Monday, May 17, 2010


"Worse than negligent but less than malicious."

It happened at four minutes after midnight, March 24, 1989.
These oil tankers are enormous. The Exxon Valdez measured almost eight stories tall, 166 feet wide, and 987 feet long, more than the length of three football fields.
It was carrying 53.6 million gallons of Prudhoe Bay crude oil when it left the Valdez Oil Terminal (where 3 to 4 of these tankers depart each day), in Valdez Alaska, at 9:13PM. It's destination was nearby Long Beach, California.
One of the oldest least known professions is that of a navigational pilot, a local mariner who is hired to help a vessel through congested or dangerous waters. On March 23rd, 1989, pilot William Murphy successfully guided the massive ship through the Valdez Narrows, with Captain Joe Hazelwood at his side. Upon entering Prince William Sound, Murphy left the ship and the Captain took over full command.
At 32 Joe Hazelwood had become the youngest Captain working for the Exxon's shipping company. He had been a Captain for 10 years before the Valdez incident. He was also an alcoholic who had been drinking vodka in a bar earlier in the evening (he was cleared of charges of being drunk on duty afterwards due to technicalities).
Icebergs were encountered in the Sound's out going sea lanes, and permission was sought after and gained from the Coast Guard for the ship to enter the incoming lanes to avoid them. Captain Hazelwood then left the bridge handing over control of the ship to the Third Mate, with specific instructions to return to the outgoing lanes at a certain point. He retired to his quarters.
For reasons that still remain unclear the Third Mate failed to return to the correct shipping lanes and the Exxon Valdez ran aground on the Bligh Reef (named after Captain Bligh, of The Bounty fame) at 12:04AM, rupturing it's hull and allowing 11 million gallons (only 1/5 of what the tanker was carrying) of crude oil to escape into the Sound.
The bulk of the oil spilled was released within 6 hours of the grounding. The Alyeska Pipeline Service Company was immediately notified of the accident and a tub was dispatched to help stabilize the Valdez. However the Spill Response Barge was out of service at the time and didn't arrive until 3:00PM. Still, it was overwhelmed with the magnitude of the spill, wherein Exxon took full responsibility for the accident and the subsequent clean up efforts.
For the first few days after the spill a large concentration of the oil remained close to Bligh Reef. A storm on March 26, with winds ranging up 70 MPH dispersed the oil over a much larger area, eventually covering 1,300 miles of coastline and 11,000 square miles of ocean.
Wikipedia tells us: "Thousands of animals died immediately; the best estimates include 100,000 to as many as 250,000 seabirds, at least 2,800 sea otters, approximately 300 harbor seals, 247 bald Eagles, and 22 orcas, as well as the destruction of billions of salmon and herring eggs. The effects of the spill continued to be felt for many years afterwards," and still continue ("despite the extensive cleanup attempts, less than ten percent of the oil was recovered and a study conducted by the National Oceanic and Atmospheric Administration (NOAA) determined that as of early 2007 more than 26 thousand gallons of oil remain in the sandy soil of the contaminated shoreline, declining at a rate of less than 4% per year").
It is estimated that Exxon spent 2 billion dollars while attempting to clean up the spill, and an additional 1 billion settling associated civil and criminal complaints.
An Anchorage jury awarded 5 billion dollars in punitive damages, which at the time (1994) was equal to one year's profit for the company (19.42 billion in 2009, down from 44.06 billion in 2008). Exxon felt that it should not have to pay more than 25 million because the spill was a result of an accident, and appealed the decision to the U.S. 9th Circuit Court of Appeals (after obtaining a 4.8 billion line of credit from J.P. Morgan & Co., in case the judgment was upheld. This gave J.P. Morgan the opportunity to create the first Credit Default Swap (CDS), a financial instrument that would play a prominent role in the Wall Street collapse of 2008).
After several decisions and appeals to the 9th Circuit, the case made its way to the Supreme Court, where the award was construed as excessive, and the case remanded back to a lower court.
Exxon's actions were deemed "worse than negligent but less than malicious," which I suppose made them "neglicious."
That judgment limited punitive damages to the compensatory damages, which was calculated as $507.5 million.
Litigation continues to this day.
Although the largest spill recorded within United States waters, the Exxon Valdez spill ranks down around the 50 range for worldwide spills according to volume released. However due to the remoteness of the area where the spill took place and the difficulty that presented when attempting to contain and clean up the aftereffects, this event is believed to be the largest disaster as far as human-caused environmental damage in history (excluding global warming).
And then came Deepwater Horizon...

To be continued.

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