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Thomas Eastment Litigating oil and gas cases against the federal government, says Baker Botts partner Thomas Eastment, is “like a slow-motion chess game.” If so, Eastment, 55, has proved himself a master player, representing such clients as the Shell Oil Co., Exxon Mobil Corp., ChevronTexaco Corp., and BP Plc in complex disputes with the Federal Energy Regulatory Commission and the Department of the Interior. “He is a first-class trial lawyer,” says Shell senior counsel Charles McClees. “His skills are superb. He’s an excellent advocate, and a master of presenting both legal arguments and facts in verbal and written form.” Eastment is currently making the case for Shell and other major producers in a long-running dispute over interstate gas pipeline rates. The case, Exxon Mobil Corp. v. FERC, which began in 1992, is being briefed for the third time before the U.S. Court of Appeals for the D.C. Circuit. If the Transcontinental Gas Pipe Line Corp.’s proposed “firm-to-the-wellhead” rate is approved, Eastment says, gas producers stand to save about $50 million a year. Eastment graduated from the University of Michigan Law School in 1975 and holds an undergraduate degree in chemical engineering. Originally wanting to become an intellectual property lawyer, he joined the now-defunct D.C. IP boutique Morton, Bernard, Brown, Roberts & Sutherland, only to discover that he was more interested in litigation than patent prosecution. In 1977, Eastment moved to the D.C. office of Houston-based Baker Botts. His technical background made him a good fit with the firm’s energy practice group, and he made partner in 1985. Notable D.C. colleagues include Bruce Kiely, whose work in the area of liquefied natural gas (LNG) dates back to the early days of the industry, and Randolph McManus, another LNG pioneer who is also known for his electricity expertise. Both Steven Miles and Mark Lewis offer substantial international experience. In recent years, Eastment has represented the American Petroleum Institute, the oil and gas industry’s trade association, in litigation against the Department of the Interior’s Minerals Management Service. At issue: the amount of royalties that producers must pay the government for extracting oil and gas from federal and Indian lands. Producers objected that the government’s royalty valuation was unfair because it didn’t allow deductions for downstream marketing costs or certain upfront transportation costs. In 2000, the U.S. district judge agreed and struck down the regulations disallowing those deductions. On appeal, the D.C. Circuit reversed on allowing marketing-cost deductions but affirmed the deductions for transportation costs. Last year, Eastment chalked up two satisfying wins of note. In Burlington Resources Oil & Gas Co. v. FERC, the D.C. Circuit ruled that Eastment’s client, an oil and gas exploration and production company, did not have to issue a refund to pipeline owners regarding an ad valorem tax on natural gas because the parties had already entered into a settlement that included an indemnification clause covering such claims. “There were not huge financial stakes, but it was a very important principle,” says Eastment. “We had a settlement.” In BP West v. FERC, Eastment represented seven oil and gas shippers, including BP, Exxon Mobil, and the ConocoPhillips Co. The case dealt with an issue of first impression for FERC in its regulation of oil pipelines: Are master limited partnerships entitled to an income tax allowance? Eastment argued that limited partnerships themselves don’t incur income taxes � even if their owners do. That means FERC shouldn’t allow such entities to charge higher rates to offset income tax expenses. After more than a decade of litigation, the D.C. Circuit last July endorsed Eastment’s position, reversing FERC’s policy. “I can’t say enough good about Tom,” proclaims John Glancy, general counsel of the Holly Corp., the parent company of Navajo Refining Co., another shipper in the case. “He’s an expert in the area of FERC matters. He’s a lawyer I trust completely. I know when he has a matter, it will be handled well.”

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