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Environment

Paying for their messes: the record for oil companies isn't stellar

People affected by the Exxon Valdez oil-spill disaster had to wait two decades before being compensated. It could well be the same with BP, since oil concerns often find ways to avoid paying compensation after spills.

Exxon Valdez

The Exxon Valdez spilled more than 270,000 barrels of crude oil in Prince William Sound

The second-biggest oil spill in US history happened on March 24, 1989 when the Exxon Valdez oil tanker ran aground on the Bligh Reef in Prince William Sound, Alaska. The region's unique, largely untouched coastal landscape was inundated with 40,000 tons of oil that escaped from the vessel, and hundreds of thousands of birds and fish, along with thousands of mammals, died.

Public outrage over the spill was huge and the area's residents were promised generous compensation packages. However, the reality turned out to be quite different than those affected had hoped.

"There was a famous quote when the Exxon Valdez happened that said 'lawyers not even born yet will be working on this case.' And that is indeed what has transpired," said Greenpeace's Cindy Baxter, who has followed the Exxon disaster for years.

She said Exxon has taken the case through numerous courts, with the result being that the original $5 billion (3.9 billion euros) of the estimated compensation amount has been reduced to $500 million.

In the meantime, she added, people who were expecting compensation have died during the wait, including clean-up workers who suffered major health problems from working with the dispersants used in the wake of the spill.

Low compensation levels

She fears that the situation will be similar in the case of the Gulf of Mexico spill, set off after an explosion on BP's "Deepwater Horizon" oil drilling platform.

BP oil leak

Many experts fear BP will not pay adequate compensation for the oil leak

Up to now, BP has paid more than $3 billion for damage containment, although only $150 million of that is made up of compensation payments to people affected by the massive offshore oil spill, the largest in US history.

In large swaths of the affected areas, whole economic sectors such as fishing and tourism, have come to a standstill.

"The Gulf is home to all these different types of fisheries and those fisheries will not recover," said Baxter. "If you look at the Valdez, so many of the fisheries there have not recovered at all."

Not an isolated case

But the Exxon Valdez case is not unique, and the consequences of another oil catastrophe are now being dealt with in Amsterdam.

In August 2006 the freighter "Probo Koala" unloaded around 500 tons of toxic waste on a public dump site in the Ivory Coast. At least 17 people died and ten thousand are still suffering health problems as a result. The hazardous material was made up of highly toxic oil residue.

Gas flares in the Niger Delta

The Niger Delta has the largest concentration of gas flares in the world

While London-based oil trader Trafigura, one of the world's biggest private oil companies, did not admit guilt in the matter, it did come to an agreement with the government in Abidjan, paying a lump sum of $150 million for clean-up and disposal efforts.

Those people directly affected by the toxic waste, however, were offered just around $1,000 in compensation.

"Europe needs to keep its own waste and not come here and make a profit by turning impoverished Africa into a trash dump," said Rochel Gogoua, one of the victims of the environmental scandal. "Trafigura is criminal in the way it has handed out a pittance to its victims. The company is a disgrace for the whole world and needs to be shut down."

But while the company is now facing criminal charges in an Amsterdam court over the incident which caused international uproar last year, it is unlikely it will be forced to pay further compensation.

Those living in the slums of Akuedo in Abidjan, however, have to continue living with the contamination; the toxic waste has still not been cleaned up.

Delta disaster

In Nigeria's Niger Delta, where oil giant Royal Dutch Shell is active, a similar story has played out. For half a century, the region has been exploited by foreign companies looking for easy-to-refine oil.

Experts work to remove toxic waste at a site near Akuedo village, Ivory Coast

Experts work to remove toxic waste at a site near Akuedo village, Ivory Coast

According to estimates by environmentalists, over that time some two billion liters of oil have spilled into the delta, which corresponds roughly to about one accident of "Exxon Valdez" proportions per year.

The black crude has contaminated the marshes, mangrove swamps and waterways of the delta, an area about the size of Portugal.

"I am from the Niger Delta: I grew up in the creeks. I am not a stranger to oil spills and their devastating effects," said Ankio Briggs, an environmental activist. "Since 40 years we've been experiencing spills, gas flaring and all that."

Wherever oil exploration takes place, companies and shareholders rake in profits while the local population is often left on its own to bear the environmental and social costs that arise. And those costs, according to Greenpeace's Cindy Baxter, will be passed on from today's generation to tomorrow's.

"If you dig on any beach in Prince William Sound, you will find oil. Species and fisheries there have never recovered," she said. "Prince William Sound will never be what it was before the Exxon Valdez."

Author: Helle Jeppesen (jam)

Editor: Susan Houlton

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