Bush Sends Top Aides to Assess Spill Damage

President Bush Tuesday dispatched three top officials to Alaska to assess the massive oil spill there as political controversy began to escalate over Administration plans to expand oil drilling in an environmentally sensitive part of the state.

Bush summoned Transportation Secretary Samuel K. Skinner, Environmental Protection Agency chief William K. Reilly and Coast Guard Commandant Paul Yost to the Oval Office for an early morning meeting before sending them to Alaska to “take a hard look at where this disaster stands.”

Bush said after the session that he had received “conflicting reports” on the progress that Exxon Corp. had made in containing the spill. “I don’t want to prejudge that,” he said, asking the top-level team to report back to him on what additional steps may be needed.

Those steps could include federal civil penalties against Exxon, Skinner said. The Coast Guard, which is leading federal efforts to combat the spill, will be responsible for deciding whether Exxon violated federal regulations in its operation of the oil tanker that struck a reef and ruptured, causing the huge oil slick. Atty. Gen. Dick Thornburgh said that Justice Department lawyers also will monitor the situation.

With Exxon officials now admitting that the cleanup so far has gone poorly, Bush said that a federal takeover of the effort is “an option” that Skinner, Reilly and Yost would assess. Under that approach, which Administration officials currently consider unlikely, the government would pay for the cleanup and then seek reimbursement from the company. Federal disaster relief officials Tuesday also were reviewing a request from Alaska Gov. Steve Cowper for additional federal emergency aid.

Despite the attention generated by the scope of the spill--the largest in U.S. history and one of the worst ever--Bush said he felt no need to review his Administration’s plan to open the Arctic National Wildlife Refuge to oil drilling. “I see no connection” between drilling in the reserve and the contamination in Prince William Sound, Bush said.

Environmentalists, however, who have been battling the drilling plan for several years, lost no time in making a connection. Opening up the wildlife reserve to drilling, they stressed, would greatly increase oil shipping along the tanker route from the port of Valdez through Prince William Sound, the formerly pristine waterway fouled by about 10 million gallons of oil since the Exxon Valdez accident Friday.

The oil spill is a “giant alarm clock” that should awaken the nation to the environmental dangers that inevitably accompany major oil drilling programs, the “Group of 10” major environmental organizations said in a statement. Bush’s plan for “environmentally prudent” drilling in the wildlife reserve is a contradiction in terms, they said, and they asked for a new study to be made of the full environmental impact of drilling.

“We find no independent scientists who say you can develop the Arctic coastal plain in an environmentally prudent way,” said former Wisconsin Sen. Gaylord Nelson, who now heads the Wilderness Society.

The environmental groups called on Bush to ask the National Academy of Sciences to conduct the new impact study, noting that Bush already has ordered such a review of drilling off two sections of the California coast.

Although Administration officials argue that the oil from the wildlife area is needed to reduce U.S. dependence on foreign oil imports, environmental advocates argue that energy conservation measures, such as increasing the fuel efficiency of new cars, could have the same impact.

Environmentalists have made a long series of objections to drilling in the reserve, which is the principal calving area for 180,000 migratory caribou and a breeding ground for 300,000 geese and millions of shore birds.

In addition to the risk of further tanker accidents, they charge that noise and exploration activity could disrupt wildlife and toxic drilling muds and other wastes could seriously pollute the areas around the wells.

“No matter how many precautions are taken, the unthinkable can still happen,” said Lisa Speer, a senior attorney for the Natural Resources Defense Council. “The only way to keep the unthinkable from happening in environmentally sensitive areas is to keep oil development out.”

While arguments escalated about future policy, Administration officials continued to try to sort out an appropriate government response to the spill.

Administration officials said that the review team is not likely to recommend a federal takeover, preferring the current system in which Exxon is directly paying the costs of removing the oil from the waters and shores of Prince William Sound.

The company has said that it would cover the full cost of the cleanup, but an Exxon spokesman Tuesday indicated that the company probably would seek reimbursement from a special industry fund to cover at least some of its costs. Under the legislation that first set up the Alaska pipeline system a decade ago, each of the seven oil companies drilling in Alaska agreed to pay up to $14 million for any cleanup costs. In addition, the companies agreed to set up a fund to cover up to an additional $86 million in damages for any oil spill.

If cleanup costs and damages exceed $100 million, however, extensive litigation to establish company negligence might be necessary to obtain more money. In 1978, for example, the Amoco Cadiz, a supertanker owned by Amoco Corp., went aground on the coast of France during a gale, creating a spill six times larger than the current Alaska spill. The final damages in that case, about $117 million, were only established last month by a federal judge in Chicago who has continued to preside over the case despite having retired in the years it has dragged on.

In part because of that problem, Transportation Department officials said Tuesday that a government takeover of the clean-up effort would occur only if Exxon appears unable to handle the task. The federal government would not be eager to pay the bill until the matter was resolved.

“At the moment it seems both unwise and unlikely, unless something happens that changes our mind,” a senior Transportation Department official said.