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Friday, August 19, 2011
Marathon Oil Co. is under the legal gun as two plaintiffs have retained lawyers for what they say is the company’s failure to pay royalties. Houston attorney John Kim of the Kim Law Firm has been retained by Janis Frank Henry and Barbara Frank Sharman who allege that the company failed to pay royalties due them from the Alba field off the coast of Equatorial Guinea.
Henry and Sharman are the daughters of noted geologist/geophysicist G.W. Frank, who assisted in the development of the Alba oil and gas field. Henry and Sharman claim that Marathon has disregarded a binding agreement originally established by their father and Joe C. Walter, Jr., the oil and gas entrepreneur who originally developed the Alba field. In 1991, Walter entered into an agreement with Frank and other consultants to protect their interests in the project “in the event that Walter's interests in the Alba Prospect would ever be bought out by larger oil and gas corporations.”
In 1995, Walter's interests in Equatorial Guinea were sold to CMS Energy, which later sold them to Marathon in 2002. Frank died in 2000. According to the daughters' claim, which was filed on August 12 in Harris County District Court, the Alba field “has proven to be fabulously successful for Marathon.”
“By shortchanging Frank, Marathon and the other Defendants have gained, and will gain in the future, many millions of dollars in additional ill-begotten profits,” the lawsuit says.
Henry and Sharman are intervenors in Carr P. Dishroonv. Marathon Oil Company, No. 2008-40057, which includes similar claims against Marathon on behalf of another consultant to Walter. That lawsuit includes claims that Marathon underpays, or doesn't pay at all, on condensate collected at onshore plants; fails to pay royalties on the processed gas sold to third parties; doesn't pay a fair market gas price; and takes improper tax deductions.
“Companies like Marathon would be nothing without the hard work and expertise provided by men like G.W. Frank,” says Mr. Kim. “For them to try to back out of their legal agreements, as they are now, is shameful and needs to be corrected.”
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