Four Years Later, a Sharp Divide on Gulf Oil Spill

GRAND ISLE, LA - JULY 17: Workers clean a beach on July 17, 2010 in Grand Isle, Louisiana. Louisiana has reopened most of the waters of the Gulf of Mexico to recreational fishing. The cap sealing the BP oil well in the Gulf of Mexico has remained sealed in the testing period offering a glimmer of hope in the disaster. (Photo by Mario Tama/Getty Images)
National Journal
Mike Magner
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Mike Magner
April 20, 2014, 7:22 a.m.

The state of the Gulf of Mex­ico four years after the worst oil spill in U.S. his­tory is as un­clear as a marsh soaked with pet­ro­chem­ic­als. The state of BP, on the oth­er hand, is power­ful and proud, with the Brit­ish en­ergy gi­ant show­ing little tol­er­ance for cri­ti­cism over the in­cid­ent.

A spate of re­ports and press re­leases lead­ing up to the an­niversary of the dis­aster, which took place April 20, 2010, sketch a pic­ture of a re­gion still awash in oil and tar, with fish and wild­life strug­gling to sur­vive and thou­sands of people suf­fer­ing from both eco­nom­ic and phys­ic­al or men­tal dis­tress.

Those as­sess­ments stand in stark con­trast to BP’s de­clar­a­tion last week that “act­ive cleanup” is com­plete and on­go­ing res­tor­a­tion work “is help­ing the Gulf re­turn to its baseline con­di­tion, which is the con­di­tion it would be in if the ac­ci­dent had not oc­curred.”

An of­fi­cial ac­count­ing of the spill’s im­pacts won’t come un­til at least next year, when the gov­ern­ment com­pletes a Nat­ur­al Re­source Dam­age As­sess­ment as part of its con­tinu­ing lit­ig­a­tion against BP and its part­ners over the spill, which re­leased more than 200 mil­lion gal­lons of oil in­to the Gulf, ac­cord­ing to the gov­ern­ment.

The tri­al in fed­er­al court in New Or­leans is cur­rently between phases, with a rul­ing pending from U.S. Dis­trict Judge Carl Bar­bi­er on ex­actly how much oil leaked from BP’s Ma­condo well. The com­pany ar­gued last fall that the amount was about 2.5 mil­lion bar­rels, while the Justice De­part­ment puts the fig­ure at more than 4 mil­lion bar­rels. Once that is­sue is settled, the fi­nal phase of the tri­al will be­gin in Janu­ary to de­term­ine what if any fines and pen­al­ties should be as­sessed.

In the mean­time, res­id­ents of the five Gulf states con­tin­ue to be bom­barded with in­form­a­tion about the ef­fects of the spill, much of it dra­mat­ic and dis­turb­ing. Re­ports come in reg­u­larly about beaches be­ing re-oiled by storms and tar balls wash­ing ashore. Flor­ida of­fi­cials an­nounced in Feb­ru­ary that about 1,250 pounds of pet­ro­leum waste was found mov­ing through shal­low wa­ters off the coast of Pensa­cola.

Stud­ies by fed­er­al sci­ent­ists, uni­versity re­search­ers, and en­vir­on­ment­al groups have doc­u­mented de­form­it­ies in fish em­bry­os ex­posed to oil, sick and dy­ing dol­phins, and hun­dreds of dead turtles float­ing in the sea. And a doc­u­ment­ary out on Fri­day, Van­ish­ing Pearls, de­scribes the dev­ast­at­ing im­pact of the spill on Afric­an-Amer­ic­an oyster­men in coastal Louisi­ana.

The ef­fects on oth­ers in the sea­food and fish­ing in­dus­tries, es­pe­cially the thou­sands who helped with the spill cleanup in 2010, are es­pe­cially troub­ling. A Na­tion­al In­sti­tutes of Health study is track­ing 33,000 people who were ex­posed to the oil and is find­ing a host of res­pir­at­ory prob­lems and skin con­di­tions. Oth­ers re­port that fish­er­men af­fected by the spill are more likely to have bouts with de­pres­sion.

As part of the fed­er­al case against it, BP agreed in Feb­ru­ary to a set­tle­ment that will com­pensate as many as 200,000 cleanup work­ers who can doc­u­ment ill­nesses re­lated to the spill. The amounts could be as much as $60,700 per in­di­vidu­al, in some cases.

But the com­pany has been far less will­ing to con­cede the harm done to nat­ur­al re­sources, and has lashed out at its crit­ics.

“Des­pite the nu­mer­ous signs of pro­gress — from re­cord tour­ism to a thriv­ing fish­ing in­dustry and the end of act­ive cleanup op­er­a­tions — some ad­vocacy groups re­fuse to ac­know­ledge evid­ence of the re­gion’s re­cov­ery,” BP’s Geoff Mor­rell said in a state­ment last week. “In­stead, they cherry-pick the find­ings of sci­entif­ic re­ports, or blithely mis­char­ac­ter­ize them, to sup­port their agen­das.”

Larry Sch­wei­ger, pres­id­ent and CEO of the Na­tion­al Wild­life Fed­er­a­tion, re­spon­ded: “Four years after the ini­tial ex­plo­sion, the oil is not gone and it is still hav­ing an im­pact on wild­life in the Gulf of Mex­ico. BP has chosen to at­tack the sci­ence and its mes­sen­gers in­stead of tak­ing re­spons­ib­il­ity for restor­ing the Gulf.”

So far BP says it has spent about $27 bil­lion on claims pay­ments, cleanup work, and res­tor­a­tion pro­jects in the Gulf, and it has set aside about $15 bil­lion more in an­ti­cip­a­tion of fines and pen­al­ties. It has also denied bil­lions of dol­lars in claims that it deemed fraud­u­lent or ex­cess­ive.

“We have looked to do the right thing by those who were af­fected by the ac­ci­dent and spill,” BP chief ex­ec­ut­ive Robert Dud­ley said at the com­pany’s an­nu­al meet­ing April 10. “But also to do the right thing by our in­vestors when it be­came clear that the sys­tem for com­pens­at­ing claimants was sub­ject to a con­sid­er­able num­ber of un­foun­ded claims.”

After ban­ning BP from new fed­er­al con­tracts in Novem­ber 2012, the En­vir­on­ment­al Pro­tec­tion Agency lif­ted the sus­pen­sion March 13 in re­turn for a five-year agree­ment by the com­pany to make im­prove­ments in safety and cor­por­ate eth­ics. Less than two weeks later, a BP re­finery south of Chica­go leaked more than 1,600 gal­lons of oil in­to Lake Michigan, the source of fresh wa­ter for mil­lions in the re­gion, and howls were heard again about the com­pany’s en­vir­on­ment­al re­cord.

“Time and again BP has shown it can’t do busi­ness without put­ting people and wild­life at ser­i­ous risk,” said Jaclyn Lopez, an at­tor­ney at the Cen­ter for Bio­lo­gic­al Di­versity. “How many more spills will it take for the Obama ad­min­is­tra­tion to say enough is enough?”

BP says that at no time has the spill af­fected drink­ing-wa­ter sup­plies and that all the oil has been cleaned up. The com­pany was so mind­ful of its repu­ta­tion after the in­cid­ent that it even de­man­ded a cor­rec­tion in a stu­dent news­pa­per at Al­bion Col­lege in Michigan after a colum­nist wrote that a BP spokes­man was not well in­formed about the Lake Michigan spill.

The com­pany’s ag­gress­ive pos­ture has served BP in­vestors well. Des­pite the $40 bil­lion hit from the Gulf spill that has forced it to sell off as­sets and cut cap­it­al ex­pendit­ures, BP is get­ting high rat­ings from ana­lysts and ex­pects to in­crease its drilling op­er­a­tions in the Gulf of Mex­ico, where it cur­rently has 10 rigs op­er­at­ing. The com­pany re­cently ac­quired 24 new leases in the Gulf for $41.6 mil­lion, in­clud­ing 11 tracts not far from the form­a­tion where the Ma­condo blo­wout oc­curred.

Even BP’s former CEO, Tony Hay­ward, ap­pears to have landed well after be­ing dis­missed by the com­pany in the wake of the spill. A Lon­don news­pa­per re­por­ted this month that Hay­ward is likely to be­come chair­man of the com­mod­it­ies gi­ant Glen­core Xstrata, while an­oth­er said Hay­ward and his pre­de­cessor as BP CEO, Lord John Browne, are team­ing up on a $281 mil­lion drilling pro­ject off the coast of An­gola.

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