Markey: BP's $1 Billion Gulf Restoration Fund a Down Payment, But They Can't Skip Out on the Full Spill Bill

BP Still Litigating Responsibility, Fines, Which Could Decrease Further Funding

WASHINGTON (April 21, 2011) -- Today, the Obama administration announced the release of $1 billion by BP for restoration projects in the Gulf of Mexico identified under the Natural Resource Damage Assessment (NRDA) process. Yet even as the oil giant is doling out this down payment to help restore the Gulf of Mexico following last year’s spill, it is litigating the size of the spill and the fines they should pay, potentially decreasing their final potential financial responsibility by tens of billions of dollars.

“This is an important down payment from BP to restore the Gulf of Mexico’s environment, but we have to make sure that BP isn’t allowed to litigate their way out of the rest of the bill,” said Rep. Edward J. Markey (D-Mass.), the top Democrat on the Natural Resources Committee. “The Obama administration has once again done an important service for the people of the Gulf by arranging this deal. However, we still need to keep the pressure on BP. When Bob Dudley says that ‘BP gets it’ as he did this week, I’m worried he’s not referring to picking up their full share of the tab for this disaster.”

BP recently filed court documents saying they should not be found as being negligent, and should be fined by the day for their spill, instead of by the barrel. The federal government, however, is seeking per barrel fines of up to $4,300 per barrel spilled, as opposed to the $32,500 per day BP is requesting. Fines by the barrel could total as much as $20 billion for the oil company, as opposed to as little as $2.8 million by the day. BP is also fighting the size of the spill, which would affect the per barrel fines.

The initial $1 billion fund will be split among the five Gulf States of Texas, Louisiana, Mississippi, Alabama, and Florida, and the Department of Interior (DOI), and the National Oceanic and Atmospheric Administration (NOAA). The States, NOAA, and DOI will receive $100 million each and the remaining $300 million will be shared jointly between DOI and NOAA to be used for projects proposed by the State trustees.

The natural resource trustees are currently conducting the NRDA for the Deepwater Horizon oil spill by collecting pre- and post-impact spill data that includes information on fisheries, marine mammals, habitat assessments, and socioeconomic impact studies. While the full magnitude of the injuries to the environment will be difficult to determine until the cleanup is completed, restoration projects have already been identified and work can begin now to start the process of making the public whole.

The scale and environmental impact of the oil spill on coastal and marine trust resources has been unprecedented not only due to scope and duration of the spill, but also due to the timing of the spill, which coincided with spring bird migrations, sea turtle nesting, and the spawning of commercially and recreationally important fish and shellfish populations.

These injuries in the Gulf have placed huge tolls on nature-based industries, such as hunting, fishing, recreation, and tourism activities. The Gulf region sustains a billion dollar hunting and wildlife-associated recreation industry. In 2006 alone, the total value of hunting and wildlife activities totaled $11.2 billion, including over $1.3 billion from non-State residents who traveled to a Gulf State to participate in hunting and wildlife activities. The Gulf region also supports a multi-billion dollar travel and tourism industry. In 2008 alone, the travel and tourism industry in the Gulf generated $94.1 billion in travel-related spending and supported close to one million jobs.