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2012-03-05

BP to Pay $7.8B to Settle Deepwater Horizon Oil Spill Lawsuit. Is it a Bad Deal for Gulf Residents?

Guests

Antonia Juhasz, reporting on the BP Gulf oil spill trial for The Nation magazine on a grant from the Nation Investigative Fund. She’s an oil and energy analyst and author of the book Black Tide: The Devastating Impact of the Gulf Oil Spill.

Greg Palast, an investigative reporter with the BBC. His latest piece at Truthout.org is "BP Settlement Sells Out Victims: Deal Buries Evidence of Oil Company Willful Negligence." Following the Deepwater Horizon disaster, Palast, with cameraman Rick Rowley, investigated the BP oil company over four continents for British TV. His new book about this investigation is called Vultures’ Picnic: In Pursuit of Petroleum Pigs, Power Pirates, and High-Finance Carnivores.

Ian Macdonald, professor of oceanography at Florida State University.

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Investigative journalists Greg Palast and Antonia Juhasz examine who wins and who loses in BP’s settlement. "[BP is] basically being told, if you’re like a bank robber, you put the money back in the vault, and everything’s forgiven," says Palast, who also investigated the Exxon Valdez settlement. Meanwhile, state and federal governments are still pursuing separate civil claims against BP for environmental damage. "That’s when we’re going to hopefully uncover those 72 million pages of investigation that will include wrongdoing not just by BP, not just by Transocean, not just by Halliburton, but every major oil company involved the offshore—and, very likely, at least based on my research, wrongdoing by the Obama administration," says Juhasz. "It’s the desire to keep that out of the public that has pushed this settlement process forward." We also speak with Florida State University oceanography professor Ian MacDonald about what it means to restore the Gulf of Mexico. In the wake of the oil spill, BP pledged up to $500 million over a decade to conduct independent scientific research on the environmental effects. But MacDonald notes, “When oil was gushing, there were literally hundreds of ships […] in place studying this disaster and trying to respond. Now, as we try to learn what happened and prepare ourselves for the next catastrophe, we have nothing like those kinds of resources present." [includes rush transcript]

Transcript

This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: We turn to news that the worst maritime oil spill in history may now yield one of the largest class action settlements ever. Late Friday night, oil giant British Petroleum agreed to a proposed settlement with more than 120,000 victims of the massive spill that spewed nearly five million barrels of crude oil into the Gulf of Mexico. The settlement will now be reviewed by a judge. It has no cap, but BP estimates it will pay about $7.8 billion in damages to individuals. State and federal governments are still pursuing separate civil claims for environmental damage. All this comes as residents say the oil from the spill is still visible all along the Gulf Coast.

ANTHONY JAMES: Back out yonder, way over there, like I said, when you’d walk through the marshes and you’d pull your boot up, you’d just see a running off. You know, I mean, it’s definitely still there.

AMY GOODMAN: Statements from lawyers for BP and the plaintiffs have so far provided the only details about Friday’s proposed settlement with spill victims. The agreement reportedly provides a system to monitor health concerns and compensate people whose illnesses are found to have a link to the disaster. However, the fund BP set aside after the spill has so far refused to recognize similar health claims. Meanwhile, critics argue the new settlement allows BP to avoid going to court, where more than 72 million pages of documents and hundreds of witnesses could reveal damning evidence.

To talk more about this and the knowledge we have of the settlement so far, we’re joined by Antonia Juhasz, reporting on the BP Gulf oil spill trial for The Nation magazine on a grant from the Nation Investigative Fund. Her cover story in the April issue of The Progressive magazine is called "BP Oil Still Tars the Gulf." And she’s author of the book Black Tide: The Devastating Impact of the Gulf Oil Spill.

Here in New York, we’re joined by Greg Palast, investigative reporter with the BBC. His latest piece at Truth-Out.org; it’s "BP Settlement Sells Out Victims: Deal Buries Evidence of Oil Company Willful Negligence." Following the Deepwater Horizon disaster, Palast, with cameraman Rick Rowley, investigated BP oil company over four continents for British television. In 1989, he led an investigation of fraud charges in the grounding of the Exxon Valdez. His new book about his investigation of BP is called Vultures’ Picnic: In Pursuit of Petroleum Pigs, Power Pirates, and High-Finance Carnivores.

We welcome you both to Democracy Now! Antonia, what is your sense of this spill settlement that a judge is going to decide on today?

ANTONIA JUHASZ: Well, basically, it’s that we’re at the very beginning of this process. There was supposed to be a trial on February 27th. I went down to New Orleans to cover it. Instead, I covered the beginning of a very intense, aggressive settlement process. The result of the beginning of that process is this proposal that is on the table. And I think the most important thing to say about it is it actually has the potentials for not being a bad deal. As you said in your opening, BP is saying it’s going to be about $7.8 billion. But that’s just the number they’re putting out. It actually doesn’t have a cap. And it has the pieces in place that could make sure, as you say, that medical is provided, which is critical. It has pieces that allow for future assessments of potential future losses, which hadn’t been in there before. It assumes that if you say your losses are due to the spill, that they are in fact due to the spill. That’s critical. So, a number of pieces that plaintiffs on the ground and the community groups that represent those plaintiffs have been fighting for for two years. But the information is just starting to get out, and once the judge approves the deal, that’s also just the beginning. There’s 45 days for both sides to figure out if they actually like the deal. And it also includes, very importantly, an opt-out provision, which means that even if it is agreed, if you’re a plaintiff and you don’t like it, you can go sue, on your own, in court, which is also something the plaintiffs’ lawyers really want. But again, this is just one slice.

What’s still yet to be negotiated are the state charges against BP—and all the companies involved in the disaster—and the federal government charges. And it’s in those charges that we will hopefully get, in a trial, the discussion of who’s at blame, to what extent are they to blame, and will there or will there not be punitive damages. That’s when we’re going to hopefully uncover those 72 million pages of investigation that will include wrongdoing not just by BP, not just by Transocean, not just by Halliburton, but every major oil company involved in the offshore—and, very likely, at least based on my research, wrongdoing by the Obama administration. It’s the desire to keep that out of the public that has pushed this settlement process forward. It’s pushing BP to the table, when, for example, Exxon refused—excuse me, refused to come to the table for settlement negotiations after the Valdez disaster.

The other thing that’s making this different than Valdez is that after the Exxon Valdez disaster, unlike in this disaster, the U.S. Congress actually took action, and it passed the Oil Pollution Act, which has put in place a lot of very important things that have made this deal different, which is, BP has to pay compensation to claimants. It doesn’t have a choice. BP has to pay for the oil that it spills, under the Clean Water Act. It has to face this very large bill, as long as we apply that act. And that wasn’t in place when the Exxon Valdez disaster was winding its way through 20 years of court. So, I would say the bottom line is we need to continue to focus on the deal that’s on the table and push for, as the process moves forward, that all of that critical information that we want to see gets out in the trial, or if it doesn’t get out in a trial, that a settlement deal requires that it still comes out to the public.

AMY GOODMAN: Greg Palast?

GREG PALAST: I think a settlement is horrific, because it includes no provision that was expected for punitive damages. We’re not getting the information. When I did the investigation with Rick Rowley, we went to the Caspian Sea, for example, and found out that there was a prior blowout, Amy, that there was a prior blowout at a BP rig, Transocean rig, for the same exact reason as the Gulf: that is, cheap, crap cement that they use. That blowout was covered up by BP—by the way, with the connivance of the U.S. State Department, we found out from the Manning WikiLeaks cable. That information hasn’t come out. BP used a method that they knew could kill those 11 men, but it saved them hundreds of millions of dollars, so they continued to use it. That’s the type of information we need from the trial. And there should have been, and it was completely expected that there would be, a provision for punishment, for punitive damages. But what BP was able to pull off here was, effectively, massively increasing the fee to the lawyers, but there was not one single dollar added to the fund that Obama had already forced on BP, not one dollar added to the $20 billion. The same exact terms, and yet there is no trial.

The public is being shorted of the information that proves that this was not an accident, but negligent homicide. They knew from the Baku blowout, which they covered up, that this could happen again. They knew, for example, BP lied about containment. In other words, BP said under oath, six months before the blowout, that it would have all this equipment in place in case there was a blowout. None of it was there. It should have been there in five hours. It wasn’t there for five days, and only when Obama ordered the Navy to act under national emergency. And by the way, I worked on the Exxon Valdez case. BP was in charge of the containment to the Exxon case. Same exact thing. They lied about their ability to contain a spill. They didn’t have the equipment in Alaska 20 years earlier. They got away with it. They didn’t have the equipment in the Gulf. They’re getting away with it again. Without punitive damages, without a trial, they’re basically being told, well, you know, put—if you’re like a bank robber, you put the money back in the vault, and everything’s forgiven. The same game will continue. They’ve saved billions. And this is a very bad deal for the public and for the plaintiffs.

AMY GOODMAN: The ads are running all over television, that BP is running, saying, you know, they’re giving $20 billion in compensation to victims with, quote, "legitimate claims" and $500 million to clean up the Gulf. I wanted to bring Professor Ian MacDonald into this conversation to talk about what it means to restore the Gulf and what it will take. In the wake of the Gulf disaster, BP pledged this $500 million over a decade to conduct independent scientific research on the fate of the oil and its environmental effects. Scientists say the program can also help ensure a more effective response to future oil spills. But the initiative has a major shortcoming, which is part of what Ian MacDonald, a professor of biological oceanography at Florida State University, is joining us to discuss. He is joining us from Tallahassee. Ian MacDonald, what does it take to clean up the Gulf?

IAN MacDONALD: Well, the Gulf has—well, we should be clear that BP did not clean up the Gulf, and the government did not clean up the Gulf. The natural systems in the Gulf were what removed the oil that’s gone. And there is still oil present. It still has an effect. But it was Mother Nature that cleaned up the Gulf, not the agency of government or BP. The question is, how much damage was done, and how can we recover that damage? And I think that’s something that’s going to be the subject of this ongoing research.

The problem that we’re having right now is that when oil was gushing, there were literally hundreds of ships and dozens of submersibles in place, essentially one of the largest flotillas ever assembled, in place studying this disaster and trying to respond. Now, as we try to learn what happened and prepare ourselves for the next catastrophe, we have nothing like those kinds of resources present. So this is a major concern, and it’s a major limit on what we’re able to do.

AMY GOODMAN: What about the $500 million? What is it that you cannot do with that?

IAN MacDONALD: Well, the $500 million is—well, that $500 million is over 10 years. To date, they’ve awarded contracts for three years for a portion of that $500 million. It’s intended, with good intention, to research the fate and effect of the Macondo oil and to try to understand better how deepwater systems can be affected by massive releases of oil and how that oil is transported from the places where it escapes on to the coastline. So we’ll be studying that. I say "we." There are a number of consortia that have been formed, academic institutions around the Gulf, that will be studying that over the next three years, and probably over the next 10 years. But to do that work, we need to be out where the spill happened, out where the accident happened. And that’s in the deep ocean of the Gulf of Mexico. To get there, you need properly equipped oceanographic vessels, submersibles. You need a whole variety of equipment. All that equipment was present by BP’s—with BP’s support during the accident. Now that equipment has moved elsewhere, and the funds to adequately provision a seagoing operation are simply not in place.

AMY GOODMAN: Antoia Juhasz, a final comment, as we go around, talking about what’s coming out of this decision that a judge still has to sign off on, this settlement?

ANTONIA JUHASZ: Absolutely. And I think that one of the things that’s key—and I agree with Greg—is that these numbers that ultimately come out of this disaster need to be, I think, for BP, at least about $60 billion total. Otherwise, we’re going to continue with a process that analysts are saying right now for BP, the way the settlement is moving is that this could be great for BP. What it will do is price out smaller companies from the deep water who can’t afford to deal with what are expected to be even more disasters, because they don’t really know how to do deepwater drilling, but the big guys that can afford the settlements will get to take over deep water. And that means we’re pushing deep water into the hands of the BPs, the Shells, the Exxons, the companies we don’t trust anyway. So, as we move forward with trial and the rest of this trial unfolds, it’s critical that there’s public pressure and public attention so that BP truly has to pay, we make sure this never happens again, and all the people and all the places of the Gulf have the opportunity for restoration, which right now isn’t happening.

AMY GOODMAN: Greg Palast, BP stocks are up with news of the settlement coming out.

GREG PALAST: Yeah, it’s a miracle for BP. It’s gold for BP. They’ve literally saved billions. There’s no punitive damages. The trial doesn’t open them up to other problems. If we had a trial and got the information—for example, Shell Oil—and BP is going to join them—have just been given Obama administration approval to drill in the Arctic Sea above the North Slope of Alaska. We have to know whether these guys are capable of dealing honestly with this. It’s not even a question of whether we have—they have the equipment.

AMY GOODMAN: Five seconds.

GREG PALAST: But they lied to us in the Gulf about the equipment that they had. They lied to us about prior blowouts. This is a company in which fraud is endemic.

AMY GOODMAN: We’re going to have to leave it there. Greg Palast, investigative reporter; Professor Ian MacDonald, Florida State University; Antonia Juhasz, her book is called The Black Tide: The Devastating Impact of the Gulf Oil Spill.

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