Mohamed Al Fayed has won more than £750,000 in damages for trespass by an oil company into oil reserves beneath his
This morning, Peter Smith J ordered that Star Energy must pay the Harrods owner compensation after it drilled diagonally under
Between 1990 and 2007, approximately 1.006m barrels of oil were extracted from wells which penetrated almost one kilometre beneath the Oxted estate, which sits on part of the Palmers Wood oilfield.
Allowing the claim brought by Al Fayed’s Liechtenstein-based company Bocardo SA, that owns the estate, Peter Smith J ruled, “I do not see how, in the present case, that the insertion of pipelines under the Oxted Estate for the purpose of removing the oil both beneath the Oxted Estate and in the remainder of the field can be anything other than a trespass.”
Accordingly, the judge held that Al Fayed was entitled to 9% of Star’s income from the wells, which amounted to £6.9m between July 2000 and December 2007, and 9% of all future income from that date until the oil and gas extraction is exhausted.
Julian Cridge, head of property litigation at Denton Wilde Sapte, who led its team during the case said: “This is a landmark legal decision. It is the first case to consider trespass to land at great depths. It may mean that other landowners will need to consider whether they have claims against companies that have drilled or intend to drill under their land.We are very pleased with the outcome after what has been a long and hard fought battle.”
Bocardo SA v Star Energy UK Onshore Ltd and another Chancery Division (Peter Smith J) 24 July 2008
Jonathan
