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December 20, 2005

High energy

Great news: big oil hasn’t been conspiring to drive up gas prices. It’s been conspiring to drive up natural gas prices. From the (paid-subscription) Wall Street Journal:

An Alaska state authority charged that BP PLC and Exxon Mobil Corp., the world’s largest publicly traded oil companies, are conspiring to withhold natural gas from U.S. markets and reinforce their market power over North Slope supplies.
In an antitrust suit filed late yesterday in federal court in Fairbanks, the Alaska Gasline Port Authority alleged that a series of illegal agreements and acquisitions by the companies has choked the flow of the state’s vast gas reserves. It seeks to stop the companies’ alleged collusion through a court injunction and unspecified damages.
… The Alaska Gasline Port Authority said that BP’s refusal to agree to ship its natural gas and Exxon Mobil’s failure to develop its huge fields amounts to “warehousing” a desperately needed resource in an effort to drive up prices. “Gas prices are at record highs, and big oil companies still won’t move the gas to market,” authority Chairman Jim Whitaker said.
… The authority’s legal team includes David Boies, of Boies Schiller & Flexner in New York, and Charles Cole of Fairbanks, the former Alaska attorney general.
In a news conference last night, Mr. Boies said the two companies had illegally conspired to refuse to deal with the authority, as part of a broad effort “to preserve the scarcity that has driven natural-gas prices to historic highs.”

Not for nothing is BP’s slogan “Beyond Petroleum.”

Boies, of course, was the antitrust lawyer who brought Microsoft to its knees.

Posted by Stephen at 1:12 AM in Energy + environment | Permalink | TrackBack (0)

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