|
Governments, ExxonMobil clash in court Lawyers debate whether oil giant owes millions more to address lingering effects of Exxon Valdez spill; judge to mull the issue Wesley Loy For Petroleum News
Lawyers squared off in a federal courtroom on Nov. 15 to argue over ExxonMobil’s effort to defeat a government demand for $92 million.
The federal and state governments jointly requested the money to deal with lingering environmental damage from the 1989 Exxon Valdez oil spill in Alaska’s Prince William Sound.
At the hearing before U.S. District Judge H. Russel Holland of Anchorage, a lawyer for ExxonMobil argued the governments are improperly seeking the money to continue a cleanup of oiled beaches. Exxon was released from any further cleanup obligations many years ago, said attorney Carla Christofferson.
Roots of dispute The dispute stems from a 1991 civil settlement under which Exxon agreed to pay $900 million.
The settlement contained a “reopener” clause entitling the governments to request up to $100 million more to deal with unanticipated injury to habitat or species.
In 2006, the governments exercised the reopener, presenting Exxon with a demand for $92 million. It was based on what the governments contend was new information that relatively unweathered oil remained in the subsurface of beaches, and that the toxic oil was degrading at a far slower rate than was anticipated at the time of the 1991 settlement.
Exxon has yet to pay the demand, and the governments have yet to sue to collect it.
That situation irritated Rick Steiner, a retired University of Alaska professor and oil industry critic who in late 2010 began asking the judge to order Exxon to pay.
Exxon, in response, filed a motion to effectively kill the government demand, and that motion was the subject of the Nov. 15 hearing in Holland’s courtroom.
Cleanup vs. restoration The governments have said they won’t sue until certain studies are complete. One study focuses on the feasibility of bioremediation to rid the beaches of oil.
Exxon’s lawyers say the $92 million demand is improper because the governments are proposing merely to resume the cleanup of oiled beaches using the same sort of techniques employed after the spill — bioremediation, tilling and so forth.
Exxon’s main argument is that the reopener was for restoration, something distinct from cleanup.
Thus, the money demand is invalid, and the deadline for the governments to present a proper restoration plan has passed, Exxon argues.
Further, Christofferson told Holland: “At the time of this agreement, everybody knew there was still subsurface oil. There was no surprise.”
That argument seemed to intrigue Holland, who asked Christofferson if perhaps it was a “cleaner shot” at the governments’ position.
‘Truly maddening’ Lawyers for the federal and state governments told Holland that restoration and cleanup can overlap, and thus Exxon’s argument is flawed.
William Brighton, a U.S. Department of Justice environmental attorney, said the 1991 settlement placed no limitation on the types of technology that might be used for restoration.
And nothing in the settlement said restoration work could not include cleanup activities or remediation, said Seth Beausang, an Alaska assistant attorney general.
“The motion is taken under advisement,” Holland said at the end of the 50-minute hearing. He promised to render a ruling “soon.”
“The hearing was pretty much as expected, with Exxon arguing semantics, the government opposing, and nothing at all being done for the injured environment,” Steiner told Petroleum News by email after the hearing. “There is no bright line between oil spill response, cleanup, remediation, and restoration, and indeed, there is a great deal of overlap.”
Steiner added: “The government clearly wins this round, and Exxon loses, but this still leaves us stuck, as the governments are still not trying to collect their ‘demand’ of over five years ago. It is truly maddening.”
| 