Jane Van Ryan
Posted July 1, 2010
The Senate Environment and Public Works Committee yesterday voted to remove the liability cap on damage claims stemming from oil spills. The proposal could be one of several provisions cobbled into an energy and climate bill that could be considered by Congress in the wake of the Deepwater Horizon accident.
In a news release, API warned that the elimination of liability limits could make insurance unavailable for domestic energy development in the Gulf. More than 100 U.S. companies would be forced out of the exploration and production business, which could destroy jobs, harm economic growth and put U.S. energy security at risk.
API President and CEO Jack Gerard said:
"...legislative proposals that would make domestic resources unavailable or uneconomic, instead of focusing on improving safety, must be turned aside. Millions of families, thousands of products and hundreds of industries across the country depend on reliable and affordable oil and natural gas every single day."
The Independent Petroleum Association of America (IPAA) issued a similar statement, saying that removing the liability cap would benefit large companies that are owned and operated by foreign governments. "This is unreasonable from an economic and business standpoint and will have a devastating impact on job losses and possible increased reliance on foreign oil, "said Bruce Vincent, IPAA's chairman.
BP reports that it already has paid out more than $128 million in claims in addition to establishing a $20 billion claims fund as well as a $100 goodwill fund to help pay the wages of energy workers who lose their jobs due to the deepwater drilling moratorium.
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