Sunday, July 5, 2015

Seema Sirohi - BP settles for $18.7 billion in oil spill. Anyone remember Bhopal?

even the marine life in the Gulf of Mexico would seem to have more value than the people of Bhopal who died or are crippled for life

The news that the United States government reached an $18.7 billion settlement with the British oil giant BP for the 2010 oil spill in the Gulf of Mexico will surely remind Indians of a certain industrial disaster in Bhopal.

The terms “largest” and “biggest” apply to both accidents, except in the case of the BP oil spill, they also describe the compensation, fines and penalties. For the abandoned people of Bhopal, they still only mean the magnitude of the calamity that befell them on the night of December 2-3, 1984 as toxic gas spewed from a Union Carbide plant.

BP will pay up to $18.7 billion in penalties to the US government and five affected states, including $5.5 billion in “Clean Water Act” penalties and $7.1 billion for natural resource damages. The payments will span 15 to 18 years. Criminal charges for “lying to Congress” and for manslaughter were settled for $4.5 billion.

The company said the charge for the oil spill is an estimated $53.8 billion. It is the largest corporate settlement in US history and, it is safe to say, in the world. President Barack Obama had said after the spill that he would “make BP pay.” He did.

Price of life: As details of the BP settlement crystallise, even the marine life in the Gulf of Mexico would seem to have more value than the people of Bhopal who died or are crippled for life. The compensation by Union Carbide Corp. for the estimated final death toll of 15,000 and hundreds of thousands injured was a paltry $470 million. Case closed.

Not for a minute can successive Indian state and central governments escape responsibility for their pitiful prosecution of the case in US courts and continued criminal negligence – the toxic waste in the plant is still not cleaned up and has seeped through soil and water. But the role of the US government was no less bleak. In fact, it is difficult to decide whose conduct was more appalling vis-à-vis the people of Bhopal.

The BP rig explosion on April 10, 2010, which led to the death of 11 crew members, spewed roughly 4 million barrels of crude oil into the water. The potential damage to the environment is unknown but a serious clean up effort was underway within days of the accident. The government machinery cranked up to bring BP to book to say nothing of the massive power of the media campaign.

The victims were American – fish and human – their protector the American government and the perpetrator a British corporation. The value of life and loss was calculated on a shared scale.

By contrast, in Bhopal the perpetrator was a US corporation, the victims Indian and their protector a bumbling Indian government. The value of life and loss was calculated on a different scale.

The Union Carbide case: Union Carbide lawyers convinced a Manhattan district court – the judge was pro-corporate – that the case should be heard in India and that company executives would abide by the rulings, something they never intended to and never did. Warren Anderson, the Chief Executive Officer, put under house arrest in India but granted bail, skipped town never to return. He died last September in Florida at the age of 92, far away from the “long” arm of justice, never having faced trial.

The Rajiv Gandhi government settled out of court in 1989 on the advice of a US law firm it had hired to represent the victims of the world’s biggest industrial disaster. The firm Robins & Kaplan lists “Bhopal” as one of its achievements even though it barely gave a fight.

The settlement figure was decided not by the enormity of the suffering but by what insurers of the company were willing to pay Union Carbide – thus $470 million was deemed enough for lives lost, injuries sustained and future birth defects. There was no admission of guilt and Union Carbide to this day claims the gas leak was “sabotage.”

India decided to settle also because of continuous and enormous pressure from the US government then under one of Obama’s Republican predecessors, Ronald Reagan. The message from successive US ambassadors was plain – if you fight, US investments in India would dry up. It’s not good for business. The US government refused to extradite Anderson to face charges in India.

Different scales: Meanwhile, in Bhopal doctors struggled to understand the devastation from the 40-tonne cloud of the deadly Methyl Isocyanate gas over Bhopal. No one knew what to do and Union Carbide refused to share research it possessed on the effects of the gas on the human body. It even refused to provide the exact composition of the gas. It was deemed a “trade secret.”

The US company – since bought over by Dow Chemical – operated its Indian subsidiary with near-zero safety standards, something it dared not to do at home. It drastically cut maintenance costs in the early 1980s to keep its balance sheet happy since its fertilisers weren’t selling well. They were too expensive for Indian farmers.

Both the Indian and US management ignored previous leaks, at least one worker death, and paid no attention to a 1982 study by US engineers on the horrific state of the plant with corroding pipes and faulty valves. In 1984, all six safety systems meant to contain the leak failed.

Court cases filed in Bhopal ultimately resulted in the conviction of seven former Indian employees, including former chairman Keshub Mahindra, for causing death by negligence. They were sentenced to a two-year jail term and fined Rs one lakh each in 2010. Even the presiding judge seemed to have worked on a different scale in judging the value of Indian lives.

Cut to the United States and the BP oil spill. Within days of the spill, the oil giant had set up a compensation fund of $20 billion for immediate help. The settlement reached on Thursday was in addition to the $20 billion. BP shares jumped 5 percent, dubbed “a realistic outcome” by CEO Bob Dudley since it “provides clarity and certainty for all parties.” The words will sting Bhopal survivors just like the gas 30 years ago.
http://scroll.in/article/738703/bp-settles-for-18-7-billion-in-oil-spill-anyone-remember-bhopal