Friday, May 21, 2010

Feds Direct Gulf Spill Evidence To Lab Whose Biggest Client Is Big Oil

The New York Times offers a riveting story Friday about the "cozy relationship," as President Obama has claimed, between Big Oil and the government.

For example, the National Oceanic and Atmospheric Administration insists that all water, sediment and marine animal tissue samples be sent for analysis to TDI-Brooks International testing laboratories in College Station, Tex.., whose biggest clients are the oil industry.

Even though there are dozens of other licensed labs to conduct the analysis, NOAA must issue a waiver for the Gulf of Mexico oil spill evidence conducted elsewhere.

There's another peculiar rule. Local animal rescue workers have volunteered to help treat birds affected by the slick and to collect data that would also be used to help calculate penalties for the spill. But federal officials have told the volunteers that the work must be done by a company hired by BP.

BP, formerly British Petroleum, is the lease holder responsible for damages caused by the Deepwater Horizons oil platform that exploded April 20 and sank two days later, spilling anywhere from 5,000 to as high as 85,000 barrels of gas and crude oil daily from the gulf's floor about a mile below the surface.

Reports The Times:

Dismissing concerns about conflicts of interest at his lab, James M. Brooks, the president and chief executive of TDI-Brooks International, said his company was chosen because of its prior work for the federal government.
“It is a nonbiased process,” he said. “We give them the results, and they can have their lawyers argue over what the results mean.” He added that federal officials and BP were working together and sharing the test results.

Douglas Zimmer of the U.S. Fish and Wildlife Service said the agency lacks the staff to handle all the wildlife affected by the spill. He said letting local organizations handle the birds would be impractical and costly.

“I also just don’t believe that BP or their contractor would have any incentive to skew the data,” he said. “Even if they did, there are too many federal, state and local eyes keeping watch on them.”

Taylor Kirschenfeld, an environmental official for Escambia County, Fla., who asked NOAA for the waiver, said "there is just too much overlap between these people.” 

The evidence determined by the government-approved labs such as the one at College Station will be used by the courts to assess liability against BP.

“Everywhere you look, if you look, you start seeing these conflicts of interest in how this disaster is getting handled,” Kirschenfeld said. 

Again, The Times:
Patrick A. Parenteau, a professor at Vermont Law School, said that concerns about conflicts of interest in the cleanup are cropping up for reasons beyond examples of coziness between the industry and regulators.
He noted that because of the Oil Pollution Act of 1990, which was passed after the Exxon Valdez spill, polluters must take more of a role in cleanups.
“I do think the law brings the polluter into the process, and that creates complications,” Professor Parenteau said. “That doesn’t mean, however, that the government has to exit the process or relinquish control over decision-making, like it may be in this case.” 

Stuart Smith, a lawyer representing fishermen hurt by the spill, remained skeptical. He said state and federal websites included links that directed out-of-work fishermen to a BP Web site, which offered contracts that limited their right to file future claims against the company. Federal judge Helen G. Berrigan struck down that contractual language earlier this month.



I'm not a conspiracy freak. But I do detect a common thread of government regulatory failures in the financial markets crises and the Gulf of Mexico oil spill disaster. In the market meltdown, regulators were caught a sleep because of a culture of deregulation imposed upon them during the last Bush administration. Sharing the blame was the exotic financial dealings in default swaps and derivatives too complex for regulators to figure out. In the oil spill disaster, regulators from the Interior Department said they were understaffed and did not have the expertise of the oil industry's engineers for deep water drilling. Instead, whatever oversight they did manage was taking the word of BP that the required safety tests were satisfactory. Sorry folks, I'm not buying the argument that the government cannot hire regulators that are not experts in the fields they are assigned.

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