- - Thursday, August 18, 2011


Report: Exxon fights U.S. over major oil discovery

NEW YORK | Exxon Mobil Corp. and the federal government are fighting over one of the largest oil discoveries in the Gulf of Mexico that could yield billions of dollars of crude in coming years, according to a report in the Wall Street Journal.

The Julia oil field, about 250 miles southwest of New Orleans, may hold billions of barrels of oil and gas equivalent. Exxon, which announced the discovery in 2008, wants to tap that field. But the Interior Department says Exxon’s leases have expired and the company hasn’t met requirements for an extension.

Exxon and part owner Statoil have filed separate lawsuits in a Louisiana federal court to preserve the leases.

Exxon spokesman Patrick McGinn told the Journal that the government traditionally grants extensions as a matter of course. “You state your case and you got it.” The government’s refusal “was unexpected.”

Tens of billions of dollars are at stake. The oil could revert back to the federal government if Exxon and Statoil don’t win in court. And if the Interior Department takes back those leases, it would delay the development of those fields and the tax royalties that come with them.

At current prices, potential royalties paid to the government over the lifetime of a one-billion-barrel field would be about $10.95 billion, the Journal said.


Reports: Hewlett-Packard to spin off PC business

SAN FRANCISCO | Hewlett-Packard plans to spin off its personal computer division into a separate business, according to news reports.

The decision, according to unnamed sources cited in reports by the Wall Street Journal and Bloomberg, would isolate a division that is HP’s biggest generator of revenue but is its least profitable.

It marks a reversal from HP’s previous stance, in March, when the company called reports that it might sell its PC business “irresponsible reporting”.

The PC industry is under pressure from hot-selling smartphones and tablet computers, which have contributed to already weak consumer demand for PCs in the U.S. and Europe. HP may announce the move as early as Thursday afternoon, when it reports quarterly financial results.

An HP spokesman did not return a call from the Associated Press.

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