Who pays for oil spills?

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seli jan 22 INDEPENDENT NEWSPAPERS Oil from the Seli 1 wreck is strewn on Table View beaches. Picture: David Ritchie

Cape Town - Taxpayers could be forced to foot the bill of cleaning up the next big oil spill on South Africa’s shores, a shipping law expert has warned.

Webber Wentzel partner and shipping law expert Gavin Fitzmaurice warned this would happen if the government didn’t act quickly.

While the government has acceded to the first layer of cover of the International Oil Pollution Compensation Fund – a safeguard that will cover R2.5 billion of the funds required to clean up the next major oil spill – the legislation required to pay the fund the necessary levies from oil corporations to enable insurance cover has still not been passed.

“Basically we are not entitled to any cover at present,” said Fitzmaurice.

He said this was worrying because clean-up costs could hit South Africa hard. In 1989, the Exxon Valdez carrying 53 000 tons of crude oil struck a reef near Alaska flooding the ocean with fuel. Fitzmaurice said this was a relatively small amount of oil, with many of the larger tankers carrying upwards of 290 000 tons.

Clean-up costs for such incidents ran as high as R20bn.

As it stands, Fitzmaurice said taxpayers would be almost entirely liable for the damages. He said there would be two possible scenarios and neither was favourable; either taxpayers would have to pick up the bill or, in the likely event that funds to clean up the spill were not available, South Africa’s coastline would be left blackened by oil which would ultimately hurt a thriving tourism industry and destroy the environment.

Also, affected parties could currently only recover a maximum of up to R180 million from the owners or insurers of a wreck, in terms of our out-dated legislation based on the 1969 Civil Liability For Oil Pollution Damage Convention.

He said all that was standing between South Africa and insurance was a bit of legislative “paperwork” and it was integral to get this out of the way to protect the country against the next major spill.

Meanwhile, JP Smith, mayoral committee member for safety and security, said he was happy with the progress made in regards to the removal of the Seli 1 wreck.

Last year, the boat that ran aground on Blouberg’s beach split open in stormy conditions and spilled oil into the surrounding water resulting in taxpayers having to foot the bill of the clean-up costs.

Smith said the budget for removal of the vessel was already there and the SA Maritime Safety Authority (Samsa) would be handling proceedings, with the long-running saga of the wreck’s removal set to end this year.

David Colly, Samsa’s regional manager for the Western Cape, was unavailable for comment. - Cape Argus


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