2008 Mississippi River spill: Jeffersonville barge company to pay $6.6M

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An Indiana-based barge company responsible for a Mississippi River oil spill that significantly damage shoreline habitat in south Louisiana in 2008 has agreed to pay $2.1 million in damages and buy and preserve a wildlife habitat just miles from downtown New Orleans.

The U.S. Justice Department on Monday announced the settlement, which seeks to bring about an end to a lawsuit over a 2008 collision caused by a tugboat pulling a barge loaded with fuel oil, news outlets reported.

The American Commercial Barge Line tug Mel Oliver veered directly in front of the MV Tintomara, an ocean-going tanker ship sailing downriver, the DOJ reported. The ship collided with the barges and spilled more than 282,800 gallons (8,000 barrels) of oil into the Mississippi River upriver of New Orleans. The spill spread more than 100 miles (160 kilometers) downriver and covered over 5,000 acres (2,000 hectares) of shoreline habitat.

The agreement still requires the approval of a federal judge. If approved, it would be part of a federal consent decree that would settle civil lawsuits brought by the DOJ and the state of Louisiana over the spill, which caused a six-day closure to river traffic in late July 2008. At the time, it was estimated that the river shutdown led to a loss of $1 billion in commerce.

The tugboat was managed by an unlicensed crew and owned by American Commercial Barge Line, which is headquartered in Jeffersonville. American Commercial was ultimately found responsible for the spill after years of litigation.

The agreement between the company, the Justice Department and the Louisiana Oil Spill Coordinator’s Office means American Commercial will pay more than $6.6 million under the Oil Pollution Act and the Louisiana Oil Spill Prevention and Response Act. That includes $2.1 million cash for damages, $1.4 million for environmental damage assessment and restoration planning and an estimated $3.3 million to buy almost 650 acres (266 hectares) of woodland habitat in Plaquemines Parish.

A 2017 ruling also requires American Commercial to reimburse the federal government $20 million for oil removal and damages. That was on top of $70 million spent by the company itself on removal.

The $2.1 million in damages will go toward building a marsh in the Pass-a-Loutre State Wildlife Management Area and restoring habitat in the company’s newly purchased woodlands parcel.

“This settlement secures full compensation for the damaged resources, including the permanent preservation of 649 acres of critical wildlife habitat along the Mississippi River just a few miles from downtown New Orleans,” said Todd Kim, assistant attorney general for the Justice Department’s Environment and Natural Resources Division. “The restoration projects funded by this settlement will restore wildlife and wetlands, and enhance recreational opportunities for Louisiana’s residents and visitors.”

Some environment advocates contend the penalty comes too late, and that the payout doesn’t meet the scale of the damage.

While the Oil Pollution Act leaves more discretion for negotiations, damages under the Clean Water Act start at a fine of $1,100 per barrel spilled, barring any negligence, Healthy Gulf spokesman Dustin Renaud told The Times Picayune/The New Orleans Advocate. Under the Clean Water Act, damages would amount to about $7.4 million.

“This is an abysmally low settlement, and it’s 13 years late. How many spills have we seen since then?” Renaud said.

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