Sen. Murkowski Introduces Legislation to Help Spill Victims in the Gulf

WASHINGTON, D.C. – U.S. Sen. Lisa Murkowski, R-Alaska, has introduced legislation to address a number of pressing issues raised by the ongoing oil spill in the Gulf of Mexico, including a provision to expedite payments to those most affected by the spill.

The Oil Spill Compensation Act of 2010 would authorize the president to set the strict liability cap for offshore oil and gas projects on a case-by-case basis at the time of lease using a set of criteria, including a company’s safety record and the depth and pressure of the reserve being developed. In the event of a spill, responsibility for claims in excess of individual liability would be shared by all offshore operators in U.S. waters.

“There are areas where we know the risks of drilling for oil are higher, so it’s appropriate that liability limits correspond to the risk,” Murkowski said. “My goal with this legislation is to ensure the protection of our oceans and coastlines without damaging our ability to produce the resources our economy relies on.”

To speed payment to those affected by the Deepwater Horizon oil spill and to avoid a prolonged legal battle, Murkowski’s bill would establish an administrative process – with an administrator named by the president and confirmed by the Senate – to approve compensation claims. It would also limit attorney fees related to the Gulf spill to 5 percent.

“There’s real concern out there about when BP will pay all the claims they are facing,” Murkowski said. “People are looking for a level of assurance. An independent administrator specifically devoted to this task will assure Gulf residents they’re not up against a huge corporation all alone.”

Murkowski’s legislation would also establish regional citizen advisory councils along the Gulf to give local residents and stakeholders greater say in development off their coasts. The councils are modeled after the regional advisory councils set up in Alaska after the Exxon Valdez spill.

Other provisions of the bill:

  • Increasing the Oil Spill Liability Trust Fund to $10 billion by raising the fee paid by the oil industry to 20-cents for each barrel of oil produced domestically and 60-cents for each barrel of refined product imported to the United States;
  • Increasing to $10 billion the total amount in the fund, which currently has a balance of $1.6 billion, and requiring it be used exclusively for oil spill-related expenses to ensure funding is available in case of future spills;
  • Provide the U.S. Coast Guard a substantial increase in research and development funding and authority to bring oil spill response technology into the 21st century;
  • Restricts oil transportation in Arctic waters to pipelines rather than tankers to reduce the potential of a spill occurring;
  • Directs 37.5 percent of federal revenues from offshore oil and gas production to boarding states and affected communities.

Murkowski, the ranking member of the Senate Energy and Natural Resources Committee, drafted the legislation with input from Gulf-state senators and non-governmental organizations, such as Oxfam International.

“The oil spill in the Gulf is a very emotional issue for all of us,” Murkowski said. “We must make sure we enact legislation based on sound policy that’s beneficial to the residents of the Gulf.”

Murkowski urged the Senate leadership to take up the Oil Spill Compensation Act quickly and as a standalone measure, warning against combining it with controversial climate legislation.

“If these measures get mired in the debate over cap-and-trade, then we’ll have failed the people of the Gulf in their time of greatest need,” Murkowski said.

The full text of the Oil Spill Compensation Act of 2010 is attached.

# # #