Star Energy Should Pay Al Fayed GBP1,000 - UK Supreme Court

30th Jul 2010 13:47

LONDON (Dow Jones)--The U.K. Supreme Court this week ruled U.K. onshore oil and gas company Star Energy Group Ltd. should pay GBP1,000 compensation to Mohammed al Fayed, the former proprietor of Harrod's department store in London, for operating oil wells that ran beneath al Fayed's English country estate. In a judgment July 28, the Supreme Court upheld an appeal by Star Energy against an earlier ruling that it must pay a portion of revenue from the oil wells to Bocardo SA, a company controlled by al Fayed that owns the estate in Surrey, England, as compensation for trespass. The wells, which were originally drilled by ConocoPhillips (COP) and Cairn Energy PLC (CNE.LN) and acquired by Star Energy in 1999, tapped oil from a reservoir in the Weald basin and passed under al Fayed's land at depths of between 800 feet and 2,800 feet. A High Court judge ruled Bocardo was entitled to compensation equivalent to 9% of all past and future revenue from the wells. The past revenue alone would have been worth GBP620,000, according to a statement from Star Energy Friday. The Court of Appeal cut this to GBP1,000, citing laws surrounding compulsory purchase rules. The Supreme Court agreed with the appeal court's verdict, although Lord Brown, a Supreme Court judge, added the GBP1,000 compensation was itself "positively generous." -By Jason Douglas, Dow Jones Newswires; 44-20-7842-9272; [email protected] (END) Dow Jones Newswires July 30, 2010 08:47 ET (12:47 GMT)