Commodity Brief - Back-to-Back Oil Spills Renew Concerns over the Fossil Fuel Industry

By Fabrizio, Maria | Washington Report on the Hemisphere, June 3, 2016 | Go to article overview

Commodity Brief - Back-to-Back Oil Spills Renew Concerns over the Fossil Fuel Industry


Fabrizio, Maria, Washington Report on the Hemisphere


On May 24th The Associated Press reported a 21,000-gallon oil spill from a Shell Oil Company underground pipeline in Northern California. According to spokesperson, Ray Fisher, the company has already repaired the faulty pipeline and is working to clean up the area. There is concern among environmentalists and officials that the spill has contaminated the soil, water reserves, or air in the area; however, the extent of the spill's impact is still to be determined.

This spill comes about a week after a more extensive, Shell Oil leak of about 88,200 gallons into the Gulf of Mexico. Despite its span of over 26 square miles and proximity to the coast of Louisiana at approximately 160 miles away, the spill is considered minor. According to the U.S. Coast Guard a "major" spill is defined as an oil discharge of over 100,000 gallons, meaning that the May 2016 spill in the Gulf, falls just shy of this classification. Though there have been few organizations challenging this classification, it is important to remember that Shell has every incentive to underreport the extent of the spill. This is because being labeled a "minor" spill protects the company from the negative press and financial obligations which would be certain externalities of claiming responsibility of a spill of over 100,000 gallons.

So far, Shell and the U.S. Coast Guard have worked together to retrieve 51,000 gallons of oily surface water from the Gulf through skimming methods. There has been little reporting on cleanup measures beyond this surface cleanup, and the platform ostensibly responsible for the leak is already back up and running. Right now, the situation is considered under control, however the long term ecological impacts of this major leak will not be discernable for years to come, and environmental activists are concerned about the impact the spill could have on wildlife. …

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