projo.com

   Digital Extra

Advertising

2006 EPpy Winner -- Best multimedia

Providence, R.I., Overcast 48°

Customize | E-mail newsletters | E-cards | MySpecialsDirect


1/25/96
Cost of oil spill cleanup a private matter between barge owner, contractor
It's not public because Eklof Marine has agreed to pay all costs, through its insurance companies.

By TOM MOONEY
Journal-Bulletin Staff Writer



NARRAGANSETT -- So you want to know how much the spill's cleanup operation is costing?

Forget it.

The contract arrangement between Donjon Environmental Marine Services and the oil barge's owner, Eklof Marine, is a private matter, company officials said yesterday.

And because of the spill's classification, said a Coast Guard official, those companies have no obligation to share that information.

"This is a `responsible-party' spill," explained the Coast Guard's financial expert on the scene, Warrant Officer Rick Petersen. That means Eklof Marine has agreed to pay, through its insurance companies, all damages and cleanup costs.

If Eklof reneges on its responsibility or the cleanup cost goes beyond Eklof's insured limit, then the Coast Guard would step in. The spill would then be classified as a federal spill, and under that scenario, Petersen said, "Donjon would have to tell us" such financial information as its billing rate. That information would then be public.

Petersen said he had specific estimates on how much the spill was costing federal and state agencies, but that he had been "ordered" not to divulge those figures.

Because, as usually happens in such cases, Eklof Marine will likely dispute those figures, the whole issue "will probably end up in court," Petersen said.

Therefore, he said, he didn't want any early estimates to be out floating around that could come back to haunt him later.

Robert P. Umbdenstock, a spokesman for the Donjon cleanup consortium, declined to say yesterday how much the spill had cost so far.

He said only that his company's billing is based on a rate schedule for time and material, and that about 100 to 150 cleanup workers from various outfits are on the company's payroll.

Jesse Lewis, a public-affairs adviser to Eklof, was equally reticent.

Asked how much Eklof had charged to deliver the 4 million gallons of heating oil from Staten Island, N.Y., to Providence, Lewis said he did not know and doubted whether company officials would say.

"This is a private company," he said. "I don't know if they will want to divulge that information."

As part of the Oil Pollution Act of 1990, oil vessels the size of the barge North Cape, grounded on Nebraska Shoal off Moonstone Beach, must carry a minimum of $10 million in liability insurance.

Eklof is insured for that amount through Water Quality Insurance Syndicate, a Wall Street company with some 4,000 clients, including Interstate Navigation, which operates the Block Island ferry.

Eklof also carries a $500 million insurance policy through an international company called West of England, a cooperative of vessel owners who have pooled their money to create additional insurance protection.

In a related matter, Lewis said that Eklof stood to gain nothing financially from its quarter-share partnership in the Donjon cleanup consortium.

Lewis said that Eklof's share of any profits that Donjon made in cleaning up the spill would be "minuscule" and would be offset by losses the company expects to take.



Main Page |Day by Day |Environment |Economy |Context
Commentary |The Human Side

Copyright 1996 The Providence Journal Company
Produced by Rhode Island Horizons,
an online community hosted by the Providence Journal Company and available on Prodigy

Advertising


Advertising
Table of Contents
Home page
PROJOCLASSIFIEDS | PROJOCARS | PROJOHOMES | PROJOJOBS | OBITUARIES | IN MEMORIAMS
Rhode Island News | Business | Lifebeat | Multimedia | National / World news | Opinion | Sports | Weather | Your Turn

News tip: (401) 277-7303 | Classifieds: (401) 277-7700 | Display advertising: (401) 277-8000 | Subscriptions: (401) 277-7600
© 2006, Published by The Providence Journal Co., 75 Fountain St., Providence, RI 02902.