By An Oil Giant
By Andrew Gumbel
25 March 2004
after the Exxon Valdez oil spill in 1989, a senior Exxon representative
visited the devastated fishing communities of southern Alaska and promised
them the company would do everything in its power to restore their livelihoods
and "make them whole".
we do it right," is the slogan that has stuck in the mind of Dune
Lankard, a local Native American activist.
But 15 years to
the day since a drunken sea captain drove his oil tanker on to a reef
in Prince William Sound, covering one of the world's most pristine stretches
of coastline with at least 11 million gallons of crude, the feeling
among fishermen, environmentalist activists and the lawyers representing
them is that Exxon has not only broken its original promise but has
gone out of its way to betray them in pursuit of broader corporate interests.
Exxon, whose net
income for 2003 is expected to top $21bn, has not paid out a penny of
the $5bn (£2.7bn) in damages originally awarded to the fishing
communities a decade ago, launching appeal after appeal and deluging
the courts with paperwork. Despite intensive clean-up efforts, Prince
William Sound remains polluted by large oil deposits that have destroyed
its herring fisheries and wreaked havoc with the once-flourishing wildlife.
The town of Cordova,
whose fishermen could once count on earning $100,000 a season, has become
an outpost of despair, where debt and destitution have given rise to
alcoholism, drug abuse, broken marriages and numerous suicides. About
1,000 of the original 32,000 plaintiffs in the class-action suit against
Exxon have died, many of them succumbing to respiratory illnesses, brain
tumours and cancers that a growing body of scientific evidence has linked
to the spill and the subsequent clean-up.
Of the survivors,
many hang on, ever more despondently, for the Exxon settlement money
to arrive. Others have been forced to sell up and move away, returning
in the summer months to fish what they can from the Snake river as the
debt on their boats and their once highly valuable fishing permits continues
dodged its responsibility every step of the way," Mr Lankard said.
"The company had every opportunity to go beyond the call of duty.
Instead, they've understood that their hand gets stronger the longer
they wait. And in the meantime, people are dying."
Yesterday, a large
delegation of Cordovans and their supporters were in Washington to lobby
the Bush administration to reopen the federal government's own suit
against Exxon and force the company to pay out an extra $100m in environmental
damages. That extra money was written into the original 1991 settlement
for environmental damages - worth $900m - in the event that oil damage
proved more extensive than foreseen.
The fear of environmental
activists, however, is that both the Bush administration and Alaska's
leading elected officials would prefer to defer to the oil industry
and let Exxon off the hook. Alaska's attorney general, Craig Tillery,
has said it may be "premature" to present a case for the extra
$100m, which must be claimed by 2006.
Among those in Washington
was Kory Blake, a third-generation Cordovan known before the spill as
a "highliner" because he was one of the most productive commercial
fishermen pulling herring and salmon out of the Sound. He had about
$500,000 invested in his boat and in three commercial licences when
the disaster struck.
At first, he was
kept busy with the clean-up, on which Exxon spent an initial $2bn. Exxon
also voluntarily paid an initial $300m in compensation to 11,000 individuals.
But then in the early 1990s, just when everyone expected to start fishing
again, it became clear that the herring stocks had not returned and
the price of salmon - also slow to recover - started to go through the
floor as canneries turned to other sources in Chile and Norway. Mr Blake
had to sell his home to meet the annual $50,000 payments on his boat,
and moved his family to a suburb of Anchorage, where his wife got a
job as a school administrator.
- or what one expert, Steve Picou, professor of sociology at the University
of South Alabama, calls "adversarial legalism" - goes back
to the earliest days of the legal battles in 1990, when a company lawyer
argued that the crude oil was not a pollutant under the Clean Water
Act since it was a valuable commodity, not a waste product. In the class-action
suit, Exxon threw up so many obstacles after the initial $5bn judgment
that the case generated more than 7,700 docket entries. In a letter
written to the company in 1999 by the National Association of Attorneys
General, the company was accused of actually profiting from the delay
in payment because of the difference between the interest rate being
charged by the courts and the much higher rate it enjoyed through its
own internal financing systems. "Each year Exxon delays payment
of its obligation," the letter said, "it earns an estimated
In 2001, the Ninth
Circuit Court of Appeals overturned the damages award, prompting Cordova's
mayor to kill himself. The award was largely reinstated a year later,
but remains tied up in the appeals process for the foreseeable future.
say the government missed several opportunities to pressure the company
into settling, especially in 1999 when the Federal Trade Commission
was considering Exxon's proposed merger with Mobil. The merger was approved
without reference to the Exxon Valdez.
is that it has already done its duty. It strongly disputes suggestions
that the spill involved significantly more than the acknowledged 11
million gallons, and has rebutted scientific evidence of continuing
damage to marine and bird life with its own scientific studies demonstrating
the opposite. "The environment in Prince William Sound is healthy,
robust and thriving," a recent company statement said. "That's
evident to anyone who's been there, and it is also the conclusion of
many scientists who have done extensive studies of the Prince William
Not only do the
environmentalists strongly disagree, they see the events of the past
15 years as an ominous sign of how corporations will feel entitled to
behave in future.
"They are making
all these promises about treading with a light footprint and respecting
the environment if they open up the Arctic National Wildlife Refuge
to oil and gas exploration, yet they refuse to settle up on a mess they've
already made," Dune Lankard said.
25 March 2004 13:23
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