Viewpoints : Should We Clean Up the Oil Transport Industry?

P unctured by its own anchor trying to moor in water just a few feet deeper than its hull, the American Trader bled more than 300,000 gallons of crude oil into the ocean off Huntington Beach, putting at risk the region’s $800-million shoreline economy.

And with the nation’s ears still ringing from other, not long - past, disasters--Exxon Valdez in Alaska and Arthur Kill in New York--debate has raged about what to do.

Should tankers be required to have double hulls and bottoms? Should oil companies be held liable for every penny’s worth of damage?

For a discussion on maritime petroleum policy, free-lance journalist Sharon Bernstein interviewed Charles Di Bona, president of the Washington-based American Petroleum Institute, and Lynne Edgerton, senior attorney with the Natural Resources Defense Council, an environmental group.

In separate interviews, they were asked the same questions and allowed to respond to each other’s views.

- Has the petroleum industry responded appropriately to recent oil spills such as Huntington Beach or Exxon Valdez?

Edgerton: No. In Exxon Valdez, their response was miserable. And the Exxon response in the recent Arthur Kill oil spill in New York state was completely inadequate. They let 567,000 gallons of oil spill into the Arthur Kill, which is a wonderful area of the Hudson. One of the worst things about it was during the first few days, they said they’d only spilled 5,000 gallons, so state officials who were trying to protect the wetlands didn’t get to protect them because they didn’t know how big it was.

That failure led to extensive wildlife death and contamination that could take itself two decades to work out of those marshes.

Di Bona: We’re concerned if there’s any spill, any place. We certainly want to take actions that reduce the likelihood of a spill and the size and area if one occurs.

For years we have advocated the creation of a super-fund for cleaning up oil spills. That ensures that everyone who is harmed has compensation.

As far as response, each of these is a different and difficult circumstance. All of the reports that I have seen and the people I have talked to from British Petroleum with regard to the Huntington Beach episode were all quite positive.

We have recognized that there was inadequate capability to deal with some of the larger spills; we’re taking steps to try to deal with that. Inevitably, it’s an uncertain matter. It depends on the weather, it depends on a lot of factors that are beyond our control. We are doing everything we can to try to speed up the process, including researching better methods of cleanup.

- What steps could be taken to improve industry response to such disasters in the future?

Di Bona: There is a bill on Capitol Hill right now which deals with oil spill liability and compensation and other aspects of transportation of oil. We have for many years supported the writing of such a bill, which includes the setting up of a fund to ensure people are fully compensated. It also would require that ships carrying oil have a set of contingency plans for dealing with a spill.

This bill also has some implications for an organization that the oil industry has created which is called PIRO, the Petroleum Industry Response Organization. The plan is to spend $400 million over the next five years, setting up five centers and 20-some-odd places where equipment will be pre-positioned to rapidly respond to a large spill. The capacity to clean up will be greater than anything that exists anywhere in the world.

Part of that program will also be to fund $35 million worth of additional research on how to do that better, to improve the techniques to clean up oil spills.

Edgerton: History has shown that a voluntary response center established by the oil companies is not enough to protect the environment. In Alaska, the seven oil companies there committed to the Alyeska emergency response center as part of getting pipeline through many years ago. Well, when the Exxon Valdez accident finally came along, the so-called crisis center was practically defunct. Over the years the commitment had dwindled, and it was totally inadequate. They have a tendency in response to public pressure to promise voluntary measures, which on the face of them sound constructive but in reality as time passes tend to get ignored and turn out not to be sufficient to handle the emergency when it occurs.

We want to see extended oil spill liability enacted by Congress.

- In a case like the Huntington Beach spill, in which the ship that spilled the oil was chartered to ship the oil and was not owned by British Petroleum, who should be responsible for cleaning up a spill?

Edgerton: Obviously the ship, if there was negligence, has to be liable as a matter of law. But I think that as a matter of public policy the industry should be responsible. After all, it is the industry that has made close to $900 billion out of Alaska. And not the public. So it is the industry that should bear that cost.

Di Bona: The owner of the oil has no control over the ship that it charters. The charterer is the operator of the ship, and that ship would certainly under this new law be required to have its contingency plans and all other factors in place. The person in control on the scene and the operator ought to be the liable party. We don’t think it should extend to the owner of the oil.

In fact, in order for a good Samaritan effort of cleanup to occur, a group that comes in to clean up which is not the spiller should be completely immune from liability. An immunity from liability is one thing the oil industry would need before setting up PIRO.

- What steps could be taken to avoid spills in the first place? Should double hulls be required on oil tankers?

Di Bona: We’ve enacted increased vessel control systems, which would act like air traffic control systems to maintain harbor safety.

We supported and encouraged the Coast Guard to ask the National Academy of Sciences to conduct a study of double-hulled, double-bottomed and other systems for ship construction, and that study is currently ongoing.

But we believe that it is uncertain what the best ship design is, and therefore we believe that a careful scientific study ought to be completed before something like a double hull is required on every ship.

Edgerton: The way a double hull works is that it essentially provides a safety space so that if the ship is injured or punctured, the oil isn’t released into the marine environment.

In the Alaska oil spill, in Exxon Valdez, it’s been shown by the Coast Guard study that the oil spill could have been cut in half, possibly down to zero, if the Exxon Valdez had been double-hulled. Most carriers are double-hulled in the world fleet. Hazardous waste carriers are all double-hulled. Oil is poisonous. Why aren’t oil carriers double-hulled?

Di Bona: Two ships have been lost, and it is believed that they were lost as a result of vapors geting into the voids between the two hulls and exploding.

Secondly, while there are circumstances under which the outer hull would be pierced but not the inner hull and therefore a spill avoided, there are circumstances when there is a greater impact where the whole ship might be lost if it had a double hull. The Exxon Valdez, if it had been a double-hulled ship, would have been penetrated through both hulls by the impact. It would not have protected against the loss of any oil, and more important, it would have upset the stability of the ship. It would have capsized.

Edgerton: The oil industry is fighting this double-hull issue tooth and nail.

They say it’s going to cost more, obviously. Of course it will cost more to have a double-hulled ship. It costs two to four percent more to have double hulls. On the other hand, Exxon Valdez is estimated to cost at least about $1 billion--they could have double-hulled 200 tankers for that.

Di Bona: Two to four percent; that’s just ridiculous. The environmentalists will give you information that bears no resemblance to reality on this. If she means double bottoms, that’s cheaper, but if she means double hulls, that’s more expensive.

There are 500 ships bringing oil to the U.S. To retrofit them all would cost $18.5 billion, including $2 billion for barges. And this would take many years because there is not enough shipbuilding capacity in the U.S. or worldwide to do this quickly.

- Should offshore drilling rigs be regulated along with tankers?

Di Bona: We believe that there is a big difference--and there ought to be a clear distinction--between problems associated with transportation and off-shore drilling facilities, which have a totally different record and have been conducted with an extremely fine environmental record.

Almost all oil from offshore rigs comes by pipeline, so the idea that you use tankers is on their part dishonest. They know that the great majority of it comes by pipeline. There’s very, very little offshore oil that comes by tankers. And if it does, it only comes that way because of a very special technical reason or because some group has prevented the building of a pipeline.

There are 29,000 offshore oil wells in United States. The total amount of oil that got into the water last year was 610 barrels, all of which was picked up.

Edgerton: Some of the offshore drilling rigs actually put the oil in tankers and the tankers put the oil into shore. Some use pipelines. But the Huntington Beach spill was the result of a ship coming up to moor to a pipeline that was going to a power plant offshore.

They’re inextricably linked; you have to find the oil once you bring it up. And oil is poisonous and human beings make mistakes.