The Supreme Court has upheld a Court of Appeal decision in favour of the second largest onshore oil producer Star Energy Weald Basin Limited (Star Energy) in a high profile dispute with Bocardo SA.

The landmark case considered the extent to which land owners own the earth beneath their properties with Star Energy advised by international legal practice Norton Rose LLP.

The case concerned an onshore oil field, partly located under the Surrey estate owned by Mohamed al Fayed’s company, Bocardo.

Star Energy had a licence to extract petroleum from the oil field and used deviated wells drilled from adjacent land to do this.

The deviated wells entered Bocardo’s land at several hundred feet below the surface which Bocardo claimed amounted to trespass.

The Supreme Court upheld the Court of Appeal’s decision that, although this did constitute trespass, damages of only £1,000, slightly more than nominal damages because of the statutory backdrop to the case, should be awarded.

This was a significant departure from the damages awarded at First Instance of over £620,000 for past trespass plus 9 percent of future revenue.

The Supreme Court’s decision will be welcomed by the UK onshore oil industry according to Norton Rose partner Neil Miller, who managed the team for Star Energy.

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