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Judge refuses to order additional Exxon Valdez payment

By Reuters
Tuesday, March 8, 2011 9:20 EDT
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ANCHORAGE, Alaska (Reuters) – A federal judge has refused to order Exxon Mobil Corp. to pay an additional $92 million sought by the U.S. government and state of Alaska to address lingering damage from the 1989 oil spill in Prince William Sound.

District Court Judge H. Russel Holland, who for two decades has presided over most litigation stemming from the Exxon Valdez tanker disaster, said the governments and Exxon appeared to be working out a resolution, albeit slowly, on their own.

At issue was a “reopener” claim by the U.S. and Alaska governments under a provision in their 1991 settlement with Exxon over environmental devastation from the spill, the nation’s worst from an oil tanker.

Under the settlement, Exxon paid $900 million in civil damages then and committed to as much a $100 million more for possible future losses not originally anticipated.

The U.S. and Alaska governments invoked the reopener claim in 2006, billing Exxon for $92 million they said was needed to address a surprising amount of crude oil still tainting Prince William Sound beaches. Exxon has refused to pay.

In his ruling late on Monday, Holland acknowledged that the reopener dispute had dragged on for years.

“However, the fact that the development of that claim has taken longer than many would wish does not justify the court in taking action contrary to all of the parties’ wishes,” he said.

He noted that none of the parties to the original settlement had gone to court seeking an order compelling payment of the reopener claim.

“The Governments and Exxon have a right to decide for themselves how and when to proceed further with the claim which has been asserted,” Holland said.

Although Exxon has insisted it has no intention of paying an additional $92 million, the judge said it was “abundantly clear” from court proceedings that the oil company and the state and federal governments are negotiating a reopener settlement of some kind.

Rick Steiner, a retired marine scientist and longtime Alaska environmental activist, filed the motion seeking court intervention to bring the reopener process to a close.

Steiner, who pleaded his case in a court hearing on Friday, has argued that the Exxon Valdez spill triggered several long-lasting environmental problems, including a collapse of the herring fisheries in Prince William Sound.

Steiner said late Monday that Holland’s ruling was very disappointing.

“He’s the judge that approved this provision 20 years ago, and for him to disavow any responsibility for it now is pretty astonishing,” he said.

(Editing by Steve Gorman and Greg McCune)

Mochila insert follows.

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