Taylor Energy to Pay $43 Million for Longest-Running Oil Spill in U.S. History

WASHINGTON — The Department of Justice introduced on Wednesday that Louisiana-based Taylor Energy pays $43 million in civil penalties and damages for a leak in the Gulf of Mexico that has been releasing oil since 2004, the longest-running spill in U.S. historical past.

As a part of the settlement, Taylor Energy may even switch to the Department of the Interior management of $432 million remaining in a belief fund devoted to cleansing up the spill.

The leak, situated roughly 10 miles off the Louisiana coast, started 17 years in the past when an offshore oil platform owned by Taylor Energy sank in a mudslide triggered by Hurricane Ivan, breaking open quite a few undersea wells. Oil and fuel have been seeping from the positioning ever since.

Taylor Energy, which bought its oil belongings and ceased manufacturing in 2008, has lengthy disputed each the dimensions of the leak and the extent of its duty for cleanup efforts. The settlement on Wednesday marked the top of a yearslong authorized battle over the spill. The $43 million that the corporate pays represented all of its remaining obtainable belongings, the Justice Department mentioned.

“Offshore operators can’t permit oil to spill into our nation’s waters,” mentioned Todd Kim, the Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division, in a press release. “If an oil spill happens, the accountable get together should cooperate with the federal government to well timed handle the issue and pay for the cleanup. Holding offshore operators to account is important to defending our surroundings and guaranteeing a stage trade taking part in area.”

Taylor Energy had arrange a $666 million fund in 2008 to clear up the spill and spent roughly one-third of the cash to cap 9 of the 25 wells that had been broken throughout the hurricane. But after doing so, the corporate mentioned that the remaining 16 wells had been too dangerous to handle as a result of they had been buried below a lot mud and particles, and unsuccessfully sued the Department of Interior to launch the stability of its funds.

In 2018, after new federal estimates recommended that as a lot as 29,000 gallons of oil per day had been nonetheless gushing from the positioning, the Coast Guard ordered Taylor Energy to halt the leak or face steep fines. When the corporate refused, the Coast Guard commissioned an outdoor contractor to construct a containment system that’s now believed to be capturing the vast majority of the leaking oil and despatched Taylor Energy a invoice final yr for $43 million to cowl a yr’s value of removing prices.

Taylor Energy pushed again. The firm claimed that solely a small quantity of oil had nonetheless been leaking from the wells, that oil sheens noticed in the world had been from oil-soaked sediment across the platform reasonably than from the wells themselves, and that additional disturbing the world risked the discharge of much more oil into the Gulf of Mexico. Taylor Energy had additionally challenged the Coast Guard’s containment efforts in federal courtroom, asserting that the corporate shouldn’t be held liable for the prices.

The settlement requires Taylor Energy to dismiss its three pending lawsuits in opposition to the federal authorities. After courtroom approval of the settlement, the corporate will probably be liquidated and can flip over any remaining belongings to the federal authorities. The firm has additionally been ordered not to intervene with the Coast Guard’s efforts to comprise or take away oil from the spill web site.

Taylor Energy didn’t instantly reply to a request for remark.

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