Menendez Welcomes White House's Commitment To Ensuring Oil Spillers Are On The Hook For Economic Damage

Menendez Welcomes White House's Commitment To Ensuring Oil Spillers Are On The Hook For Economic Damage

White House oil spill response legislative package signals willingness to work with Congress to raise liability caps on companies that spill

Washington - Today, the White House sent to Congress an oil spill response legislative package, which includes the administration's interest in working with Congress to raise the liability cap on companies that spill. U.S. Senator Robert Menendez (D-NJ), author of the Big Oil Bailout Prevention legislation to hold oil companies accountable for economic damage caused by spills, today said that the administration's proposal will help efforts to pass his bill.

"The president's proposal adds even more momentum to our efforts to hold oil spillers accountable for the economic damage they inflict," said Menendez. "I welcome the administration's willingness to work together as we ensure companies that spill are kept fully on the hook and as we improve the safety net that is the Oil Liability Trust Fund. Our coastal communities must be protected against the worst-case scenario, which is why I am working hard to make polluters responsible for all of their damages. Going forward, we need to recognize that the absolute best way to protect the small businesses, fisheries and communities along our coasts is to stop the expansion of coastline drilling and focus on a transition to a 21st Century clean energy economy. There is simply no rig that is too safe to spill."

The White House's proposal does not include a dollar amount for a new responsible party liability cap but does indicate that it will work with Congress to determine that level. Menendez's bill would increase the responsible party's current cap of $75 million to $10 billion.

On the Oil Liability Trust Fund - which is the industry-funded safety net for economic damages after the responsible parties reach their caps - the administration proposes increasing the amount available per spill from $1 billion to $1.5 billion. Menendez's bill would remove the Trust Fund limit altogether.

Menendez's Big Oil Bailout Prevention legislative package (S. 3305 and 3306) would:

• Raise the responsible party liability cap for offshore oil well spills from $75 million to $10 billion.

• Eliminate the $1 billion per incident cap on claims against the Oil Spill Liability Trust Fund and allow community responders to access the fund for preparation and mitigation up front, rather than waiting for reimbursement later.

• If damages claims exceed the amount in the Oil Spill Liability Trust Fund (currently $1.6 billion), then claimants can collect from future revenues of the fund, with interest.

• Eliminate the $500 million cap on natural resources damages.

Recent oil company profits:

Oil Company Q1 2009 Oil Company Profits Q1 2010 Oil Company Profits

Q1 2010 Profits Compared to Q1 2009

BP $2.4 billion $5.6 billion +133%
Chevron $1.8 billion $4.6 billion +156%
ConocoPhillips $0.8 billion $2.1 billion +163%
ExxonMobil $4.6 billion $6.3 billion +38%
Shell $3.3 billion $4.9 billion +49%
TOTAL $12.9 billion $23.5 billion +82%