Archive for the ‘Oil Spills’ Category

No Good Deed Goes Unpunished

Via WikiMedia Commons

Via WikiMedia Commons

Rumor has it that North America may be energy independent within a few years.

Alternative energy sources like wind, solar, and biomass are contributing ever greater amounts to the nation’s energy bank. And the country’s traditional oil and gas industry is booming as it hasn’t in decades. Where the U.S. had become an energy mendicant, relying on unstable (and occasionally unsavory) sources overseas, the country is set to be a net energy exporter and will soon overtake Saudi Arabia as the globe’s top oil producer. Energy independence is a good thing. Weaning ourselves from middle Eastern oil reserves will bring market stability and reduce the temptation to secure our oil and gas supplies by force of arms.

But supplying the bulk of our own energy needs domestically presents challenges of its own.  Wind and solar electricity has to make its way from place where it is generated to consumers who might be thousands of miles away. The national grid is being upgraded but is not yet up to that task. Moving all the new oil and gas that’s flowing out of the various bonanzas around the country presents a whole separate category of problems. Quite aside from the environmental toll presented by hell-for-leather production in, say North Dakota or Alberta, just moving the stuff around the country safely and efficiently is a herculean task.

We generally think of oil and gas as flowing through pipelines. The Keystone Pipeline, which would bring tar sand oil from Alberta is a political flash point. Lots of people are questioning its safety, and for good reason. Exxon’s burst pipeline in Arkansas  and PG&E’s fiery pipeline failure in San Bruno are still fresh in the public mind.

But pipelines are not the only way oil gets around the country. Increasingly, it’s making its way to market by rail. And that’s proving to be a bit of a train wreck in its own right. Last month, the town of Casselton, ND had to be evacuated after a mile-long train carrying crude oil slammed into another train, resulting in thunderous explosions and a searing plume of toxic smoke. ABC tells us that this was the third accident in six months involving trains carrying North Dakota crude oil. In July, a train of 72 carloads of crude oil in Quebec derailed and burst into flames, killing  almost 50 people.

Coal, too, is being increasingly transported by train in the face of growing opposition.

It’s naive to think we don’t need the energy we’re pulling out of the ground with such new-found vigor. It’s also naive to think we could stop it being distributed around the country. But we shouldn’t think that energy independence is an unalloyed good. It presents a whole slew of problems of its own.

The Mayflower Impact

A town in Arkansas may have become a black mark against the Keystone pipeline project. The recent ExxonMobil Pegasus pipeline rupture and oil spill in Mayflower, Arkansas involved several thousand barrels of oil spilling into a residential neighborhood and potentially into the local water supply via a storm drain. Keystone opponents are pointing to this incident as a small-scale example of what can be expected if the project moves forward. Keystone allies, meanwhile, point out that the Pegasus pipeline is sixty-five years old and does not contain many standard safeguards  in more modern pipeline designs that would be included in the Keystone construction.

Back in Black

oiled bird

Photo by Ingrid Taylar. Some rights reserved.

You may recall that last week the possibility of Hurricane Isaac stirring up oil from the BP Deepwater Horizon disaster was being debated. Unfortunately, it looks like the debate is over and the pessimists have won. The Associated Press reports that oil and tar balls have been reported in Louisiana, Missisippi, and Alabama as the storm surges and floodwaters from Isaac have receded. In Louisiana, 13 miles of beach were closed due to the presence of oil and fishing was restricted around the closed area. Samples of oil from both Louisiana and Alabama are being tested to determine whether they are a match to the oil from the BP spill. The Huffington Post noted that areas of Florida and Texas are also reporting the presence of oil. While the origins of all the reported oil have yet to be determined, things are not looking good for BP. Incidentally, the company moved last week to donate $1 million to the areas of Louisiana and Missisippi that were damaged by Hurricane Isaac. But if the new oil is found to have originated with the Deepwater Horizon, BP may have to pull out its wallet yet again.

Catching up on the Yellowstone Spill

Photo by Forest Service. Some rights reserved.

Because of the long weekend, we haven’t yet had a chance to offer up our own take on the Yellowstone spill story. For those of you who also took a three day weekend off from energy and environmental news, allow us to offer a primer:

Late on Friday, July 1st, an oil pipeline ruptured along the Yellowstone River outside of Billings, Montana, spilling 1,000 barrels (or 42,000 gallons) of oil into the river and along the banks. The 20-year old Silvertip pipeline is owned by ExxonMobil and transports 40,000 barrels of oil a day.

So far, response to the spill has been widespread, even with the distraction of a holiday weekend. 150 volunteers were on the scene by Sunday helping with clean-up, who were aided on Tuesday with crews from Exxon’s Regional Response Team and other emergency response organizations. Montana Senator Max Baucus sent a letter to Exxon CEO REx Tillerson, asking for specifics on the accident and for a record of past safety inspections of the pipeline, and also insisted that Exxon set up a claims process to ensure that all property owners affected by the spill be reimbursed. Senator Jon Tester, meanwhile, said in a public release that he would hold ExxonMobil financially responsible for the clean up and recovery process.

Meanwhile, the PHMSA (Pipelines and Hazardous Materials Safety Administration) has initiated its own investigation into the spill, and the EPA is also looking into the spill, conducting water and air quality tests in the surrounding area. Obviously this is all-around unfortunate news, and could be seen as something of a warning sign for increased pipeline safety and accountability as plans for new national pipelines appear on the books. If it makes any of us feel any better (I’m sure it doesn’t), the Wall Street Journal reported today that while most energy stocks rose over the weekend, ExxonMobil stocks are flat at $82 a share. Hopefully on a larger level spills like these will have a net-positive effect in holding corporations more accountable for their safety procedures, and maybe even in reversing our positions on building new pipelines. Hopefully.

BP Oil Spill Continues to Impact Gulf Residents

Photo by Mark O'Neil. Some rights reserved.

Though much of the world seems to have moved on from the 2010 Deepwater Horizon oil spill, the struggle continues along the Gulf of Mexico. Last week, the Gulf Coast Claims Facility (GCCF) announced its final rules governing payment options and final payment methodology after receiving more than 1,440 comments from individuals and businesses. These comments range from pleas to move forward quickly to a 24-page comment from BP PLC itself, saying that Kenneth Feinberg’s allocation of the $20 billion damages fund has been overly generous.

In a recent press release, the Gulf Coast Restoration and Protection Foundation announced that qualified workers will have a second opportunity to apply for financial assistance this spring, stating that “up to 9,000 people might qualify for awards ranging from $3,000-30,000.”

There is another mammalian population that seems to be suffering from the fallout of the spill that cannot even apply for restitution. The Institute for Marine Mammal Studies (IMMS) announced this week that dead baby dolphins have been washing ashore at ten times the normal rate. Some 26 dolphins, many aborted before they reached maturity, have been found along the Mississippi and Alabama coastlines in recent weeks.

Though experts have not officially linked the spike in death rates to the oil spill, this is the first birthing season for dolphins since the oil spill last year. As institute director Moby Solangi told reporters, “this is more than just a coincidence.”

Mortality rates in the Gulf Coast dolphin population tripled last year; with a gestation period of 11 to 12 months, the baby dolphins now being found were conceived at least two months before the Deepwater Horizon exploded.

Meanwhile, in light of the continued unrest in Libya (the world’s 17th-largest oil producer) and the surrounding area, key House Republicans are urging the Obama Administration to move forward with the issuing of offshore oil-and-gas drilling permits. BP has announced this week that it will pay $7.2 billion for a stake in India’s rapidly expanding oil industry; the historic partnership with Reliance Industries Limited is slated to combine Reliance’s project management expertise “with BP’s world-class deepwater  exploration and development capabilities.”

Chevron Company Found Guilty in Historic Environmental Lawsuit

Photo by Peter π. Some rights reserved.

On Tuesday, Chevron Corporation was ordered by Ecuadorian courts to pay $9 billion in damages for massive environmental contamination of the Amazon rainforest. The lawsuit was filed in 2003 by Ecuadorian citizens, many of whom are representatives of multiple indigenous groups from northeastern Ecuador. The litigation was originally brought against Texaco Petroleum Company in a Manhattan court some 18 years ago, and was inherited by Chevron when it acquired Texaco in 2001.

Critics like Amazon Watch and Rainforest Action Network say that Texaco “dumped 18.5 billion gallons of toxic wastewater into streams and rivers, spilled some 17 million gallons of crude oil, and left behind more than 1000 waste pits that continue to leech toxins into surrounding soil and water. The pollution has caused a spike in cancer rates and decimated the cultures of various indigenous groups in the area.”

But Chevron denies these allegations. In the company’s most recent quarterly report, it states that Texaco Petroleum subsidiary Texpet carried out a $40 million remediation program, after which the Ecuadorian government granted “a full release from any and all environmental liability arising from the consortium operations.”  Disclosure of this litigation is qualified with the claim that “Chevron believes that this lawsuit lacks legal or factual merit.”

In a recent press release, Chevron states that much of the evidence provided in this suit “shows an elaborate criminal scheme involving fraud, extortion, collusion, forgery and witness tampering,” and is already taking steps to prevent enforcement of the ruling: the company was granted a temporary restraining order against the plaintiffs, barring them from taking enforcement action. Chevron has also filed a racketeering suit against the plaintiffs’ legal team.

In the history of environmental damage cases, this judgment is second only to the $20 billion BP Gulf spill settlement; it is also the first time a foreign court has held an American corporation accountable for its environmental impact abroad. Chevron will appeal the decision; the Ecuadorian judge who issued the verdict says that Chevron has 15 days to issue a public apology after which the fine will be doubled.


And In Other Oil Spill Claims News…

The Hill’s E2-Wire blog reported yesterday on updated payment options available to Deepwater Horizon claimants.

Photo by Fibonacci Blue. Some rights reserved.

The Gulf Coast Claims Facility (GCCF) is a facility that manages claims for costs and damages incurred as a result of the Deepwater Horizon oil spill. BP contributes funds to an account that are then distributed by an independent claims administrator.

Emergency payments, which were advance payments to individuals or businesses having financial hardship resulting from the spill, ended November 23, 2010. However, the GCCF just recently indicated that they will soon begin accepting claims for Interim and Final payments. There are three payment options available at this time, which are summarized here.

And what are the payment options?

    This claim option provides an automatic payment of $5,000 for Individuals or $25,000 for Businesses, with no further review or requirement for additional supporting documentation. However, this option requires claimants to sign a release of liability that prevents them from seeking further compensation from GCCF or in court.
    A Full Review Final Payment Claim will be paid in a lump sum single payment for all documented losses and damages, both past and future. A Full Review Final Payment Claim requires complete substantiation and documentation of all damages sustained in the past. This option also requires claimants to sign a release of liability that prevents them from seeking further compensation from GCCF or in court.
    An Interim Payment Claim may be submitted for past losses and damages incurred as a result of the Spill – and ONLY past damages. For future losses or damages to be evaluated and paid, one must submit a Full Review Final Payment Claim. However, those submitting an Interim claim will not be required to sign a release of liability.

According to E2-Wire, the claims administrator “has encouraged oil spill victims to seek compensation through the GCCF, warning that legal battles could last for years.” As we discussed yesterday, in the case of Exxon Valdez, “years” is no exaggeration. Even BP admits in a 6-K filed last month that “claims and litigation settlements are likely to be paid out over many years to come.”

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