BP agrees to $7.8 Billion Deal for the 2010 Deepwater Horizon Oil Rig Spill

Posted by PITHOCRATES - March 4th, 2012

Week in Review

It was the end of the world.  The apocalypse.  Brought on by Big Oil.  And our addiction to that silky rich and seductive crude oil.  A new Black Death.  Only blacker.  And stickier. 

We had finally done it to ourselves.  We ruined our pristine Gulf coast.  And the fragile ecosystem in the water.  And on the land.  But there is one small consolation.  BP is paying billions in a settlement.  Lucky for us that they were so profitable to be able to pay for both the regulatory and compliance costs of their industry.  And these big lawsuits.  So we win.  Until we pump gas, that is.  Where they will no doubt pass on the cost of this very large settlement (see ‘Deal reached’ over BP Deepwater Horizon oil spill posted 3/3/2012 on the BBC News US and Canada).

BP says it has reached a $7.8bn (£4.9bn) deal with the largest group of plaintiffs suing the company over the 2010 Deepwater Horizon oil rig spill.

It will benefit some 100,000 fishermen, local residents and clean-up workers whose livelihoods or health suffered…

The rig exploded in the Gulf of Mexico in April 2010, killing 11 workers and leaking four million barrels of oil.

BP says it expects the money to come from a $20bn (£12.6bn) compensation fund it had previously set aside.

“From the beginning, BP stepped up to meet our obligations to the communities in the Gulf Coast region, and we’ve worked hard to deliver on that commitment for nearly two years,” BP Chief Executive Bob Dudley said…

BP has so far paid out $7.5bn in clean-up costs and compensation.

US President Barack Obama called the spill “the worst environmental disaster the nation has ever faced”.

But was it the worst environmental disaster we ever faced?  If most evidence of that disaster can disappear in about a year’s time, perhaps.  But you’d think if it was the worst disaster of all time some of it would stick around a bit longer than that.  But it didn’t.  Which kind of lowers the bar for ‘worst of all time’ disasters, doesn’t it?  Here’s a follow-up published last April.  And it turns out that Deepwater Horizon was less worse than the Exxon Valdez disaster (see BP oil spill: Dramatic recovery of Gulf of Mexico one year on by Philip Sherwell posted 4/10/2011 on The Telegraph).

The Sunday Telegraph accompanied an assessment team scouring low-lying fingers of mud and marsh grasses along a 20 mile stretch of bayou where the river pours into the sea, the nearest point on land to the disaster site.

The phragamites reeds surveyed by the team leader Ivor van Heerden and scientists from the parish, state and federal governments took a direct hit last year.

But last week they found not even residual traces as the captain negotiated through the marshes on a flatbed airboat designed for swamps.

New shoots were bursting out of the reeds, wading birds were nesting, molluscs clung to the stems and the air was thick with greenflies.

And further along the Gulf coast, the white sand beaches of the panhandle that were soiled by tar balls last summer look back to their pristine best, packed in recent weeks by college students enjoying the raucous annual institution of spring break.
“The spill was a disaster, but it was not the catastrophe that many people were portraying,” said Mr van Heerden, a marine scientist who once headed the Louisiana coastal restoration programme for the state’s fragile eco-system of wetlands.

It was his intervention last July that first challenged the assumed wisdom in America that the spill was an apocalyptic environmental catastrophe.

“A lot of people, and that includes politicians and journalists, did not want to hear the message that it was really not that bad,” he said…

Swaths of the Gulf were closed to fishing and over the next six months, nearly 7,000 dead animals were collected from the area – mostly birds but also 700 sea turtles and 100 dolphins – although in many cases the cause of death has not been determined.

But volume can be a misleading measure of a spill’s impact. In 1989 the Exxon Valdez tanker lost just five per cent of the oil that escaped into Gulf last year, but damage to the Alaskan coastline, wildlife and environment was much more devastating.

“This was no Exxon Valdez, not even close,” said Ed Owens, a British marine geologist and oil spill veteran who developed the industry standard for clean-up and monitoring after he worked on the chaotic response to that disaster…

Although the longer-term damage inflicted on the wildlife, marshes and waters of the Gulf is still being assessed, the fishing grounds and oyster beds are open again.

But traditional fishing communities on the slivers of land that poke into the sea south of New Orleans are still reeling from the impact, economically and mentally.

At a roadside seafood stand that his mother opened 32 years ago, Sean Maise has discounted the juicy four-inch long jumbo shrimps in his iceboxes to $3.50 a pound in an effort to woo custom. “It’s bad, real bad,” he lamented…

“We have probably the most rigorous testing in the world here and there has not been a single case of contaminated seafood found since the spill,” he said. “Nobody’s got sick from eating Louisiana seafood, but still people are nervous.”

This doesn’t sound like the worst disaster of all time.  Unless you want to include the devastation of the oil industry, then, yes, it ranks pretty high on the ‘worse’ scale.  But if you’re talking about spring break beaches and delectable seafood, then no.  Even though the people are scared to eat it despite the testing proving that it’s perfectly safe to eat.  Within a year things got back to pretty much normal.  Which kind of makes a mockery of the label ‘worst environmental disaster the nation has ever faced.’  And the economic destruction of the Gulf oil industry.

The Deepwater Horizon oil rig explosion was s disaster.  It killed eleven oil workers.  And then destroyed the livelihood of all their coworkers.  And reduced the amount of US crude oil in the domestic pipeline.  Raising the price at the pump.  This is the disaster.  The beaches and water are fine.  Just ask the college students enjoying spring break on the beaches.  In the water.  And eating the seafood.

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