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Feb. 3 (Bloomberg) - - The Obama Administration acted in contempt by continuing its deepwater drilling moratorium after the policy was struck down, a New Orleans judge ruled.

Interior Department regulators acted with “determined disregard” by lifting and reinstituting a series of policy changes that restricted offshore drilling, following the worst offshore oil spill in U.S. history, U.S. District Judge, Martin Feldman of New Orleans ruled yesterday.

“Each step the government took following the court’simposition of a preliminary injunction showcases its defiance,”Feldman said in the ruling.

“Such dismissive conduct, viewed in tandem with the re-imposition of a second blanket and substantively identical moratorium, and in light of the national importance of this case, provide this court with clear and convincing evidence ofthe government’s contempt,” Feldman said.

President Barack Obama’s administration first halted offshore exploration in waters deeper than 500 feet in May, after the explosion and sinking of the Deepwater Horizon drilling rig off the Louisiana coast sparked a subsea blowout that spewed more than 4.1 million barrels of oil into the Gulfof Mexico.

Overly Broad

Feldman overturned the initial ban as overly broad in June,after the offshore-drilling industry and Gulf Coast politicaland business leaders challenged it. Almost immediately, U.S.Interior Secretary Kenneth Salazar announced he’d find another way to block offshore exploration until the industry beefed updrilling safety and oil-spill response capabilities in reaction to the Gulf oil spill.

Salazar instituted a second drilling ban in July, which was also challenged by an industry lawsuit that claimed the ban wa sdevastating the Gulf Coast economy, which is heavily dependant on deepwater drilling activities. That ban was rescinded in October, before Feldman could rule on its validity.

Feldman later ruled that enhanced drilling safety rules Salazar imposed to permit companies to resume offshore exploration violated federal law, and he struck those down as well. The offshore industry and Gulf Coast interests complained to Feldman that regulators were continuing to block theresumption of drilling activity despite his rulings.

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