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Andrew J. Garger. Vice President, Legal & General Counsel Water Quality Insurance Syndicate. Do You Remember?. OPA’s Predecessors. Water Quality Improvement Act Federal Water Pollution Control Act Clean Water Act Outer Continental Shelf Lands Act Amendments

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Andrew j garger

Andrew J. Garger

Vice President, Legal & General Counsel

Water Quality Insurance Syndicate


Do you remember

Do You Remember?


Opa s predecessors

OPA’s Predecessors

  • Water Quality Improvement Act

  • Federal Water Pollution Control Act

  • Clean Water Act

  • Outer Continental Shelf Lands Act Amendments

  • Trans-Alaska Pipeline Authorization Act

  • Deep Water Ports Act


The oil pollution act of 1990 opa p l 101 380

THE OIL POLLUTION ACT OF 1990 (OPA) P.L. 101-380

Responsible Party:Owner, Operator or Charterer by demise

Nature of Liability:Strict, joint and several


The oil pollution act of 1990 opa p l 101 3801

THE OIL POLLUTION ACT OF 1990 (OPA) P.L. 101-380

Pollutant:Oil of any kind, except if classified as an hazardous substance under CERCLA

Jurisdiction: Navigable waters, adjoining shorelines, or the Exclusive Economic Zone


Opa liability limits

OPA LIABILITY LIMITS

  • Higher for Single Hulled Vessels than for Double Hulled Vessels.

  • Example: 3000 gross ton double hulled vessel has limit of the greater of $2000 per gross ton or $17,800,000

  • Single hulled tank vessel same size the greater of $3200 per gross ton or $23,496,000


What is recoverable

WHAT IS RECOVERABLE ?

  • Lost Revenue

  • Lost Profits

  • Increased Costs of Public Services

  • Removal Costs

  • Natural Resource Damages

  • Damage to Property

  • Loss of Subsistence Use


Spill response overview

Spill Response Overview

  • Types of Incidents

  • Types of Spilled Products

  • Responsible Party’s (RP) Initial Response

  • MPRG


Spill response overview continued

Spill Response Overview Continued

  • USCG Involvement

  • Other Government Agency Involvement

  • Response Resource Availability

  • Security Issues Under the MTSA


Spill response overview continued1

Spill Response Overview Continued

  • Third Party Issues and Concerns

  • Things that can Drive the Cost of the Spill Response

  • Natural Resource Damage Assessment (NRDA) Considerations


Mississippi river spill

Mississippi River Spill

Collision July 23rd – Barge DM-932, TUG MEL OLIVER, M/V TINTOMARA

  • Mile 99 near entrance to Harvey Canal

  • Approximately 9000 bbls of #6 oil (heavy). Approx. half spilled

  • ACL, owner of the DM-932 (double skinned barge) is responsible party


Mississippi river spill1

Mississippi River Spill

CASUALTY RESPONSE

  • On scene- spill response managers, spill response contractors, environmental experts, Coast Guard, state officials, 3rd party claims handlers.

  • Over 1000 responders at height of cleanup.


Mississippi river spill2

Mississippi River Spill

SPILL RESPONSE

  • Coast Guard closed 58 miles of the Mississippi River (at least 3 days).

  • Down-river water intakes boomed off.


Mississippi river spill3

Mississippi River Spill


Mississippi river spill4

Mississippi River Spill


Mississippi river spill5

Mississippi River Spill


Mississippi river spill6

Mississippi River Spill


Mississippi river spill7

Mississippi River Spill


Andrew j garger

Aggressive Cleanup Measures


Mississippi river spill8

Mississippi River Spill

Public Commentary (NOLA.COM)

  • “Was Joseph Hazlewood piloting the tanker?”

  • “Sounds like someone had too much to drink.”

  • “How in the hell do you not see a 600 foot tanker? Can you say DUI.?”

  • “Sounds like Al Qaeda.”

  • “I might just call it a day and get on out of work and throw and oil spill party.”

  • “If they were only using Cosmo Kramer’s bladder system that he invented this could have all been avoided.”


Mississippi river spill9

Mississippi River Spill

Coast Guard Investigation

  • Many hearings held.

  • Barge Pilot took the 5th

  • Preliminary Statement by Coast Guard indicated improper licensure.

  • Ultimately criminal charges were brought against the tug.


Natural resource damage assessment

Natural Resource Damage Assessment

Natural Resource Damage Assessment

  • Huge potential damages

  • Passive-Use (loss of enjoyment)

  • Wildlife habitats

  • Bird kills


Mississippi river spill10

Mississippi River Spill

Class Action Lawsuits

  • At least six filed naming ACL, DRD, and others.

  • Includes loss of revenue claims.

  • Classes have not been certified.


What is a natural resource

WHAT IS A NATURAL RESOURCE ?

  • CERCLA AND OPA ‘90 DEFINE “NATURAL RESOURCES” AS LAND, FISH,WILDLIFE, BIOTA, AIR, WATER, GROUNDWATER, DRINKING WATER SUPPLIES, AND OTHER SUCH RESOURCES.

  • INJURY REFERS TO THE ACTUAL ADVERSE IMPACTOR LOSS OF THE NATURAL RESOURSE RESULTING DIRECTLY OR INDIRECTLY FROM EXPOSURE TO A RELEASE OR THREAT OF RELEASE OF OIL OR A DISCHARGE OR RELEASE OF A HAZARDOUS SUBSTANCE.

  • DAMAGE IS THE AMOUNT OF MONEY SOUGHT BY THE TRUSTEES TO COMPENSATE FOR THE INJURY THROUGH RESTORATION OR REPLACEMENT PROJECTS.


Alphabet soup

ALPHABET SOUP

  • H.E.A.- HABITAT EQUIVALENCY ANALYSIS

  • R.E.A. – RESOURCE EQUIVALENCY ANALYSIS

  • COMPLEX FORMULAE USED TO FIGURE OUT WHAT NEEDS TO BE DONE TO CREATE, RESTORE OR PROTECT THE INJURED RESOURCE .


The gulf spill

THE GULF SPILL

  • LARGEST SPILL IN HISTORY ??

  • MASSIVE SPILL RESPONSE

  • EVERY TYPE OF CLEANUP TECHNOLOGY BEING USED

  • EFFECTS WILL BE FELT FOR YEARS IF NOT DECADES.


Largest spills

LARGEST SPILLS

  • Lakeview Gusher, CA. 9 Mill. Bbls.

  • Deepwater Horizon 3-8.7 Mill. Bbls.

  • Gulf War 2-6 Mill BBLS.

  • Ixtoc I - Gulf of Mexico 3.5 Mill Bbls.

  • Exxon Valdez – 257,000 Bbls.

  • Yet, only 8% of oil in water every year is from tanker /pipeline/well spills.


Example of modu

EXAMPLE OF MODU


Coast guard search and rescue

COAST GUARD SEARCH AND RESCUE


Coast guard response

COAST GUARD RESPONSE


Coast guard response1

COAST GUARD RESPONSE


Coast guard response2

COAST GUARD RESPONSE


Surveillance flights

SURVEILLANCE FLIGHTS


Overflight photo

OVERFLIGHT PHOTO


Overflight gulf of mexico

OVERFLIGHT – GULF OF MEXICO


Overflight photo1

OVERFLIGHT PHOTO


Overflight map

OVERFLIGHT MAP


Bp command center

BP COMMAND CENTER


Spill trajectory map

SPILL TRAJECTORY MAP


Response status

RESPONSE STATUS


Local government involvement

LOCAL GOVERNMENT INVOLVEMENT


Various response activities

VARIOUS RESPONSE ACTIVITIES


Staging area boom

STAGING AREA - BOOM


Staging area boom1

STAGING AREA - BOOM


Shoreline protection sandbags

SHORELINE PROTECTION - SANDBAGS


Use of military craft

USE OF MILITARY CRAFT


Oil in water

OIL IN WATER


Oil skimming

OIL SKIMMING


Oil skimming1

100716-G-5030M-007-- GULF OF MEXICO -- Crewmembers monitor the oil skimming set-up aboard CGC Walnut, a 225-foot sea-going buoy tender based in Honolulu while CGC Resolute stands by in the background. The Walnut is skimming oil near the BP oil spill site after transiting the Panama Canal. Coast Guard photo by Petty Officer 1st Class John Masson. 

OIL SKIMMING


Modified fishing vessel

MODIFIED FISHING VESSEL


Oil skimmer

OIL SKIMMER


Skimming operations

SKIMMING OPERATIONS


Boom in florida

BOOM IN FLORIDA


Emulsified oil

GULF OF MEXICO - Vessels of Opportunity participants chase and corral oil near Dauphin Island, Ala. More than 38,000 people are participating in the nation's largest oil spill response in history. U.S. Coast Guard photo. 

EMULSIFIED OIL


Largest oil skimmer ever

LARGEST OIL SKIMMER EVER


Largest oil skimmer ever1

LARGEST OIL SKIMMER EVER


Beach cleanup scat team

BEACH CLEANUP - SCAT TEAM


Beach cleanup

BEACH CLEANUP


Beach cleanup1

BEACH CLEANUP


Marsh grass cleanup

MARSH GRASS CLEANUP


Snare boom

SNARE BOOM


Containment boom

CONTAINMENT BOOM


Containment boom and sorbent boom

CONTAINMENT BOOM AND SORBENT BOOM


Sorbent and protective boom

SORBENT AND PROTECTIVE BOOM


Protective boom

PROTECTIVE BOOM


Protective booming

PROTECTIVE BOOMING


In situ burning

IN-SITU BURNING


In situ burning1

IN SITU BURNING


In situ burning2

IN – SITU BURNING


Chemical dispersants

CHEMICAL DISPERSANTS


Chemical dispersants1

CHEMICAL DISPERSANTS


Diver searching for underwater pollution

DIVER – SEARCHING FOR UNDERWATER POLLUTION


Subsea dispersants

SUBSEA DISPERSANTS


Breton national wildlife refuge

BRETON NATIONAL WILDLIFE REFUGE


Brown pelican again

BROWN PELICAN AGAIN


Wildlife

WILDLIFE


Sea turle nest

SEA TURLE NEST


Sea turtle nest

SEA TURTLE NEST


Sea turtle

SEA TURTLE


Top kill procedure

TOP KILL PROCEDURE


Top hat

TOP HAT


Attempt to cap the well

ATTEMPT TO CAP THE WELL


Loop current research

LOOP CURRENT RESEARCH


Decontamination at ports

DECONTAMINATION AT PORTS


Decontamination site

DECONTAMINATION SITE


Decontamination

DECONTAMINATION


Decontamination1

DECONTAMINATION


Political visits

POLITICAL VISITS


Media response

MEDIA RESPONSE


What now

What Now?


Current situation

Current Situation

  • 94 and 180 million gallons have spilled (2.2-4.4 million barrels)????

  • Successful Capping of Well (for now)

  • Need to be removed if leaking

  • Oil would flow freely again

  • Would then try to use subsea containment systems to capture escaping oil and divert to surface vessels.


Relief well

RELIEF WELL


Relief well1

RELIEF WELL


Aftermath of gulf spill

Aftermath of Gulf Spill

  • MOST EXPENSIVE SPILL IN HISTORY: 3.5 million in cleanup expenses

  • DRIVING MASSIVE POLITICAL RESPONSE

  • CONGRESSIONAL HEARINGS AND LEGISLATIVE PROPOSALS

  • ECOLOGICAL FALLOUT

  • CRIMINAL PROBE

  • ECONOMIC EFFECTS

  • CVIL LAWSUITS


Political action

Political Action

  • Congressional Hearings

  • Legislative Proposals

  • “Independent “Presidential Commission

  • Extralegal Pressure

  • Who should be in charge, Dept. of Interior or Coast Guard


Ecological fallout

ECOLOGICAL FALLOUT

As of July 17, 2010

  • 2,200 dead birds found

  • 500 dead sea turtles

  • 590 miles of Gulf shoreline oiled

  • 1/3 to ½ fisheries are closed

  • Fisheries imperiled, including shrimp/crabs

  • Underwater plumes of oil found

  • Oil getting into food chain - crabs


Nrda as a result of ecological fallout

NRDA as a result of Ecological Fallout

  • Assessment of environmental effects to determine what BP must pay to restore the Gulf Environment.

  • Inexact Science


Drilling moratorium

Drilling Moratorium

  • First one overruled in Court, reissued by Administration

  • 8000 drilling workers and 24,000 people who service the 33 rigs effected have future employment jeopardized

  • $750 million in annual wages


Other economic effects

Other Economic Effects

  • Tourism down

  • Fishing: The fisherman, companies that build and maintain boats, people who process and resell catch, and the restaurants.

  • 20 billion compensation fund set up

  • Factors for payment: Proximity to Coast, dependence on resources, industry.


See you in court

SEE YOU IN COURT

  • Government Criminal Probe – Low burden of proof, Migratory Bird Treaty Act, Refuse Act, Criminal Negligence.

  • Settlement s to injured and killed

  • Hundreds of Economic Claims but mitigated by BP Settlment Fund.


Oil in new york

Oil in New York ??

  • Supercomputer simulations suggest it is likely oil will move up the East Coast

  • Within next six months.

  • Factors: wind speed, current patterns, temperatures and past weather patterns.


Long term outlook

Long Term Outlook

  • Move more oil by tanker??

  • Natural gas/ nuclear/Wind Farms

  • Green energy

  • Resources will bounce back – Exxon Valdez

    • www.evostc.state.ak.us/facts/qanda.cfm


Thanks

Thanks!


Breaking liability limits

BREAKING LIABILITY LIMITS

  • Gross negligence, willful misconduct (no privity or knowledge of owner required).

  • Violation of federal safety, construction or operating standard.

  • Failure to report spill or cooperate with clean-up.


Bp spill issue breaking liability limits

BP Spill Issue BREAKING LIABILITY LIMITS

  • Gross negligence, willful misconduct. (no privity or knowledge of owner required)

  • Violation of federal safety, construction or operating standard.

  • Failure to report spill or cooperate with clean-up.


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