Changed Oil Industry Standards, Research Paper Example

The topic of this paper is the March, 1989 oil spill from the maritime tanker Exxon Valdez in Alaskan waters. It forever changed industry standards and the way oil companies operate. Some of the changes, like the double-hull requirement, initially affected only the Prince William Sound shipping channel where the accident occurred. But subsequent oil-shipping disasters forced their gradually worldwide adoption (Tanker World, 2007).

In general, the operational changes instituted after the accident can be termed prevention and response. The preventative measures consist of mandatory tanker escorts and support vessels; advanced pilot training and certification; double-hulled tankers (to be fully implemented by 2015 for U.S. ports); U.S. Coast Guard and satellite global-positioning systems (GPS) ship-tracking protection; and closer Alaskan state oversight. The response measures include more equipment-storage locations and more equipment on hand; better oil recovery technology; more and better-trained responders; hatchery protection; recruitment of citizens and fishermen (and their boats) into the emergency response system; wildlife rescue measures; practice drills; a unified response command structure, modeled on wildfire-fighting responses; and advanced emergency communication technology with further reach into Alaska itself (Then and Now, 2009). More recently, social media can announce accidents instantly to the world.

Legally, the case eventually set a precedent when, as the result of a class-action lawsuit, the Supreme Court ruled 5-3, in June of 2008, that punitive awards should not exceed actual damages, effectively limiting Exxon’s additional liability to $507 million (Struck, 2009). Although this will certainly affect the liability of companies held responsible for future accidents, Exxon still paid $3.8 billion as the result of legal settlements with state and federal governments in 1991. Also, there will likely be attempts to increase the amount of damages that companies can be held responsible for, probably through the increased valuations of the natural environment and its wildlife. (Even today, there is great disagreement over how much oil was actually spread by the damaged Exxon Valdez, with estimates ranging from 11 million gallons —the approximate size of 125 Olympic-sized swimming pools — to 25 million gallons.) Better prevention and recovery technology, although more effective (at least in some cases), will also be more expensive to keep and to maintain, even with the goal of never having to use it.

The final legal consequence of the 1989 oil spill was the Oil Pollution Act (OPA), signed into law in August of 1990. It has eleven key provisions dealing with the apportionment of responsibilities and liabilities;[1] the setting of civil and criminal penalties; and the establishment of a trust fund, currently set at $1 billion (Overview, 2011). These laws affect any ship doing business in American waters, so their reach is international. The cumulative effect of such laws, as well as the public perception of negligence or arrogance (which stuck to British Petroleum after the Deepwater Horizon offshore oil-spill in the Gulf of Mexico in 2010), has put increased pressure on oil and shipping companies not only to mandate greater expenditure on the prevention of accidents and their cleanup as well, but to improve their own public image. Today, those in the energy business must, more than ever, be seen as green in thought and deed.

The wreck of the Exxon Valdez, remains one of the largest U.S. spills, but is no longer in the top 50 internationally. Catastrophic accidents are still a part of the oil business, and as long as the world’s energy is petroleum-based, the world will have to repeatedly pay the price for them.

Works Cited

Overview. 28 January 2011. <http://www.epa.gov/osweroe1/content/lawsregs/opaover.htm>.

Struck, Doug. Twenty Years Later, Impacts of the Exxon Valdez Linger. 24 March 2009. <http://e360.yale.edu/feature/twenty_years_later_impacts__of_the_exxon_valdez_linger/2133/>.

“Tanker World.” Ocnus.net 3 May 2007. <http://www.ocnus.net/artman/publish/article_28810.shtml>.

Then and Now. March 2009. <http://dec.alaska.gov/spar/evos/thennow.htm>.

[1] Such as the setting of a liability limit of $1200 per gross ton, or $10 million, whichever is greater, to tank vessels of 3,000 gross tons or more.