SOUTHEAST BOND-WATCH ALABAMA

The Bond Buyer

Officials saw the possibility of depositing a record-setting award into Alabama's coffers on Tuesday, after a jury handed down a $3.5 billion judgement in the state's case against Exxon Mobil Corp. But the verdict finding that Exxon defrauded the state on royalty payments will be appealed, oil company attorneys said.

The award is six times greater than any previous one in Alabama. Gov. Don Siegelman said the case proved that the company intentionally tried to cheat the state.

"I would suspect they won't make the mistake of trying to take advantage of this state again," Siegelman said in a prepared statement.

The governor said he wants to create a new fund to hold the jury's award so that it can be used for education and other critical needs such as jails.

Four other lawsuits filed by the state involving similar charges are pending

The Exxon case took about two weeks to consider, while the jury deliberated for about two hours before rendering a decision. The state's case involved underpayments from 3 natural gas wells near Mobile.
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