$90 million for a minor role: Is settlement a ‘landmark’ event in Gulf Coast recovery?
by The Anniston Star Editorial Board
Feb 22, 2012 | 2388 views |  0 comments | 6 6 recommendations | email to a friend | print
A subsidiary of Japanese oil company Mitsui agreed last Friday to pay $90 million for its liability in the 2010 Gulf of Mexico oil spill. Of that total, $70 million will be in civil penalties and $20 million will be “to facilitate land acquisition projects in several gulf states that will preserve and protect in perpetuity habitat and resources important” to the environment.

The Obama administration has called this “a landmark settlement,” pointing out that it is the largest penalty ever paid for violating the Clean Water Act.

At the same time, the White House called this an important step “toward achieving accountability and protecting the future of the Gulf ecosystem by funding critical habitat preservation projects.” It added that it is “only a first step.”

That must be kept in mind as events unfold over the coming weeks.

The subsidiary, MOEX Offshore LLC 2007, was a minor partner, the smallest shareholder in the operation. It had no role in the drilling that led to the disaster that killed 11 workers and poured some 5 billion barrels of oil into the Gulf of Mexico. The civil trials of BP and the other defendants begin in New Orleans next week.

Some speculate that those charged in the case may try to work out a deal with the government rather than risk heavier fines and penalties that would come if a trial reveals BP and others were criminally negligent. In addition to the charges brought against the companies by the Justice Department, thousands of Gulf-area residents have filed suit. If the government and the other litigants seek the maximum penalties, the payment could exceed $20 billion.

Meanwhile, analysts are watching to see if the Justice Department can press for penalties that will satisfy those who want BP and its associates to pay — and pay dearly — for the damage they have done, but at the same time not penalize the companies to the point that they cannot recover.

It is hard to say if this first settlement is the beginning of the end or the end of the beginning. Maybe it is both.
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