Federal judge considers additional Exxon Valdez fee

Reuters Business News
Posted: Mar 18, 2011 2:41 PM
Federal judge considers additional Exxon Valdez fee

By Yereth Rosen

ANCHORAGE, Alaska (Reuters) - A federal judge said on Friday he would consider ordering Exxon Mobil Corp to pay an additional $92 million to help address continued negative impacts from the 1989 Valdez tanker disaster.

State and federal governments are seeking the additional payment, which Exxon has opposed, under a special "reopener" provision included in a sweeping 1991 environmental settlement with the oil industry giant.

The settlement, the biggest of its kind at the time, ordered Exxon to pay $900 million in civil damages and $125 million in criminal fines and restitution, and provided for a payment of up to $100 million for long-term damages that were not foreseen 20 years ago.

The state and federal governments in 2006 presented a $92 million reopener bill to Exxon for such long-term damages. The company has refused to pay and maintains it owes nothing more for the 11 million gallon tanker spill.

U.S. District Court Judge H. Russel Holland said during a hearing in federal court in Anchorage he would take the request under consideration.

Holland is retired but called into service occasionally to oversee legal disputes still lingering from the huge tanker spill that fouled icy Alaska waters 22 years ago.

During the hearing, U.S. Justice Department attorney Michael Zevenbergen and attorneys for Exxon and for the state of Alaska told Holland they have engaged in negotiations to settle the reopener claim.

Exxon believes there is no justification for any additional payment, the company's attorney, Carla Christofferson, told Holland. "To date, Exxon has not seen anything that rises to the level that was supposed to be addressed by the reopener clause," she said.

The company maintained in court motions that Prince William Sound is fully recovered from the spill, and any lingering oil is inconsequential and fully expected decades ago.

Christofferson also said there is already plenty of money to fund environmental work in Prince William Sound and that the trustee council still has $200 million left over from the 1991 settlement.

"There's no delay or anything that is not being addressed," she said.

(Editing by Dan Whitcomb and Peter Bohan)