HARD AGROUND - Wreck of the Exxon Valdez - March 24, 1989


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By Daily News staff and wire reports

Anchorage Daily News
Date: 09/30/91
Day: Monday
Edition: Final
Section: Nation
Page: A1

ANCHORAGE- Gov. Wally Hickel today will announce a new settlement of claims arising from the grounding of the Exxon Valdez, almost five months after the first deal fell through.

Details were being withheld until a formal announcement today at the governor's Anchorage office, spokesman Eric Rehmann said. He and other officials refused to say how the new deal differs from the $1 billion agreement rejected earlier.

That agreement, announced in March, fell apart when a federal judge refused the criminal plea bargain and the Alaska House voted down the entire package.

Negotiations between Exxon, the state and federal government resumed earlier this month. A criminal trial of Exxon was to begin Oct. 7 in Anchorage.

Exxon spokesman Bill Smith, reached in Irving, Texas, declined to comment on the new settlement. Justice Department spokesman Amy Kasner refused to discuss the deal.

Rep. Gene Kubina, D-Valdez, said he and several colleagues have been summoned to a briefing with the governor at 8 a.m., but he has not been told anything about the new deal.

Under the previous settlement, Exxon and a subsidiary agreed to plead guilty to four misdemeanors and pay a record $100 million fine. Two felony pollution charges would have been dropped.

Exxon also would have paid $900 million over 11 years to restore damaged natural resources. That money would have settled the state's civil claims against Exxon and any future claims by the federal government. But it wouldn't have affected private lawsuits seeking a total of $59 billion in damages from the oil giant.

That settlement, the largest of an environmental damage case in U.S. history, would have provided immediate cash to continue the spill cleanup and avoided years of lengthy and costly court battles.

But opponents argued the criminal fine was inadequate considering Exxon's wealth and the damage its tanker caused. They also said the settlement's true value was much less because Exxon's $1 billion was to be paid out over a decade on the installment plan.

Pressure has been building on Exxon to settle the government litigation. In the past two weeks, fishermen, landowners, cannery workers, Native Alaskans and other private interests agreed to drop their spill lawsuits against the state and federal government. That meant a united front of plaintiffs suing Exxon.

In exchange for dropping the lawsuits, the governments agreed to share with the private plaintiffs their research on the spill's damage and Exxon's liability.

"The rumors we have heard is the settlement is in the same overall ballpark as the last settlement $1 billion and the only substantial difference is that proportionally more of the money is to be part of the plea bargain and less on the civil side," said attorney Lloyd Miller, representing Native villages in Prince William Sound.

Miller and other lawyers for civil plaintiffs said that could mean less money would be available for restoring natural resources damaged by the spill.

Although legislators were not invited to review the latest settlement, Kubina said they will have a role.

Without legislative approval, the governor lacks the authority to use the settlement money for restoration of natural resources in Prince William Sound, he said.

"It can be done quite easily by appropriating money into the (restoration) trust," Kubina said. "The better the deal is, the less trouble he is going to have from us."

"If he tries to shove it down our throat he is going to have trouble."

The Exxon Valdez spilled nearly 11 million gallons of crude oil in Prince William Sound when it slammed into a reef on March 24, 1989. The oil killed thousands of marine birds and mammals. It also was devastating to the region's Native villages, where most residents still live off the land and sea.

Joseph Hazelwood, the ship's captain, was accused of drinking on shore before the tanker left Port Valdez, but he was acquitted of state charges that he operated the ship while intoxicated.

Story Index:
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