Archive for the ‘exxon’ tag
The Gulf’s uncertain future
First published by The Truth Pursuit- The Future of the Gulf
BP has promised to emerge from the disaster in the Gulf of Mexico “smaller and wiser”. And with the replacement of CEO Tony Hayward with self-professed ‘Son of the Gulf’ Bob Dudley, announced on Monday, a new mood has swept through BP, one focused on pushing to the future. Starting anew.
But the disaster in the Gulf is not over. BP’s recovery may be measured by its bottom line, but for the population of the Gulf the process of rebuilding is fraught with obstacles and there is no clear line to map its progress.
Nervousness hovers unnaturally within the vibrant communities of Louisiana. It has swept in with the tide of oil, along with confusion, distrust and misinformation, and has done little to help the image of the British oil giant who promised to “make whole” the communities and the environment of the Gulf. The same promise Exxon made 21 years ago to the communities of the Prince William Sound in Alaska.
Exxon employed an army of 23,500 to clean up the oil that washed up on the rocky shoreline of Alaska after the Exxon Valdez hit Blythe Reef in the early hours of Good Friday 1989 spilling its cargo into the pristine waters of the Prince William Sound. It was the biggest environmental disaster in US history, until the disaster still unfolding in the Gulf of Mexico eclipsed it after 37 days.
The story of the cleanup effort dominated the headlines during the summer of 1989. But when the press slouched away as the looming threat of Alaska’s harsh winter brought the cleanup to a close, Exxon’s legal might revved into action. The dance that Exxon choreographed through the courts lasted 19 years with the final punitive damages settlement only reached two years ago. Exxon fought the original damage settlement of $5 billion for 14 years until the amount was cut to $507 million. Exxon was also fined $150 million under the Clean Water Act, but only paid $25 million. Both amounts were reduced in recognition of Exxon’s cooperation in cleaning up the spill.
BP doesn’t have the “appetite” for litigation that Exxon has, said an industry insider, and frequently chooses to settle out of court. But cooperation, as well as the amount of oil actually spilt, are key factors in deciding BP’s liability when this disaster moves out of the cleanup phase.
The emotions from the summer of 1989 remain raw in Alaska and the protracted legal battles have kept the wounds open. In the years after the spill the small town of Cordova, with a population of less than 2,000, saw a massive rise in domestic violence, drug abuse and alcoholism. There were divorces that happened post spill and the promise of the compensation from the litigation was written into the divorce settlements, leaving them hanging over people for 20 years. There were also suicides.
“I think because we made the conscious decision not to be the victims of the spill, we were able to see other opportunities and we left,” said Sylvia Lange, a fisherwoman from Cordova, Alaska, who together with her husband and new baby, left Cordova half way through the summer of 1989 to fish out West. “Some people got real active. Some people got real rich. And some people just ruined their lives and just sat here and couldn’t let go.”
The spill of 1989 offered a short-term boom as spending on the cleanup jump-started the Alaskan economy out of recession. Locals still refer to “spillionaires” who were paid small fortunes to help clear up the mess, and stories circulate of people who traveled to Washington State to buy new boats to hire them out to Exxon. They made their money back in three months the story goes.
“That fall you saw brand new pick up trucks and Cadillacs on the roads, and new boats in the harbour,” said Joanne LeRue, a long time resident of Valdez.
Sylvia Lange recalls a conversation with a fisherman that summer. “I asked him, ‘Are you going to go work for Exxon?’ and he said, ‘Are you kidding me? I’ve been waiting my whole life for someone this rich to fuck up this badly’.” He got rich that summer. Spent it. Then he left.
Cracks appeared in the small communities of the Prince William Sound; divisions between those who wanted to help and those who wanted money. Between the outsiders and the residents. Between the fishermen and the oil industry. Between Exxon and the local government.
John Devens who was mayor of Valdez in 1989, remembers fighting to get into Exxon’s “information loop” that summer. “It was like someone coming into your home and spilling something nasty on your carpet. And then saying, ‘Get out of the house, I’ll clean it up and you better be satisfied with what I do’,” said Devens, “I think they felt they could muscle the communities into line and it probably cost them millions of dollars more by being that arrogant.”
As the cleanup response progressed, Devens’ frustrations grew as he found himself repeatedly coming into conflict with Exxon and Federal officials. Sitting next to Ted Stevens, Alaska’s long serving Republican Senator, at a press conference, Devens recalls Stevens turning to him. “John, you don’t understand, your priorities are different from ours. You’re worrying about the locals. We’re worrying about the reputation of the country,” he said.
But the disconnect between local concerns, government priorities and corporate motivation is a byproduct of a deeper disconnect inherent within today’s cleanup effort in the Gulf, as it was in Alaska in 1989: That an oil spill can be cleaned up. That the environment can be made right.
“They would have done more good flying over in a 747 and dumping the $2.2billion right over the top of the oil spill itself,” says Dune Lankard, an Eyak native and fisherman from Cordova, Alaska who in 1989 joined the cleanup effort, “They haven’t learnt a damn thing from the Exxon Valdez. They haven’t learnt that everything that we’ve gone through, everything that we’ve learnt, is that everything their doing doesn’t work. There’s no way that they can clean it up. There’s no way that they can make our lives whole again. They’ve no way.”
As Exxon endeavored to make right the Prince William Sound, they focused on rebuilding the size of the salmon population that sustained the local economy. And within 5 years the area had regained its position as the largest fish producer in US, and the fifth largest in the world. But the Alaskan waters are producing larger quantities of lesser quality hatchery salmon with fewer, bigger boats. The size and diversity of the wild salmon populations have never returned, neither have the herring. The natural cycle of the fishing season that defined the year for much of Alaska’s coastal population has never been restored.
John Devens Jnr, son of Mayor John Devens, worked for Exxon cleaning up the Sound’s oiled shoreline during the summer of 1989. “We knew the cleanup was going to be evaluated not on what was actually done but how many man hours and how much money they spent on it,” he said. And likewise, the long-term restoration effort in Alaska has been focused on quantifiable goals.
Today trailers, motor homes and boats adorned with ‘For Sale’ signs litter the parking lots throughout Valdez, the namesake town of the now-infamous tanker. ‘For Rent’ signs bleached of their color hang in the windows of long empty shops. The campaign banners line the streets in preparation for the midterm elections in November as if demanding a better future.
Everyone in Prince William Sound has a story to tell about the summer of 1989. “My father missed my birth,” says Jen Smith, 21. She was born a month after the Exxon Valdez hit Blythe Reef. “He was cleaning oil.”
In the Gulf the uncertainty of what’s to come hangs over the coastal communities.
Walter Gisclair, 52, stands on the dock with one rubber booted foot on a crate of crab. “I usually have 70 boxes by now,” he says gesturing at the 14 boxes that surround him, “But I hope I don’t get any more. I can’t sell them. Who wants to eat fish from where the oil’s at?” He says he doesn’t think the oysters will return in his lifetime.
Amanda Domangue, owner of a specialist oil trucking company called Justice Transport in Houma, Louisiana, is barely making ends meet since the moratorium cut business by 80 per cent. Oil industry workers fall into a grey area. They don’t qualify to file a claim under the $20 billion escrow fund or $100 million claims program specifically set up for rig workers. The only option left to Amanda is a lawsuit, but Kenneth Feinberg, the administrator of the escrow fund, admitted at a town hall meeting in Houma on July 15 that they were unlikely to win a case against the federal government.
“There’s no option. There’s really nothing,” said Amanda, “File a lawsuit that he [Feinberg] says there really no chance of winning. So that’s nothing. And we have no recourse. We have nothing.” 330,000 people fall into this grey area in Louisiana alone.
In August the permits that Amanda requires to operate her business, including a $20,000 down payment for insurance, come up for renewal. She has to make the decision now whether to make that investment, or write off the entire year.
“2010 was going to be all about change,” said Lorrie Grimaldi, of St Bernard, Louisiana, as she cracks open a crab with the practiced dexterity of a fisherman’s wife. Lorrie and her family moved into a new house in March of this year. They had lived in a FEMA trailer for five years since Hurricane Katrina destroyed their home. “I thought it was going to be the best year of my life, ever. And then, guess what. But the hardest part is not knowing what’s going to happen next.”
Lessons learnt from the Exxon Valdez
Reports suggest that BP may be close to stopping the flow of crude oil into the Gulf. With the flow abated one of the worst unknowns in this disaster, how long it’s going to go on for, will start to come into focus. This may serve as small consolation to the residents of the Gulf coasts many of whom felt unable to start picking up the pieces of their shattered way of life and economy until they knew what they had lost.
The battle between BP and the Macondo well has seen man pitted against the elements as scientists and engineers fought to overcome a force greater than their shared intellectual might. And if man has now vanquished the well congratulations and a huge feeling of relief will rightly follow.
But with the most dramatic thread of this disastrous story over, a few lessons need to be learnt from the Exxon Valdez spill in 1989 to make sure that from here on the focus is on rebuilding communities and restoring the environment, and not on the legal strength of BP.
The Exxon Valdez oil spill was different from the events surrounding the Deepwater Horizon catastrophe on many fronts. The amount of oil spilling into Alaska’a Prince William Sound was from a finite source, and estimates quickly settled 11 million gallons as the total. In the first days after the spill, the cause seemed clear: a drunk Captain had absconded his duties and left an under qualified third mate in charge of an off course tanker that was traveling too fast. This lead to Captain Hazelwood becoming the most vilified man in the US and international media.
But after the first few weeks, when the cleanup effort had started, the flow of dramatic photos of oiled otters had ebbed and comparisons between Alaska’s bright blue-white glaciers and the dark invasion of crude oil in the Sound had been exhausted, the media started to slouch away. And with their focus gone, public pressure was diverted elsewhere and the most devastating damage to the communities of Prince William Sound and the people who came to help restore it was done.
The federal government was notable only in their silence over the Exxon Valdez disaster. And as the outside media turned away (local papers remained and were central in exposing the full implications of the disaster), the federal government was able to continue its line of disinterest.
The feds only reared their heads when it came time to divide up responsibility for overseeing a fund set up by Exxon to restore the natural environment at the instigation of a State of Alaska led court battle against the oil company. The federal government then demanded that a large proportion of the final settlement reached in 1991 to be administered by the Environmental Protection Agency (EPA) for further environmental studies.
The State of Alaska victory against Exxon, was followed by a 19 year legal battle between Exxon, the State and the victims of the oil spill. The final settlement reached in 2008, after repeated appeals by Exxon, demanded $25 million from the oil giant that recorded $45.2 billion profits that year.
This drawn-out complex legal dance that Exxon choreographed was allowed by a lack of governmental strength, which was in turn permitted by a rapid decline in public pressure.
Fast forward 21 years and the Obama administration secured a $20 billion escrow fund from BP on June 16, 58 days after the blow out preventer failed on the Macondo well, putting them $20 billion ahead of their counterparts in 1989.
Obama has received no end of criticism for his handling of the disaster in the Gulf, but, as I’ve said in pervious posts, the current administration is in a very difficult position. Although concrete action is what the public might want to see, there is little Obama can deliver beyond rhetoric. The Escrow fund was a clear victory for the government and the victims of the disaster, but this was quickly overshadowed by niggling questions: Is it enough? Who will administer the fund? Will it be done fairly?
The Obama adminstration sought to answer all of these questions and concerns (which are absolutely valid). He put Kenneth Feinberg in charge, who handled post 9/11 compensation, and made it clear that the $20 billion amount, to be paid in $5 billion installments over the next four years, does not represent a final settlement. Obama also managed to demand the oil giant maintain the $20 billion in US assets to make sure that the money was readily available.
The root of the discounted over Obama’s handling of the Escrow fund episode may be the apparent ease with which he procured a deal from BP: it lacked the ‘ass kicking’ the president had repeatedly promised the public.
But ass kicking, despite it ability to sell papers and it appeal to public consciousness (I don’t think I’m alone in wanting to know exactly how Obama would kick someone’s ass- a slice to the side, a boot from the back or a high kick?), is not the most productive approach when trying to bring about a solution. The federal government, largely through the Coast Guard, has to forge a constructive relationship with BP.
The importance of pursuing a unified approach to the Gulf situation has frequently made it appear that the Coast Guard and the Federal government are limply following BP’s lead, as the same rhetoric appears in all of their statements. But rather than taking the cynical approach, how about viewing that as a positive: they’re talking to each other!
This was lacking in the response to the Exxon Valdez. Although the Coast Guard and Exxon repeatedly appeared as if they were cut from the same cloth, the coast guard was lacking the support of the federal government to actually put itself in a controlling position.
The web of failure that lead up to the Exxon Valdez is disturbingly similar to the failings that created the current disaster in the Gulf: a slow economy and lax regulation proceeded by eight years of a Republican government. But today’s government recognized the public relations nightmare that BP is trapped in and understood that now while public pressure is palpable is the best, if not the only, moment that they can demand that BP step up to the plate financially.
A change in the status quo that the oil industry enjoys can only come through tougher regulations, and the introduction of citizen oversight councils. The latter is happening, and the most successful oversight group in Alaska, Prince William Sound Regional Citizen’s Advisory Council (PWS-RCAC), which monitors the tanker terminal in Valdez, is in close talks with the Gulf states to set up similar groups. This is with the strong support of the White House.
If public pressure continues, and the Republicans don’t sweep the table at the Midterms, then a true and lasting change to the way the oil industry is allowed to operate in this country may be on the table.
Scientists today are hoping that the Macondo well is still under high enough pressure for them to put the containment cap in place. High pressure means the structure of the well is still sound, while low pressure would indicate that oil is leaking through many smaller gaps. High pressure is essential to see progress on all aspects of the Gulf disaster. It is only as pressure drops and time elapses from a disaster that monitoring slackens and corners are cut.
