Cutting Underwater Technologies USA, Inc. v. Eni U.S. Operating Co.
671 F.3d 512
5th Cir.2012Background
- Vermilion Block 313-A platform toppled by Hurricane Rita; wells connected to platform were plugged and conductors cut in 1999.
- Con-Dive, the prime contractor, subcontracted labor to TBS, Cutting Underwater, and Cheramie Marine for platform removal.
- Cutting Underwater and others filed liens against Eni’s property in Vermilion Parish in 2008; Cutting Underwater amended to include Eni in Jan 2009.
- Eni removed the case to federal court under OCSLA; the dispute concerns the validity and enforcement of TBS’s LOWLA lien.
- District court granted TBS summary judgment declaring the lien valid; Eni’s summary-judgment motion to invalidate the lien was denied.
- The central issue is whether the work performed by TBS qualifies as a LOWLA “operation” involving “abandoning a well” and performed “on a well site.”
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the TBS lien is valid under LOWLA. | Eni contends TBS did not perform an “operation” of abandoning a well. | TBS contends removal of the platform was part of abandoning the depleted wells and on a well site. | Yes; TBS’s work falls within LOWLA’s definition of an operation. |
| Whether the work was done for the purpose of abandoning a well. | Eni argues abandoning a well ended with plugging and cutting, not platform removal. | TBS argues platform removal is integrated decommissioning following depletion. | Yes; removal after depletion is part of abandoning a well under LOWLA. |
| Whether the work was performed on a well site. | Eni argues the site was not a well site once wells were plugged. | TBS conducted surveys, positioning, and post-salvage work offshore at Vermilion Block 313. | Yes; activities offshore near the platform constitute work on a well site. |
Key Cases Cited
- Guichard Drilling Co. v. Alpine Energy Servs., Inc., 657 So.2d 1307 (La. 1995) (LOWLA policy supports enforceability to protect subcontractors)
- Mariner Energy, Inc. v. Devon Energy Prod. Co., 690 F.Supp.2d 558 (S.D. Tex. 2010) (decommissioning and LOWLA scope in offshore context)
- Samedan Oil Corp. v. Ultra Fabricators, Inc., 737 So.2d 846 (3d Cir. 1999) (older interpretation of well-site concept; distinguishable facts here)
- Wilson Indus., Inc. v. Aviva Am. Inc., 185 F.3d 492 (5th Cir. 1999) (LOWLA as surrogate federal law; applicability affirmed)
- Gardes Directional Drilling v. U.S. Turnkey Exploration Co., 98 F.3d 860 (5th Cir. 1996) (constructs of LOWLA interpretation in federal offshore framework)