Alaska House Rejects $1-Billion Exxon Oil Spill Pact

The Alaska House rejected a $1-billion settlement of the Exxon Valdez oil spill litigation Thursday, which could kill the proposed pact between Exxon Corp. and the state and federal governments.

The vote isn’t binding on Gov. Walter J. Hickel, but he has said he would terminate the settlement if the Legislature did not approve it. The lawmakers urged Hickel to renegotiate the pact to get more favorable terms.

The action came one week after a federal judge tossed out the proposed settlement’s criminal plea bargain. He said its $100-million fine for Exxon was inadequate for the nation’s worst oil spill.

The House passed a resolution rejecting the settlement by a 27-13 vote. Many lawmakers complained the settlement did not provide enough money considering the size of the disaster and its effect on Alaska. The measure now goes to the Senate.

Exxon spokesman Joe Tucker in Anchorage said the company would have no immediate comment on the House vote.

The settlement would be the largest of an environmental damage case in U.S. history.

In addition to the $100-million criminal fine, it would have required Exxon to pay $900 million over 11 years to restore natural resources damaged in Prince William Sound and the Gulf of Alaska. That would have settled all state civil claims against the huge oil company and any the federal government might have brought.

Nearly 11 million gallons of crude oil gushed from the tanker Exxon Valdez after it ran aground on a charted reef on March 24, 1989. The disaster killed countless fish, birds and marine mammals and disrupted commercial fishing and the subsistence lifestyle of the region’s Native peoples.

The House resolution suggests Hickel seek a $1.2-billion settlement. It proposed that Exxon pay $700 million within one year to settle the civil claims and a $500-million criminal fine. It also said the Legislature should be given more control over how the money is spent.

Because the $900 million would have been paid over more than a decade, its real value after inflation would have been far less. An Associated Press analysis showed an annuity for that amount could cost Exxon as little at $486.3 million.