Retained by Amplify Energy Corp. in $96.5M pipeline breach dispute
Retained by Amplify Energy Corp. in $96.5M pipeline breach dispute
Teaming up with client leadership and counsel, Stout provided consulting services to Amplify Energy Corp. in connection with insurance claims and disputes arising from a pipeline breach and the resulting oil spill off the coast of Southern California.
One of the key disputes involved Amplify’s claim for losses against several shipping entities for ship anchor strikes that damaged the company’s offshore pipeline and ultimately resulted in the release event. As a result of the incident, Amplify incurred substantial costs to clean up the beaches and third-party vessels impacted by the spill, compensate businesses for economic losses, and repair the pipeline. Amplify also suffered the loss of production income, reputational harm, and diminished prospects for the future development of its production assets.
Stout was retained by Amplify to quantify damages and assist with the negotiation of the company’s claims against the shipping entities. Stout also aided with the preparation, presentation, and defense of insurance claims for cleanup, Natural Resource Damage Assessment damages, property damage, loss of production income, and legal expenses. Stout worked closely with Amplify and counsel to model and support the profits and value of the asset’s future development that the company would have realized “but-for” the incident.
Stout was uniquely positioned to perform the analysis to determine Amplify’s damages over and above what had been reimbursed by its insurance policies, which was a crucial piece of the claims made against the ships. In addition, with their deep insurance expertise, Stout personnel assisted in negotiating subrogation claims made by Amplify’s property damage and loss of production insurers against the shipping entities.
After extensive negotiations, the shipping entities agreed to pay Amplify $96.5 million to settle the dispute. The overall resolution includes the subrogation claims made by Amplify’s insurers.