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    Total Plans Appeal of Shale Gas Permit Revocation

Summary

Total SA is planning to appeal the decision by the French government to revoke permits granted for shale gas exploration.

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Total Plans Appeal of Shale Gas Permit Revocation

Total SA is planning to appeal the decision by the French government to revoke permits granted for shale gas exploration.

Le Figaro reports that the French major believes there was no legal basis for the action taken by the Government in early October, and that the move was undertaken for strictly political purposes in advance of the upcoming presidential elections.

CEO Christophe de Margerie confirmed the move Saturday at a forum held in Lyon by the newspaper Liberation: "We will appeal against the revocation of our license Montélimar" on the exploration of shale gas.

Three exploration permits, which had been granted to US company Schuepbach in Nant (Aveyron) and Villeneuve-de-Berg (Ardèche) and to Total in Montélimar (Drôme), were repealed on October 3, 2011.

Total's authorization was revoked despite it stressing it would not use the banned technique of hydraulic fracturing in unconventional hydrocarbon extraction.

The French major's position was reportedly supported by experts who judged the report presented by the company to be in accordance with the law.

Irrespective, Total's position was not accepted by the government.

The Minister of Environment, Nathalie Kosciusko-Morizet, declared that Schuepbach reports referred to the use of the hydraulic fracturing technique whereas Total’s report did not but was considered by the Minister as not being "credible"

"We respected the law and we do not understand why this permit was withdrawn on legal grounds," Total Chief Executive Officer Christophe de Margerie told French newspaper Les Echos.

As Total indicated it would not use the hydraulic fracturing technique and was envisaging alternative techniques, Matthieu Adam, a partner with the Paris office of Fasken Martineau DuMoulin LLP. commented that an appeal should not be ruled out be as the validity of the repeal could be challenged under administrative law if not justified by an appropriate reasoning of the Government in view of the Law.

“In this respect, one may wonder whether the Law allows the Government to ground the repeal of a permit on the lack of credibility of the report provided to it whereas the Law only refers as a ground for repeal to the indication of the "effective or potential" use of the hydraulic fracturing technique," wrote Mr. Adam.

Total has until Dec. 12 to choose its form of appeal: administrative appeal to the services of the State or a judicial appeal immediately to the administrative court.