2010 Gulf Oil Spill: An Examination in Regard to International Environmental Law - Assignment Example

In light of the lack of stringent international environmental laws protecting the activities of multinational enterprises in host countries, who should be held responsible for the 2010 Gulf oil spill? Introduction Gulf Oil Spill of 2010’s after-effects challenge effectiveness of international environmental laws in the issue of who should be held responsible. This paper examines the relevant aspects of oil spill and relative environmental laws. A brief overview of governing international laws is first made followed by other aspects leading to the conclusion as to who should be ultimately held responsible for the oil-spill-caused loss to the environment and stakeholders. Overview of international environmental laws The three principles the international environmental law treaties embody are the following One, Duties owed to Future Generations which the 1972 Declaration of the United Nations Conference on the Human Environment in Stockholm contains as Principles 2 and 5. The 1992 Convention on Biological Diversity to which all the world countries are signatories obligates parties to integrate in their national laws the issues of conservation and sustainable use of biological resources as embodied in Article 10. Two, Duties to Avoid Transboundary Environmental Harm and the Polluter Pays Principle. The Stockholm treaty contains principle 21 making it a responsibility for the States to prevent or control activities likely to cause damage to the environment of other states or areas outside their national jurisdiction and in case of damage, to collect compensation from the party responsible for it. The Rio Declaration on Environment and Development 1992 declares by Principle 16 that polluter should be liable for the cost of pollution caused by him. Three, The Precautionary Principle. The United Nations Framework Convention on Climate Change (FCCC) 1992 requires parties to exercise caution while dealing with environmental risks under incomplete knowledge. That is, the parties should not shy away from dealing with such risk under the excuse of lack of scientific evidence where there is existence of possibilities of irreversible damages. The parties are required to anticipate, prevent or minimize the detrimental effects of climate change by taking suitable pre-cautionary measures. Cooperation among Sovereign States to Protect Earth’s Environment. Stockholm Principle 24 requires the countries to display cooperative spirit on equal basis whether they are big or small in the matter of environmental protection and improvement. Rio Principle 7 mandates all the States to conduct themselves in a spirit of global partnership while dealing with protection, conservation of Earth’s ecosystem. The National Governments are duty bound to observe the mandates of the above international environmental law Principles (Nickel and Magraw, 2010). Principle 21 still is the core principle of international environmental law. Yet is does not address certain factors of international concerns. “First, Principle 21 balances competing contemporary interests and thus cannot capture the potential inter-temporal impacts of States’ activities. Second, given its focus on transboundary pollution, Principle 21 is largely ‘bilateral’ in outlook. To be sure, Principle 21 alludes to a broader context calling for the prevention of harm to “areas beyond the limits of national jurisdiction”……A third factor in the face of serious capacity problems on the part of developing countries” (Chircop, McDorman and Rolston, 2009. P 44). As for the factor two above, Principle 21 does not give direction as to who should demand compliance of law in the areas outside their jurisdiction. As such, principle 21 is not assertive enough for States to takes actions in the matters of ozone depletion, climate change or loss of biodiversity (Chircop, McDorman and Rolston, 2009). British Petroleum’s (BP) Deep Water Horizon Oil Spill The gulf oil spill relates to the BP’s off shore drilling at The Deepwater Horizon licensed to it by Transocean ltd. The cost of the Horizon is estimated at $ 365 million and it is capable of operating 8,000 feet deep under waters and drill further down by 30,000 feet. On 20 April 2010, an explosion and fire on the Horizon occurred while drilling an exploratory well about 41 miles away from the coat of Lousiana. The explosion and fire resulted in death of 11 workers, injury to seventeen workers and gushing of large amounts of oil into the Gulf of Mexico. The oil spill is reported to have been stopped by July 15, 2010. The resultant damage to BP, the environment and the US gulf coast economy has been estimated as $ 36.9 billion. Three contributory factors alleged to be responsible for the disaster and the extent of damage are (1) human error and some fault in the equipment at the offshore drilling unit, (2) the U.S. government’s inaction to assist in the oil fill containment by not providing resources to assist and (3) information distortion by the media as to the amount and location of waters that were polluted (Smith et al, 2010). Background to the environmental concerns Natural environments are sources of concern for preservation right from the ancient times of Bible and Koran. Ecology came into prominence with German biologist Ernst Haeckel coining the term back in 1866 and later followed by the ideology of environmentalism by the U.S. president Roosevelt during 1901 to 1909. The U.S. has since passed a number of environmental laws during 1960 to 1980. Resource Conservation and Recovery Act of 1976 (RCRA), The Clean Air Act, the Clean Water Act, Emergency Planning and community Right to know Act (EPCRA) and Toxic Substances Control Act were the main legislations. To address the events like Gulf Oil Spill by the U.S. government, legislations in place are Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA or Superfund), Superfund Amendments and Reauthorisation Act (SARA) and Resource Conservation and recovery Act of 1976 (RCRA). While CERCLA ‘s purpose is to identify the locations of storage or release of hazardous substances into the environment, to provide for remediation by the parties or government responsible and to compensate the affected parties for the damage to the natural resources, RCRA enables the Environmental Protection Agency (EPA) to initiate removal of the physical damages and cost recovery actions. The clean up should be done by the parties who brought the hazardous substance to the site of disaster, parties who arranged for the disposal, previous owners or operators who actually did the disposal and the current owners of the property. The responsibility is not determined by negligence or fault nor can there be innocent purchaser defence. The liability is joint and several and hence there is no proportionate liability as such. It was Hyundai Heavy Industries of South Korea which built the oil drilling rig in 1998 and delivered at the Gulf of Mexico in 2003. Prior to the accident, the rig had been in operation at several fields. Actually a methane bubble is believed to have caused the explosion and fire that went on for two days. Calculation of the cost of oil spill damage is very difficult due to unpredictable factors and difficulty in estimating the extent of oil dispersal above and below the surface. The time line of oil biodegradation is also not predictable. The oil-eating microbes however consumed the oil droplets faster than predicted by experts. The negative impact was actually more than magnified by the media. The worst-case scenario did not take place at the Gulf Coast Beaches or the East Coast beaches as confirmed by the business community there. The U.S Government is also accused of turning down offer of aid for cleaning up from other countries. According to Jones Act, foreign vessels and crew are not allowed to work on the U.S. waters. BP is a publicly owned corporation and its stake holders need to know the extent of company’s liability in this connection. A brief over view of damages to commercial fishing, tourism industry, wild life, natural environment and real estate would show that Gulf of Mexico produces nearly nation’s 73 % of harvested shrimp and 59 % of oysters. Revenues from fishing were $ 445 million in Alabama, $ 5.7 billion in Florida, $ 2.4 billion in Lousiana, $ 391 million in Mississippi and $ 2 billion in Texas totalling to $ 10.9 for all Gulf States. Tourism has generated $ 65 billion annual revenue in the past for the Gulf Coast States. When these after effects would subside is difficult to predict since an earlier 1979 Ixtoc oil spill of 140 million gallons in the Gulf of Mexico took five years to be cleared from Texas beaches. BP has in October 2010 reported actual costs of $ 11. 2 billion for spill containment, drilling relief well, capping the original well, relief to gulf states by way of grants, paying for damages claimed and federal costs. As the BP has already committed a $ 20 billion to create “Deep Water Horizon Oil Spill Trust”, total commitments is estimated at $ 36.9 billion (Smith et al, 2010). BP’s liability As the liability is strict one, there is no question of innocence defence for BP. Therefore B.P. and its partners are jointly and severally liable for clean up costs and environmental and economic damages actually caused by BP. At the same time, the U.S. government is also responsible for damages to mitigate the responsibility of BP (Smith et al, 2010). BP also has criminal and civil liability under Endangered Species Act (ESA), The Marine Mammal Protection Act (MMPA) and Migratory Bird Treaty Act (MBTA). The MBTA is a strict liability where the prosecution need not prove that BT had knowledge of their potential liability or that they were not innocent. In fact MBTA was used to make EXXON liable for Valdez Spill and their employees also were held criminally liable for death of protected birds (Alexander, 2010). Discussion and Conclusion The above brief examination of issues arising out of BP oil spill would show that the multinational enterprise operating within the U.S jurisdictions of Gulf of Mexico is clearly responsible for the oil spill it caused. Pursuant to the international treaties seen at the outset, the U.S. government has enacted various laws implicating the offender for liabilities under those laws. The liabilities are invariably strict whether the reasons for the damages are acts of God or not. The international treaties envisage “polluter pays principle’’ which the Government of the country must ensure. And in case of the liability not being fully met for what ever reason, it is the Government of the country that is ultimately responsible as a party to the treaty undertaking to ensure compensations are fully met. And if for business exigency or any economic reasons, the Government of the country needs to patronise the multinational enterprises such as BP, the Government should step in to meet the cost of damages as a public policy. In fact, the Obama Administration is reported to have mitigated the burden of BP by showing concessions on the compensation demanded of them. As already mentioned, since the international law imposes obligations on States to regulate offshore drilling, it is the primary responsibility of the State to meet the losses incurred by fully or partly recovering it from the party violating depending on the resources at its disposal. Article 192 of the Law of the Sea Convention (LOSC) already obligates the U.S. to protect and preserve the environment (Harrison, 2010). In this particular case, BP is responding to the extent of its ability and is reported to have committed about $30 billion by sale of its assets towards the end of 2011 (Fuusset,2010) Another inevitable question arises is how BP is going to meet claims from outside the U.S. For instance, Bahamas is already preparing itself for preventive measures should the oil spill from Gulf of Mexico enter Bahamian waters. The Bahamas Government is planning to get commitment from BP to meet 100 percent of the clean up costs, compensation etc. (Russel, 2010). The liability needs to be limited in order to encourage companies engaged in dangerous activities. The Oil Pollution Act of 1990 of the U.S enacted in the wake of Exxon Valdez oil spill in Alaska renders companies responsible for clean-up of the oil spills and has put a ceiling on the liability to $ 75 million. The Act has also provided for a trust fund of $ 1 billion from which compensation can be provided to meet clean up cost (Environmental Law Alert, 2010). The international environmental laws are less stringent in that the States concerned are assumed to own responsibility by either full recovering from the polluters or partly recovering from them and paying the rest from out of public money to the extent necessary. References Alexander Kristina, the 2010 Oil Spill: Criminal Liability Under Wildlife Laws, CRS Report for Congress, Congressional Research Service, Accessed 18 November 2010 < assets.opencrs.com/rpts/R41308_20100628.pdf> Chircop Aldo, McDorman Ted L and Rolstan Susan (2009) The future of ocean regime -building: essays in tribute to Douglas M.Johnston. The Netherlands, Brill Environmental Law Alert (2010) The Gulf Spill and the Polluter Pays Principle, West Coast Environmental Law, Accessed 21 November 2010 < http://wcel.org/print/491> Fausset Richard (2010) Three environmental groups sue BP over gulf oil spill, Los Angeles Times. Harrison James, The Gulf Mexico Oil Spill and International law. The International Law Observer, Accessed 21 November Nickel James and Magraw Daniel, Chapter 22 Philosophical Issues in International Environmental Law, Ed Besson Samantha and Tasioulas John (2010) The Philosophy of International Law Oxford, Oxford University Press Russel Nancoo, K. (2010). Bahamas government in preparation mode for Gulf oil spill. Grand Bahama, Accessed 20 November 2010 (http://www.thebahamasweekly.com/publish/grand-bahama-bahamas/Government_in_preparation_mode_for_Gulf_oil_spill_printer.shtml> Smith, Lawrence C, Smith, L Murphy and Ashcroft Paul, A (2010) Analysis of Environmental and Economic Damages from British Petroleum’s Deepwater Horizon Oil Spill. Accessed 19 November 2010 Read More