This article examines the position of the motives for litigation and what are the exit options for companies faced with litigation or a moratorium. In some cases in the USA companies have walked away from litigation. Others have held onto leases whilst focusing on operations in other states. I feel once the position on the licences has become clear, then it's up to LKO as to what to do. The government is liable for paying for forfeiture of licences.
I think the legal position LKO are trying to argue is one of “force majeure”—an unpredictable situation beyond the company’s control which prevented it from drilling. The legislation has created a massive legal ambiguity. Whereby wells that by way of it's contract LKO are responsible for managing, given they haven't given up the leases. Yet the government is seeking to change the statuses arbitrarily. So If we get clarification as to whether LKO has the right to keep the leases and manage the well statuses, then fine. I can't see any earth shattering ruling come tomorrow.
They feel and have argued that the current legislation has created an ambiguity to which they have sought clarification and to which in the previous ruling the judge failed to address.
I've not had sight of the grounds for appeal other than the what the CEO has listed. But if the argument of "force majeure" is used then perhaps this will allow the judges to provide some form of clarification on the legal position of the the leases. The moratorium is valid.
LKO Price at posting:
0.2¢ Sentiment: Hold Disclosure: Held
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