Exxon to Pay $100 Million Fine And Plead Guilty in Valdez Spill- Retrospective

Exxon Valdez Alaska oil spill in 1991. A costly environmental and financial disaster.

Exxon Valdez Alaska oil spill in 1991. A costly environmental and financial disaster.

By KEITH SCHNEIDER, originally posted in the New York Times in 1991.

The Exxon Corporation has agreed to plead guilty to a criminal charge arising from the 1989 Exxon Valdez oil spill and pay a $100 million fine, officials of the Environmental Protection Agency said tonight.

The $100 million would be part of payments by Exxon that could total as much as $1.1 billion over the next 10 years to settle civil and criminal cases arising from North America’s largest oil spill. Alaskan and Federal authorities said today that all obstacles to the settlement appeared to have been cleared.

Final arrangements for the guilty plea, including a review of the agreement by the E.P.A. Administrator, William K. Reilly, are being worked out tonight, the E.P.A. officials said. Protecting the Villagers

It was not clear this evening what charge Exxon would plead to. The company had faced two felony charges and several misdemeanor counts stemming from the March 24, 1989, accident and could have been fined up to $600 million if convicted on all counts, Attorney General Dick Thornburgh said after the company was indicted just over a year ago.

As for the overall $1.1 billion settlement, Federal and state officials have agreed to the arrangement. Although a Federal District Court judge at first seemed to raise another hurdle today when he said he would review it to insure that the rights of 5,000 Alaskan villagers were protected, a state official said early this evening that the final barriers appeared to have been overcome.

Economists said Exxon would be able to claim tax deductions for every payment except for the $100 million criminal penalty, to be paid immediately.The $100 million would be one of the largest, if not the largest, criminal fine ever paid for pollution. A trial on the charges had been scheduled for April 10 in District Court in Alaska. Effects Would be Studied

The villagers had filed suit last week, asserting that they had been locked out of negotiations between Exxon, the State of Alaska and the Federal Government. The villagers said they feared that a settlement would prevent them from recovering financial damages caused by the March 24, 1989, spill.

The settlement, which has been under negotiations for months, would not end Exxon’s legal troubles in Alaska. At last count, 330 separate suits by fishermen, environmentalists and others are pending against the company. But the settlement would end the major suits, brought by the State of Alaska and the United States.

In addition, the company would pay $90 million this year into a fund administered by three Federal agencies and three state agencies. The money would be used for scientific studies of the Prince William Sound region, which suffered great damage, and for projects to continue scrubbing the shoreline of oil left when nearly 11 million gallons of crude oil spilled from the hull of the Exxon Valdez after the tanker ran aground in the sound.

The skipper, Capt. Joseph J. Hazelwood, was convicted on March 22, 1990, of the relatively minor charge of negligently discharging oil but acquitted of piloting the vessel while drunk and other serious charges. He was sentenced to spend 1,000 hours in the cleanup operation and was ordered to make $50,000 restitution.

Exxon said in April 1990 that it had spent $2 billion on the cleanup and had paid an additional $200 million to settle claims.

Continue reading article here: New York Times



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